Norfolk County Council is sitting on a £192 million deficit in its Dedicated Schools Grant (DSG) — the ring-fenced funding used to pay for Special Educational Needs and Disabilities (SEND) services — as of 31 March 2026.

Officers told the Strategic and Corporate Select Committee on 15 July that the deficit reflects demand for SEND services far outstripping available funding. The council has been able to keep operating only because the Government has allowed local authorities to use a "statutory override" that excludes DSG deficits from normal financial management — without it, officers confirmed, almost all councils in England would technically be insolvent.

The council is expecting to receive a High Needs Stability Grant in October 2026, which would clear 90% of the current deficit. However, that payment depends on the Department for Education (DfE) approving Norfolk's SEND Reform Plan. If approval is delayed, a second opportunity to receive the grant exists in February 2027.

Officers warned that if the plan is rejected outright, Norfolk County Council could continue operating normally until March 2027 but would then potentially need to issue a Section 114 notice — the formal declaration used when a council cannot balance its budget.

The Government has indicated it will provide further financial support over the next two years, recognising that DSG deficits will continue to grow until April 2028, when SEND reforms are expected to shift High Needs Block funding to central government. Officers stressed that Norfolk is only at the beginning of that process.

Deputy Leader Cllr Robin Hunter-Clarke confirmed the administration would continue to advocate for fair funding for large rural areas like Norfolk, where delivering services is significantly more costly than in urban authorities.