The Schools Forum of Shropshire Council met on Thursday, 22 January 2026, to discuss school funding arrangements for the upcoming academic year and the ongoing financial challenges within the Dedicated Schools Grant (DSG). Key decisions included the approval of the National Funding Formula (NFF) for 2026-27, with a commitment to transfer up to 0.5% of the Schools Block to the High Needs Block, and the approval of proposals for the Central School Services Block (CSSB).

School Funding Arrangements 2026-27 and Block Transfer

The forum discussed the proposed school funding arrangements for 2026-27, which involve an increase in the primary unit of funding (PUF) to £5,963 and the secondary unit of funding (SUF) to £7,196. The overall Schools Block allocation for Shropshire is set to increase by 4.55% to £234,352,356. A significant point of discussion was the potential transfer of up to 0.5% of the Schools Block funding to the High Needs Block to address the substantial deficit in that area. Shropshire Council currently faces a £41 million high needs deficit, driven by increased Education, Health and Care Plans (EHCPs), top-up funding, and placements in independent special schools.

After reviewing the Authority Pro Forma Tool (APT), which models the impact of funding changes, the forum agreed to a proposal to transfer 0.5% (£1,165,244) of the Schools Block to the High Needs Block. This decision was made with the understanding that the NFF is affordable for Shropshire and that this transfer would help mitigate the high needs deficit. The forum noted that if the formula proved unaffordable, a further meeting would be convened. The decision was made to defer the final decision until January, when the APT would be available and modelling could be shared. The forum agreed to transfer up to 0.5% of any remaining balance after fully funding schools, as in previous years. If the formula is affordable and a surplus remains, it will be transferred to high needs without the need for another meeting; otherwise, a special meeting will be convened.

The report on School Funding Arrangements for 2026-27, presented by Jo Morris and John Rowe, detailed the NFF and the potential transfer of funding between blocks. The report recommended that the Schools Forum note the specific funding arrangements from April 2026, which would then be recommended to the Shropshire Council Cabinet for approval. The forum approved the outlined funding arrangements for the NFF, with the caveat that if the formula proves unaffordable, a further meeting would be convened in January.

Dedicated Schools Grant (DSG) Monitoring 2025-26

Stephen Waters presented a report on the Dedicated Schools Grant (DSG) monitoring for 2025-26, highlighting a forecast outturn deficit of £24.524 million as at the end of December 2025. This figure, when added to the £17.566 million deficit carried forward from 2024-25, results in a cumulative DSG deficit of £42.089 million.

The report detailed significant overspends within the High Needs Block, particularly in top-up funding for both mainstream and special schools. An overspend of £6.691 million was noted for top-up funding to mainstream schools, attributed to increasing requests for EHCPs and the issuing of EHC plans. Similarly, an overspend of £5.565 million was reported for top-up funding to special schools, partly due to increased banding levels across the council's special schools, aligning with a strategy to build capacity and reduce reliance on independent special school placements. The report also highlighted a substantial overspend of £8.671 million for non-maintained and independent providers, with expenditure forecast to be 27% higher than in the previous financial year. This increase is linked to a sharp rise in demand for independent special school placements and the frequent use of independent alternative providers, particularly for post-16 students.

The report also indicated an overspend of £1.470 million for Post 16 funding at further education colleges, influenced by factors such as the accounting of invoices and new high-cost placements at an independent special post-16 provider. Furthermore, an overspend of £1.619 million was forecast for SEN Support Services, primarily due to the employment of additional staff, including agency workers, to manage increased demand.

The forum noted that the government has extended the statutory override for SEND deficits until March 2028. Council officers have met with the Department for Education (DfE) to discuss the DSG deficit and the management plan. The DfE confirmed the forecast DSG funding assumptions for 2026-27 and beyond and supported the proposed expenditure mitigations.

Delegation and Top Slicing of DSG for Maintained Schools

Samantha Bradley presented the results of a consultation with maintained schools regarding de-delegation and top-slicing of the DSG. The consultation achieved a 52% response rate. The forum approved proposals for:

• Pupil growth contingency: 57% for, 43% against.
• Maternity: 89% for.
• Trade union duties: 86% for.
• School improvement: 93% for.
• Redundancy: 82% for.
• Statutory school finance: 96% for.
• HR/Health & Safety: 96% for.
• Education access: 82% for.

The approach to consultation was deemed successful and will be repeated next year. Mark Rogers, Headteacher of The Oxon Primary School, was the only eligible voter present and voted in line with the majority on each item.

Central School Services Block (CSSB)

Stephen Waters presented the CSSB allocations and context. The CSSB funds central functions for all state-funded schools, including historic commitments (such as termination of employment and prudential borrowing) and ongoing responsibilities like admissions, forum servicing, copyright licences, and statutory duties. Historic commitments were provisionally reduced by 20% but were expected to be protected at previous levels following an appeal to the Education and Skills Funding Agency (ESFA). Ongoing responsibilities saw an increase of 10.9%, but this was offset by rolled-in grants, resulting in no real increase. The forum approved all proposals for both historic and ongoing responsibilities. It was noted that if the forum did not approve these proposals, the funds could not be repurposed and would remain in DSG balances, while statutory duties would still need to be delivered by the authority.

Schools Forum Work Programme 2026-27

The Schools Forum Work Programme for 2026-27 was presented, outlining key topics for future meetings. These include ongoing monitoring of the Dedicated Schools Grant, updates on school revenue funding, analysis of school balances, and consultations on the central retention of DSG from April 2027. The programme also includes discussions on the Graduated Support Pathway (GSP) and EHCP top-up funding, as well as the impact of the Alternative Provision/Inclusion Development Fund.

The next meeting of the Schools Forum is scheduled for Thursday, 19 March 2026.