Schools are wasting money by applying for education health and care plans (EHCPs) for pupils who do not need them, a government adviser has reportedly warned.
Tony McArdle, who is advising the Department for Education's review into support for pupils with special educational needs and disabilities (SEND), made the claims in a meeting with local authority leaders, minutes reveal.
His comments have come to light the day after hundreds of headteachers submitted a petition to Downing Street demanding more money for pupils with SEND, ahead of next week's Budget, and described underfunding as an "act of aggression and neglect".
They also follow a backlash from headteachers over Ofsted's suggestion that schools are "squandering" money.
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Mr McArdle, lead commissioner at Northamptonshire County Council, is chairman of the DfE's SEND Leadership Board and an independent adviser to the government’s ongoing SEND review.
The minutes quoting Mr McArdle are from a meeting he attended on 27 January with members of the f40 group, which represents the local authorities with the lowest funding for education.
Mr McArdle, the minutes state, "believed there was a lot of money wasted in SEND, particularly because of the structure, but also because of the way it was operated".
He felt EHCPs "were a fundamental point of failure within the system and didn’t work for a variety of reasons".
The minutes continue: "He said in some cases, parents and schools were applying for EHCPs when they were not justified by the need presented, meaning money was being wasted."
"He acknowledged there were major problems with the current system, not least with EHCPs, but said not all local authorities and schools were spending their budgets wisely and some were managing better than others," the minutes say.
He added that "the perception was that the quality of leadership in SEND could be better".
The number of EHCP requests has spiralled in recent years, but around one-in-four are being turned down.
Geoff Barton, general secretary of the Association of School and College Leaders, said the “totally insufficient” amount of money available overall meant that schools were left with no choice but to apply for care plans to support their pupils.
He said: "The problem with SEND funding is that it is totally insufficient.
"Schools are left in an impossible position whereby there is not enough money in their budgets to afford the cost of supporting children with special educational needs, and the only way of securing the funding they need is through EHCPs.
"If schools were able to afford more support for early interventions this would reduce demand for EHCPs but this is not the reality of the funding situation in education at present."
The DfE has pledged an extra £780 million for SEND in 2020-21, although many education leaders and funding experts say this is not enough.
Julie Cordiner, a school funding consultant and former member of the DfE's school funding advisory group, said: "The inadequacy of funding for SEND is at the root of all the current problems."
This was leaving local authorities "without the capacity to carry out statutory duties and to provide sufficient funding to schools for pupils with high needs", added Ms Cordiner, who runs the School Financial Success blog.
But as well as extra cash, better teacher training in SEND was needed, she said, to give teachers the confidence to meet pupils' needs.
The DfE issued a call for evidence on SEND funding last May and subsequently announced a wider review into support for pupils with SEND.
A DfE spokesperson said: "Our SEND review will look at how we can improve the support children and young people currently receive so the system works well for everyone, in every part of the country."