English councils forecast £10bn in debts by 2028 — The Guardian
Local councils in England are warning of the risk of “catastrophic” debts due to the rapid rise in the cost of supporting children with special educational needs and disabilities. According to a forecast by the County Councils Network, over the next 18 months the value of such liabilities could rise to a record £10bn, The Guardian reports.
The government previously paid off more than £5bn in historic council debts related to SEND support. However, local authorities expect to accumulate liabilities of the same amount again by April, and these could double by 2028.
Increase in applications
The main factor is an increase in applications for education, health and care plans — EHCPs. These are legal documents agreed by local authorities and families; they define the assistance required by children and young people up to the age of 25 and can provide additional funding or places at special schools.
In January, the number of young people with such plans reached 718,000, up 12.5% from a year earlier. This was the largest annual increase since EHCPs were introduced in 2014. Another 1.3 million young people have identified special educational needs.
The County Councils Network believes that the acceleration in applications may partly be linked to parents’ and schools’ efforts to secure support before government changes to the SEND system come into force. The reform envisages a gradual transition to a more inclusive support model in mainstream schools, under which the need for EHCPs could potentially decrease.
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Risk to council budgets
At present, SEND debts are not reflected on municipal balance sheets thanks to a special mechanism agreed with the Treasury. It is due to expire in April 2028. Councils say that without government guarantees to compensate for future overspending, some of them risk losing their financial viability.
Ministers agreed to pay 90% of the debts accumulated by England’s upper-tier councils by March 2026. At the same time, the mechanism for covering future liabilities has not yet been determined. The government said further support would be “appropriate and proportionate,” but not unlimited.
According to internal local authority reports, several councils forecast overspending of more than £100m in 2026–2027 alone. Hampshire County Council expects a £200m deficit this year. Other councils mentioned in the forecasts include Surrey, East Sussex, Kent, Worcestershire and Norfolk.
The UK government said the SEND system was already under significant strain, and that the number of EHCP applications and deficits would continue to grow until the reforms were fully implemented. The authorities also reported investments in access to specialists, including speech and language therapists, and promised to announce details of further support for councils by March 2028.
