The Government faces a rebellion from Labour MPs over special educational needs and disabilities (SEND) reform following confusion over how changes to the system would be funded.
The Chancellor revealed in the Budget that the cost of SEND provision would be fully absorbed into existing central government spending limits by 2028/29, rather than sitting on the local authority books.
However, ministers have not set out how they intend to account for the £6bn shortfall in 2028/29, with the Office for Budget Responsibility (OBR) suggesting that this could lead to a 1.7 per cent real-terms cut in the schools budget rather than a planned increase.
A corrected OBR briefing later revised the real terms cut to 4.9 per cent.
“If it were fully funded within the Department for Education’s (DfE) £69bn RDEL core schools budget in 2028-29, this would imply a 4.9 per cent real fall in mainstream school spending per pupil rather than the 0.5 per cent real increase planned by Government,” it read.
The DfE said the OBR’s analysis was “incorrect” and that the extra money would be found from across government budgets, rather than just the schools budget.
In a leaked message to quell fears among Labour MPs, Phillipson said the OBR’s analysis was “misleading” and that reforms would bring costs down – she later criticised her message being leaked.
SHOTS FIRED:Bridget Phillipson, the education secretary, accuses the OBR of being 'misleading' after it said that SEND costs could lead to a 4.9% cut in mainstream school spending, @matilda__martin at PoliticsHome revealsShe told Labour MPs on Whatsapp: 'Any future SEND costs…
— Steven Swinford (@Steven_Swinford) November 27, 2025Labour backbenchers have previously said that the Government could face a rebellion bigger than welfare if the reforms involve “any cuts to the budgets”.
Following Wednesday’s announcement, Labour MP Ian Lavery told The i Paper that his colleagues are “hanging by a thread to see what happens”, after every debate on SEND has been “ram-jam-packed”, mainly with Labour MPs.
He said reform is urgently needed to support “tens of thousands of people who are seeking support from local authorities that are not getting sufficient funding”.
But the MP for Blyth and Ashington added that he hopes the “funding which is required will be backed up by the Government” – and is “waiting anxiously” to see the details.
Lavery said: “As far as I’m concerned, if there’s any reduction in support for SEND individuals, then I wouldn’t be supporting it, it’s as simple as that.
“I genuinely believe there’ll be a whole number of other people who will not be able to accept anything that waters down the SEND provision.”
Labour backbenchers are understood to be on tenterhooks over what the reforms will entail and some are poised to vote against any change that “waters down the SEND provision”.
And parents and campaigners have raised fresh concerns over the lack of clarity from the Government over how it intends to fund SEND centrally.
A Government source insisted that there would not be any cuts to SEND funding, with investment set to rise over the course of the parliament.
They said it is hoped that the reforms will naturally bring down deficits by making the system more efficient, but if that is not the case, the excess will be found in existing central government spending limits.
But with the OBR now expecting a 14 per cent rise in SEND spending in real terms this year alone, it is unclear where the money needed for major investment in the SEND system will come from.
square EDUCATION Every state school child faces funding cut to pay for SEND provision
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The Labour chair of the Commons Education Select Committee, Helen Hayes, said transforming the SEND system “won’t come for free” and urged the Government to provide “urgent clarity” on how the reforms will be delivered.
“SEND deficits have been a symptom of the wider crisis in the SEND system, which is failing children and families across the country,” she said.
“The Committee’s recent report set out how the Government can reform SEND services so that children and young people’s needs are met, but we are clear this will require investment in the large-scale transformation that is needed to get to a more sustainable funding position over time,” Hayes added.
Munira Wilson, the Liberal Democrats’ education spokesperson, told The i Paper that there are “huge questions” left by the Budget.
“Without significant new money from the Treasury, I’m really worried that we’re going to see yet more salami slicing of core schools budgets,” she said.
Parents and campaigners have criticised the Government for leaving families in the dark over how the reforms will be funded, and what this means for their children.
“If the Government thinks SEND reforms can succeed quickly while delivering savings of that magnitude, it is misguided,” said Stephen Kingdom, campaign manager at the Disabled Children’s Partnership.
He continued: “Parents have told us they were already worried about forthcoming reforms now they are hearing about potential cuts to school budgets to make good that £6bn.
Kingdom called on the Government to be “transparent with families who are already traumatised and exhausted from years of trying to achieve the ordinary things like a safe school for their children”.
Madeleine Cassidy, chief executive of IPSEA, a leading charity in the field of SEND law, shared similar concerns over how the Government intends to fund SEND centrally.
“We’re being asked to take a leap of faith without any visibility of the landing zone,” she said. “If centralisation simply means folding SEND budgets into the wider education pot, without ring-fencing or no growth funding, then SEND provision and the legal rights of children with SEND risk being diminished in this budget.”
“That would be wholly unacceptable for families, schools and local authorities already operating under unsustainable pressure,” Cassidy added.
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The DfE said that any deficit will be absorbed within the overall government budget and the OBR’s projections “do not account for the much-needed SEND reforms this government will bring forward”.
A Government spokesperson said: “We inherited a SEND system on its knees and our changes will make sure children get support at the earliest stage, while bringing about financial sustainability for councils.
“We will continue engaging with parents, teachers and local authorities and will set out our full plans to reform the system through the Schools White Paper early next year.”
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