This case study is taken from a small borough that has seen consistent growth in high needs block (HNB) expenditure over the last four years, as shown in Graph 1. They wanted to investigate what was driving this growth by looking at how expenditure varies by provision type.
They decided it would be helpful to look at historic, current and forecasted expenditure by provision type to understand the cohorts of children that could be better supported and where there is the opportunity to have the biggest impact on overall HNB expenditure. Graph 2 shows this breakdown for their expenditure in FY 2022-23.
They found that expenditure in specialist settings, Maintained Special Schools (MSS) and Independent & Non-maintained Special Schools (INMSS) made up the largest majority of their annual HNB expenditure. Their next step was to investigate the key areas driving expenditure in these provisions:
By doing this, it allowed them to understand which provisions they could be focusing their attention on throughout the rest of their diagnostic investigations.
Following on from the activities outlined in the previous case study, a small county council wanted to gauge a view of future growth in HNB expenditure by forecasting the expected position of their future caseload and average unit cost by provision. In this case, the local authority was capacity constrained, as they had a limited number of places in MSS, so they wanted to consider how this could impact the overall number of children being supported with an EHCP in other provisions.
Graph 3 shows historic caseload by provision and forecasted figures up to Financial Year End (FYE) 2028. The local authority generated this forecast by reviewing their historical trends in EHCPs and using several operational assumptions to model this growth over a five-year period.
As a result of capacity limitations in MSS, this LA forecasted an increase in the number of children with EHCPs being supported in INMSS from FYE 2023 onwards, despite a consistent decrease in caseload since FYE 2018. Given this finding, the LA wanted to ensure they were focusing on sufficiency in their MSS as well as ensuring the right support is in place for those who can achieve a better outcome outside of MSS.
Graph 4 shows historic, current and forecasted unit costs by provision. In this case, it is evident that INMSS unit costs are forecast to increase at a faster rate than any other provision type. To explore this further, they carried out a benchmarking activity to compare their unit costs in the independent sector with neighbouring local areas.
The results were reviewed with the local commissioning group, which identified that recent growth rates were in line with the national average. Upon further investigation, they found that a handful of high-value placements were causing this high rate of growth, which was further inflated due to the local authority’s small caseload in this provision. Therefore, they focused on the decision-making process around these placements to ensure they were getting value for money.
