With the proportion of children with statements of special needs rising to 5, 6 or even 7 per cent in some authorities, rather than the 2 per cent envisaged by Warnock, special educational needs are a time bomb, according to Mike Nichol of Coopers and Lybrand, the management consultants who completed a national survey of SEN arrangements for the Department for Education and Employment.

Last year 13 per cent more statements were issued than the year before. Since many of these went to primary pupils who will remain in schools for a further 10 years or more, at the present rate of increase there will be 250,000 more statements in 10 years time, more than double today’s number.

But why should that matter? Don’t more statements mean more money for children with learning difficulties - money that is precisely targeted on needs thanks to the multi-disciplinary assessment statements require? Well, not entirely, it seems. Though some authorities have found extra money to meet the growing demand for statements, increasingly councils are having to dip deeper into the shrinking general schools’ budget for all children to meet the statemented needs of a few; a self-defeating process that leaves schools less able to cater for children with learning difficulties from their diminishing resources and increases the pressure from parents and heads for the kind of earmarked help attached to statements.

Doubts exist, too, about whether this is the most efficient way to meet the needs of those granted the protection of a statement. Administration is costly. One authority’s conservative estimate is that each statement costs more than Pounds 1,000 to issue. So the 900 or so statements produced by that authority cost Pounds 1 million in bureaucracy before any needs were met. That did not take account of the costs of annual reviews required thereafter.

Educational psychologists complain their scarce time is increasingly bound up with administration of statements rather than preventive work and teacher support. Even when additional help is provided through a statement there is little evidence that this is effective, largely because few efforts have been made to check whether the millions involved are spent as intended, let alone whether they are resulting in any improvement.

There is growing concern that far from targeting the greatest needs, assessment and statementing procedures advantage those with the most effective advocates. In a recent study involving 57 pupils in one local authority, the child’s parents had contributed to the assessment in 90 per cent of the cases judged by the study criteria to be “overfunded”; in none of the “underfunded” cases did parents contribute to the assessment.

According to a recent National Foundation for Educational Research survey, local authorities are seeking ways of controlling their escalating special needs budgets. The causes of the statement explosion are manifold. Statements of SEN were introduced 15 years ago in the 1981 Education Act. Since there was no clear legal definition in the Act of what constituted a special educational need, to begin with authorities were able to balance the numbers issued against the funding available. Pressures from parents grew. But they could still be largely resisted by a combination of obduracy and inertia. It often took a year to decide whether to carry out an assessment and longer to provide a statement. Though there was a last resort appeal to the Secretary of State, this often took a further 18 months and required skilled advocacy to persuade department officials to overrule an LEA.

Several factors changed this balance, however. Parental demand grew stronger, better organised and supported by a new branch of the legal profession. Expectations grew about the range of special needs that mainstream rather than special schools should cope with. And the success of Labour and Liberal Democrats in local elections may have resulted in education authorities sympathetic to special needs.

Meanwhile, apparent need, particularly in emotional and behavioural difficulties, has increased. On top of which came a flurry of Government changes that impinged on support for pupils with learning difficulties and schools’ attitudes to them. Local managers introduced greater competition between schools and required authorities to delegate to schools much of what they used to manage centrally.

Many schools, used to the authority providing special help for pupils, failed to appreciate that it was they who now held the funds intended to support non-statemented learning difficulties. Even if they did understand what they had been given and their responsibilities to these pupils, many found themselves forced by education cuts to use these funds elsewhere.

Heads and governors have a legal duty to ensure special needs are met. But as Felicity Fletcher-Campbell says in her report on the NFER survey, “Although there is evidence of money nominally allocated for special education being used for other purposes, there is little evidence that schools do this for any lack of regard for meeting special needs. Rather . . . it is a matter of prioritising and balancing responsibilities to deliver the national curriculum with responsibilities to a minority of pupils with learning difficulties”.

To fulfil both responsibilities schools increasingly looked to the special needs funding retained by the local authority - in most cases for statemented pupils or for what became known as level 3 in the new Code of Practice. This seemed like the one remaining crock of gold. Now heads shared with parents an incentive to see special needs children statemented or otherwise supported out of the central purse.

The Code of Practice time limits removed the authority’s inertia option, provided stages for amassing the evidence needed for a statement and coincided with the creation of a faster appeal tribunal independent enough to side with parents against questionable custom and practice.

In an attempt to put this genie back in its bottle, authorities are trying to rein in demand for statements. So far 11 have managed to do so, according to Mike Nichol.

Authorities control demand in two main ways. In the absence of a national definition of SEN, some try to create their objective criteria and apply these more rigidly. These are set at a level designed to minimise the numbers qualifying.

It is an approach that has difficulties (or advantages if you want a statement) since children rarely fit neatly into categories. Even where the difficulty is cognitive, there are often complicating medical or social factors. Setting criteria for emotional and behavioural difficulties is problematical.

To overcome these problems of definition, some authorities have set up joint school and LEA moderation or auditing processes to ensure common scales of judgment between professionals. This increases administration costs. But some argue that it is worth it. According to Felicity Fletcher-Campbell, special needs audits: * increase awareness of good practice * share ideas * reveal what pupils and teachers in other schools need * widen perceptions of what constitute special needs * raise the profile of special needs * improve record keeping * provide information to justify SEN budgets * improve targeting of resources * track changes over time.

Audit meetings, she found, were catalysts for further co-operation and joint staff development between schools. “Teachers involved in moderation said they valued the experience, particularly of sharing ideas.”

But tightening up on extra funds for exceptional needs tends to question the efficacy with which local management schemes distribute funds in the first place. According to the NFER study, no two authorities go about this in the same way and over half those in its survey had changed their method of allocation recently, often because they were not satisfied that the methods used fitted schools’ needs.

Most LEAs use the percentage of pupils receiving free school meals to indicate the incidence of special needs, though there is little evidence to justify this, according to Felicity Fletcher-Campbell. One authority found that, of its pupils audited at SEN Code of Practice stages 1, 2 or 3, less than half were entitled to free meals. The mismatch was greater with some needs; 59.5 per cent with “learning difficulties” were entitled to free meals but only 21.4 per cent of those with “emotional and behavioural difficulties”, 13.5 per cent with specific learning difficulties and less than 1 per cent with sensory or physical difficulties.

As Felicity Fletcher-Campbell says, taming unruly demand-led budgets is the priority for local authorities. But they have to strike a fine balance. If their restrictions are too severe, they may find other costly problems break out elsewhere, whether it be teacher stress or the rising tide of exclusions as mainstream schools become increasingly reluctant to include some of the more challenging pupils.

The Resourcing of Special Educational Needs by Felicity Fletcher-Campbell, NFER, The Mere, Upton Park, Slough, Berks SL1 2DQ. Pounds 10 including postage