More than one in ten councils are having to submit to closer government monitoring of their school finances as falling pupil numbers, spiralling costs and the SEND funding crisis devastate balance sheets. In 2020, the government to tackle financial mismanagement in maintained schools. They included the power to demand 鈥渉igh-level鈥 action plans from councils with a certain proportion of schools in deficit. Data obtained by Schools Week shows 11 councils submitted a plan in the 2021-22 academic year; 15 in 2022-23. This year, 17 councils submitted plans before term even began 鈥 most of them in deprived areas. This year, councils were asked to submit action plans if more than 10 per cent of their schools had a deficit of more than 5 per cent. In 2021-22, the Education and Skills Funding Agency set the deficit threshold at 10 per cent. In 2022-23 it was 7 per cent. However, plans can be requested at any point during an academic year, so this year鈥檚 number is likely higher. The data does not include any plans submitted after August 3, the date of our request. Schools Week also revealed earlier this year how town halls were having to sign off on more 鈥渓icenced鈥 deficits for their primary schools. Twelve of the 17 councils submitting action plans this year are in areas with above-average free school meals eligibility. Eight are London boroughs. Rising costs ‘not addressed’ by government funding Bristol City Council, which has 12 schools with a deficit of more than 5 per cent, is forecasting an overspend on its dedicated schools grant of 拢18.5 million. The 鈥渕ain driver鈥 is in high-heeds top-up and placements costs. The council plans to consult on 鈥渕itigations鈥 that could save 拢12.6 million by 2027-28. These include ensuring top-up funding for schools is 鈥渞obust, appropriate, time-limited and impactful鈥. A spokesperson said rising costs, increased demand on SEND services and a growing population were 鈥渁ll factors yet to be addressed by government funding of schools, which is pushing many across the country to return deficit budgets鈥. In London, however, falling rolls are driving much of the pressure. Southwark, which has nine schools above the threshold, has already removed 420 surplus reception places since 2017. But a council report said the reduction had 鈥渘ot kept pace with the overall drop in demand鈥. 鈥淭his has put extraordinary financial pressure on 鈥 Southwark schools in managing their finances within a continually decreasing funding envelope.鈥 If the council does nothing, it predicts a 拢10 million deficit in the next two financial years. It is considering 鈥渋nformal鈥 capping of reception intakes, and closing and amalgamating schools. London schools need ‘increased funds’ The DfE said its monitoring scheme would mean 鈥減arents can feel assured that the money their schools spend is focused on making sure children get a great education鈥. Schools Week reported earlier this year that the wider crackdown, initiated by Lord Agnew, the former academies minister, had revealed how more than one in three councils reported school funding fraud over two years. Michelline Safi Ngongo Eight councils also stripped schools of budget powers because of financial issues in 2020-21. But councils want more support. In Islington, 20 schools are in deficit, double last year鈥檚 number. A council report blamed falling pupil numbers, rising home education and increases in SEND, while per-pupil funding has been 鈥渟ignificantly less than the increases in energy costs and likely staff pay awards鈥. Michelline Ngongo, Islington鈥檚 executive member for children, said pupil numbers were unlikely to stabilise until 2030, 鈥渟o we’d urge the Department for Education to come forward with a standalone proposal with increased funds to support inner London schools鈥. Gateshead council also said academy trusts could 鈥減ool budgets and direct resources or reserves to schools that require additional support鈥. But that option was only available to mainstream schools if they de-delegated revenue funding annually, 鈥渨hich in effect is a top slice. With budgets being so tight, this could lead to more schools not being able to set a balanced budget鈥. The councils told to submit action plans Bristol: 12 schools Cheshire East: 6 schools Croydon: 6 schools Gateshead: 7 schools Gloucestershire: 10 schools Greenwich: 6 schools Islington: 7 schools Lambeth: 11 schools Liverpool: 13 schools North East Lincolnshire: 2 schools Reading: 7 schools Southampton: 8 schools Southwark: 9 schools Sutton: 3 schools Waltham Forest: 5 schools Westminster: 9 schools Windsor and Maidenhead: 4 schools