The Schools Forum is scheduled to meet on Monday 15 June 2026 to discuss the financial outturn of the Dedicated Schools Grant (DSG) for the 2025/26 academic year, proposed amendments to the Scheme for Financing Schools regarding academy conversion costs, and implications of national SEND reforms and changes to free school meal eligibility.

Dedicated Schools Grant Outturn 2025/26

A key item for discussion is the Dedicated Schools Grant (DSG) outturn for the 2025/26 academic year. The report indicates a cumulative DSG deficit of £59.220m carried forward into 2026/27. This deficit is largely driven by an overspend of £29.269m in the High Needs Block (HNB), which is a national concern attributed to increased demand for Education, Health and Care Plans (EHCPs) and rising associated costs. The report also notes a £317k overspend in the Early Years Block and a £411k underspend in the Schools Block.

The report highlights the ongoing financial risk associated with DSG pressures, despite the extension of the statutory override to March 2028. It also mentions potential government support of up to 90% of the accumulated DSG deficit on 31 March 2026, subject to the approval of a Local SEND Reform Plan. If approved, this could reduce Manchester's deficit by up to £53.298m. However, the report cautions that this funding is not guaranteed and depends on the submission and approval of the reform plan. The financial consequences of these issues are detailed in the Dedicated Schools Grant (DSG) Outturn 2025/26 report¹.

Amendment to the Scheme for Financing Schools: Recovery of Academy Conversion Costs

The Schools Forum will consider a proposed amendment to the Scheme for Financing Schools to enable the Local Authority to recover eligible academy conversion costs. This proposal follows approval by the Council's Executive on 13 March 2026 to implement a charge to maintained schools contributing towards the council's costs in supporting voluntary conversions to academy status.

The report outlines a schedule of charges for conversions, with community and voluntary controlled schools facing a £10,000 charge, foundation schools £7,500, and voluntary aided schools £7,000. The proposed amendment to Section 6.2 of the Scheme for Financing Schools states that these charges will be recouped from the school's final budget share payment before conversion. The council consulted with maintained schools on this proposal, receiving five responses, with questions clarified regarding inflation increases and the rationale for the charges. Further details are available in the Amendment to the Scheme for Financing Schools Recovery of Academy Conversion Costs report².

SEND Reforms and Funding Implications

The meeting agenda includes a discussion on the implications of national Special Educational Needs and Disabilities (SEND) reforms and associated funding streams announced by the Department for Education (DfE). Local Authorities are required to develop a Local SEND Reform Plan, and Manchester has drafted its plan, which was submitted to DfE advisors on 15 May 2026.

Key funding streams mentioned include the Experts at Hand (EAH) and SEND Transformation Funding (£5.2m for 2026/27), the Inclusive Mainstream Fund, the Inclusive Early Years Fund (estimated £0.5m), SEND Capital Funding (£10.29m for 2026/27), Core Schools Budget Grant (CSBG) for Special Schools, Best Start Family Hubs funding (£0.7m in 2026/27), and Supported Internship Grant (£497k for 2026/27). The report highlights that while these reforms aim to improve inclusion and financial sustainability, there remains a risk that rising demand for EHCPs could outpace mitigation efforts in the short term, creating further financial pressure on the High Needs Block. The SEND Reforms and Funding Implications report provides further information³.

Changes to Free School Meals from September 2026

The Schools Forum will also receive an update on the national expansion of Free School Meals (FSM) eligibility from September 2026. This policy aims to address child poverty and increase access to nutritious meals, with an estimated 500,000 additional pupils becoming eligible nationally.

From September 2026, FSM eligibility will extend to all children in households receiving Universal Credit, removing the current earnings threshold. This expansion will be supported by a dedicated FSM Expansion Grant, allocated at a per-pupil rate of £295. The report notes that Manchester currently has 49% of pupils eligible for FSM, significantly higher than the national average. The Changes to Free School Meals from September 2026 report details the policy changes, funding methodology, and operational implications for schools and the Local Authority⁴.