An ongoing investigation has revealed that English councils are on track to overspend on Special Educational Needs and Disability (Send) services by nearly £2 billion over the next year.

This overspending is likely to push their accumulated deficits to at least £5.2 billion by March 31, 2026.

The importance of this date arises from the £5.2 billion debt, which has been concealed off local authority balance sheets through accounting maneuvers for the past seven years.

As this debt is set to be reintroduced to the balance sheets, it risks putting many local authorities on the brink of bankruptcy.

The government is faced with two significant challenges: first, addressing the rising historical Send debt and, second, curbing future Send expenditures, which continue to spiral without signs of abatement.

Previous attempts by the former government to control Send spending involved allocating millions in 'safety valve' grants to several councils.

These grants aimed to assist councils in developing more effective methods to manage parental demand for Send support; however, very few of these initiatives have succeeded in reducing costs.

Out of 131 councils that responded to the investigation, 79 entered into grant agreements with the Department for Education (DfE), but only three expect not to operate at a deficit in the coming year.

Some councils, which have gradually approached breakeven, have expressed concern that, once the grants conclude, they will quickly return to significant deficits.

The City of York council stands out as the sole authority indicating a potential shift from deficit to surplus next year.

Despite this hopeful outlook, Bob Webb, York council’s executive member for children, young people, and education, expressed skepticism about maintaining this surplus long-term, stating, "Unless the system is changed, we will go back into deficit quite quickly."

Efforts to alter the system could result in tensions between councils and parents, as councils advocate for legal changes that would provide them greater control over the allocation of specialist Send support.

Conversely, parents argue that such measures will not resolve the underlying issues stemming from mainstream schools' inability to adequately meet the needs of Send students.

Tania Tirraoro from the campaign group Special Needs Jungle noted that parents are often met with resistance when seeking support for their children, asserting that financial difficulties should not be attributed to parents exercising their legal rights to Send support.

In response to this escalating crisis, the government has recently allocated an additional £1 billion to Send services and is planning to establish 10,000 new specialist places within mainstream schools.

A forthcoming white paper aims to overhaul the Send system, necessitating a financially sustainable model for future operations; however, no definitive course of action regarding the accrued deficits has been announced.

At the local level, Jane Hayman, director for Send and inclusion at Norfolk County Council, has described the current system as “broken,” suggesting that it creates conflict between parents and schools.

Norfolk's Send deficit is projected to reach £183 million within a year, and Hayman anticipates that government intervention will be required to address the council's financial needs.

On the other hand, Mike Cox, deputy leader of Bournemouth, Christchurch, and Poole council, predicts that the government may procrastinate on effective solutions, arguing that the financial issues will persist and worsen over time as the deficit continues to grow.