What does Rachel Reeves’ Budget mean for Inclusive Education?

On Wednesday, 30 October 2024, Rachel Reeves delivered her first budget as chancellor. The budget did not provide for any specific funding to help local authorities or schools improve Disabled people’s participation in mainstream settings, despite improving inclusivity in mainstream settings being one of the Labour party’s main goals for the education sector.   

During her budget statement, Reeves announced that there would be a £1 billion increase to Special Educational Needs and Disabilities (SEND) and Alternative Provision (AP) funding. However, most of this funding (£865m) will go towards covering local authorities’ SEND deficits as illustrated in the table below. 

Tariffs & Technical Tax Changes

Local authorities have “discretion” on how they will spend the remaining £135m. It is not known if any of this amount will be used to improve Disabled people’s participation in mainstream settings. 

The budget shows that the Government is aware that mainstream settings are not suitable for all Disabled children and young people. The Chancellor announced that the Government will “support pupils with special educational needs that can only be met in a private school” by providing compensation to local authorities for VAT on these pupils’ fees. This is because the government is introducing a 20% VAT on education and boarding services fees charged by private schools from 1 January 2025. 

The Chancellor also announced that “[t]he government will also remove business rates charitable rate relief from private schools in England from April 2025.” However, “[p]rivate schools which are “wholly or mainly” concerned with providing full time education to pupils with an Education, Health and Care Plan will remain eligible for business rates charitable relief.” 

The above two measures imply that the government expects Disabled children and young people who are not being catered for in mainstream schools to be catered for in private schools.  This is an expensive option as the funding required is £61,500 per pupil in private schools, compared to £19,100 for pupils with EHC plans in mainstream secondary schools.  

Where the child or young person has an EHC plan, this amount is paid by their local authority, meaning that it pays three times more for a child in a private school than for a child in a mainstream secondary school.  As many local authorities are experiencing financial constraints and are expected to be reducing their budget deficits under the DfE’s Delivering Better Value programme, this raises some critical questions: How many pupils with EHC plans can local authorities afford to send to private schools and what happens to the rest?   

Where the child or young person does not have an EHC plan, parents are expected to pay this amount. This marginalises Disabled children and young people from under resourced backgrounds or marginalised communities who do not have EHC plans and failed to get the support that they require in mainstream schools. Some of these children and young people may not have or have been refused EHC plans due to local authorities’ aiming to achieve their goals of limiting the number of EHC plans assessments and issues under the DfE’s Safety Valve programme.  

Inclusive Education is a human rights and social justice issue that is protected under Article 24 of the UN Convention on the Rights of Persons with Disabilities (UNCRPD). As it was Labour that signed the UNCRPD, we expect them to be intentional about fulfilling their obligation to implement Inclusive Education.  

Labour has repeatedly stated that its ambition is to improve inclusivity in mainstream education. However, the budget has failed to match this ambition. The lack of any specific funding to help local authorities or schools improve Disabled people’s participation in mainstream settings, compounded by continuing spending on private school fees are a signal that things are going to remain unchanged. It is clear that the government has sufficient funding for inclusive education but choose to spend it on segregated education. This does not uphold the presumption to mainstream education as stated in the Children and Families Act 2014. 

To achieve its ambition of improving inclusivity in mainstream education, ALLFIE argues that the government should channel more financial resources to local authorities and schools so that they are able to properly resource and support every child and young person in mainstream educational settings. This includes providing funding to ensure that all infrastructure, workforce and services in mainstream educational settings are inclusive and accessible.  

At the same time, the Government should develop plans to phase out all forms of segregated educational provisions, such as special schools, colleges, alternative provisions, units or private schools, and redirect the financial resources channelled to these segregated educational provisions towards ensuring that mainstream educational settings are able to support every child and young person. 

The Government wants the country to believe that they are committed to supporting Disabled children and young people, but this budget tells a different story. This budget creates barriers to inclusive education and full participation in society, showing that Labour is continuing to let Disabled people down. 

By Dr Edmore Masendeke, Policy and Research Lead