How does the Autumn budget impact on schools and academy trusts?
Changes to SEND deficit arrangements likely to be measure with the greatest long term impact on schools.
On 26th November 2025, Rachel Reeves delivered Labour’s budget detailing the government’s plans for the economy. Our below article explores the key impacts that the Chancellor’s new budget will have on schools and academy trusts.
SEND cost deficits
The Chancellor announced that the government is planning to pass responsibility for Special Educational Needs and Disabilities (SEND) funding deficits from local authorities to central government from April 2028. This will relieve pressure for local councils who have to date been able to keep SEND deficits off their books under a statutory override which expires in March 2028. However, with a £6.3 billion cost estimate in 2028-2029, the government have yet to announce their identified savings to meet this new financial responsibility.
The Office for Budgetary Responsibility has said that if these additional costs were to be met from the core schools budget, then mainstream funding could fall by 1.7% per pupil, rather than the 2.4% increase that the government had planned.
A shift to central government responsibility for SEND costs is likely to have a significant impact on SEND support in the long term. An optimistic view would be that centralisation may improve the current fragmentation created by SEND funding arrangements, falling as they do between schools and local authorities. However, a more centralised approach may well go hand in hand with a drive to lower spending on SEND support and to water down the current legal obligations to make provisions for need as set out in an EHCP.
Removing the two-child benefit cap
The previous policy, which was introduced in 2017, restricted parents’ ability to claim universal credit to just their first two children. From April 2026, the government will scrap the two-child limit on Universal Credit, a move expected to lift around 450,000 children out of poverty. This change will provide additional financial support for families which means schools could see a decline in the amount of their pupils who are experiencing financial hardship.
Children’s playgrounds
The government has announced a £18 million investment over the next two years to create or upgrade up to 200 playgrounds across England. While details on locations and whether these will be school-based are yet to be confirmed, the initiative aims to improve access to safe and engaging play spaces for children.
School libraries
A further £5 million will be provided to state-funded secondary schools in 2026-27 to purchase new books in support of the National Year of Reading.
This builds on the government’s £10 million commitment for primary school libraries. Rachel Reeves commented that there are currently 1,700 primary schools which do not have a school library and that she was making this commitment with the objective of ensuring that every primary school in England has a library by 2029. Further details about how this money will be used have yet to be provided.
VAT on private school fees
The VAT that was added to private school fees from 1 January 2025 has been said to raise £40 million more than was expected. The government’s forecast that around 6% of private school pupils are expected to leave the system following the change remains the same.
How Wrigleys can help
The education team at Wrigleys is expert in helping trusts, schools and other charitable or not-for-profit education organisations govern their activities in compliance with the requirements of legislation and regulatory bodies.
We work within the wider charities and social economy team at Wrigleys and have a proven track record and expertise in advising trusts and other charities and not-for-profit organisations on their governance, compliance and regulatory requirements.
We are therefore ideally-placed to advise schools and academy trusts on the legal implications of the budget and what it means in practice.
If you would like to discuss any aspect of this article further, please contact our Education team on 0113 244 6100.
You can also keep up to date by following Wrigleys Solicitors on LinkedIn.
The information in this article is necessarily of a general nature. The law stated is correct at the date (stated above) this article was first posted to our website.
Specific advice should be sought for specific situations. If you have any queries or need any legal advice, please feel free to contact Wrigleys Solicitors.
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How Wrigleys can help Our employment lawyers within the education team at Wrigleys are expert in assisting schools and academy trusts with all aspects of employment law, including preparing settlement agreements and providing legal advice to support the justification of severance payments in line with DfE guidance. We work within the wider education team at Wrigleys and so have an in-depth understanding of how the governance and regulatory obligations on academy trusts and schools impact on decisions about staff. Our education team can also help to minimise your risks by providing advice on governance, charity law, trustee and director duties, and the delegation of powers and reputational risk. If you or your organisation require advice on this topic, get in touch. |
