WELCOME TO THE NATSPEC ANNUAL CONFERENCE 2015

High Needs Funding Update Peter Mucklow Director for Young People Education Funding Agency

Where are we now?

Market entry / market exit Academic year Market entry Market exit 2014/15 Calthorpe Vocational Trust  Lindeth College Uplands Educational Trust Midstream (West Lancs) Ltd Groundwork South Tyneside and Newcastle Inroads (Essex) Ltd 2015/16 Ambitious College The Media College Cambian Wing College Trinity Specialist College Chatsworth Futures Ltd

Section 41 Application process commenced April 2014 and now two application windows have been completed 182 institutions approved as at 31 December 121 independent special schools and 61 SPIs Spring 2015 applications closed on 17 February and the list will be updated and published at the end of April 36 institutions applied 30 independent special schools and 6 SPIs Summer 2015 application window opens 8 May 2015 All subsequent applications will be considered as an annual process, commencing in summer term 2016 Application window opens 6 May 2016

2014/15 institution survey Autumn 2014, survey regarding contracts and payment processes for high needs students Surveyed every FE college with HNS and all SPIs Focussed on cases where E3 had not been agreed or interim payments made Received 383 responses where 202 institutions stated E3 had not been agreed or interim payments made, of which 27 were SPIs Of the 202, 32 institutions had 30 or more students for whom payments had not been made, 8 of which were SPIs Followed up all 202 responses where mitigating action was not in place, many of which we were already aware of and working on In February all institutions confirmed as being satisfied with LA actions

2015/16 exceptions process Rolled forward 2014/15 place numbers for the basis of 2015/16 allocations Process to review exceptional cases against published thresholds Exceptional cases process resulted in: £8m FY (£11m AY) of funding committed to additional places within institutions (see table on following slide) £47m distributed as additional funding using population data to local authorities

2015/16 exceptions process Type Number of places Cash value Academic year Proportion of places Pre-16 places in schools and academies 142 £1.4m 10% Post-16 places in schools and academies 252 £2.4m 17% Pre and post-16 places in NMSS 59 £590k 4% Further Education and CCP 875 £5.25m 60% Special Post-16 Institutions 129 9% Total 1457 £11.04m 100%

2015/16 allocated places 2013/14 2014/15 2015/16 Allocated post schools places 18,500 22,250 23,300 Allocated in SPIs 2,800 3,200 3,300 Allocated in FE colleges 15,400 19,400 Allocated in CCPs 300 550 600 Place funding costs (E1 and E2) £203.5 m £245.3 m £255.2 m

DSG funding Funding for high needs has increased year on year for the last three years 2013/14 2014/15 2015/16 High needs block total £4.967 bn £5.184 bn £5.245 bn

2015/16 student number allocation Allocated student volumes (E1) for 2015/16 on: The basis of the outcome of the high needs exceptional case process for institutions Only exception to this is where the count of valid students in the 2014/15 R04 uplifted by the previous years ratio, results in a higher volume than that agreed through the high needs exceptions process. In this case we funded on the higher number In a number of cases where there were data credibility issues we have used the count of valid students based on the 2014/15 R06 return

2015/16 allocations What if I exceed my allocated place numbers? E1 will be picked up on the lag in the following year’s allocation Any support costs (E2 and E3) will be provided in year by commissioning local authorities as appropriate LAs will fund this through the high needs block and we have distributed £47 million using population data to support this

2015/16 funding factors Reviewed whole year data based on final R14 return for 2013/14 as highlighted in the autumn letter to the sector For most institutions, impact of moving from national averages to real data would result in a reduction in the funding per student In these cases we have applied the same national SPI funding factors and uplifts as used in 2014/15 allocations In cases where an institution’s real data generated a higher rate of funding per student than the national averages, we used that to calculate the 2015/16 allocation. This approach is for one year only, to provide funding stability for the sector during a continued time of change.

Transitional protection Transitional protection confirmed for a further final year 2013/14 2014/15 2015/16 Number of institutions protected 28 29 27 Number of institutions not protected 32 Number of protected places 256 413 TP Funding £12.9m £16.3m £8.1m Data for SPIs only Only those that have been eligible for TP in each year are included in the table 

Looking ahead

Timings for 2015/16 Published the 2015/16 high needs funding guide on GOV.UK in March Decision on placement by 31 May 2015; 31 March for 2016 in line with the Act 2014 Contract signed with institution by 30 June 2015; Student starts by 30 September 2015; First payment made by 31 October 2015, where a monthly payment has been agreed.

Looking forward to 2016/17 Data quality and planning Planning for 2016/17 allocations is underway in consultation with HEG To confirm arrangements by July 2015 Can only move towards a lagged funding system if we have accurate data recorded for high needs students Recorded HNS by SPIs at R06 represented 94% of allocated places, up from 85% at R04 Will continue to monitor and contact SPIs along with other institutions to encourage further improvements by R10

Looking forward to 2017/18 Top-up funding and research project DfE issued wider call for evidence (now closed) to help work out better ways to distribute special educational needs and disability (SEND) funding. Move towards a more formulaic distribution of top up funding and away from a model which is based on historic allocations Research project led by the Isos partnership reports back in May