Three families of children with special needs are taking the government to court over its lack of special-needs funding, which is “leaving thousands of children across the country in limbo”.

The families, from North Yorkshire, Birmingham and East Sussex, have formed a group called SEND Family Action and have been granted legal aid to mount the High Court challenge against the government’s funding policy for special educational needs and disabilities (SEND).

They include the family of Dakota Riddell, aged 9, from Birmingham (pictured), who has cerebral palsy, among other conditions, and whose local authority transport was withdrawn following errors on her education, health and care plan, which was not updated for three years despite a significant increase in her need for care and support.

Her mother, Mary, said: “Thousands of children with specialist and complex needs, who through no fault of their own require support, are being left in limbo because of how government hands money to councils.

“From our experience and from what other families have told us, it is abundantly clear councils feel that the funding made available from central government is insufficient.”

Acting for the families, solicitors at Irwin Mitchell have now asked the High Court for a judicial review into the legality of how the government provides funding to local authorities.

The move follows successful legal action in August that led to a High Court judgment barring Bristol City Council from slashing £5 million from its budget for SEND pupils. 

Meanwhile, the government last week pledged to increase SEND funding by £350m over the next two years.

But a survey of 73 councils, carried out by the Local Government Association, suggests that it might not be enough. The results of the survey suggest a projected shortfall of £536m in funding for SEND support for 2018-19 - more than double the gap last year.

The parent group has so far raised more than £12,500 through an online crowdfunding page on which it highlights the increasing number of SEND pupils being off-rolled or “unlawfully excluded, with parents left to educate them at home with little or no professional input”.

The group is calling on education secretary Damian Hinds and chancellor Philip Hammond to increase funding to local authorities.

The group includes the family of Nico Heugh Simone, 15, pictured above with his mother, Lorraine, who has been in “a constant battle” with East Sussex County Council over funding to support him in mainstream school with his autism and anxiety.

The group also represents the family of Benedict McFinnigan, 14, from Scarborough, who is diagnosed with post-traumatic stress disorder, anxiety, depression and chronic insomnia; he was initially refused an education healthcare assessment by North Yorkshire County Council, which said he did not meet its SEND requirements. Benedict has been educated at home and in a pupil-referral unit for the past two years.

Anne-Marie Irwin, specialist public law and human rights lawyer at Irwin Mitchell, said: “We have heard extremely worrying first-hand accounts from the families we are supporting about the issues and obstacles their children have faced.

“How local authorities fund special educational needs is a major issue nationally and will only become more acute, as local authorities continue to feel that they have no option but to further squeeze services in light of continued budget cuts.”

Irwin Mitchell is also representing SEND families in Hackney, Surrey and Somerset who are opposing local authority cuts to services in their area.

Judicial reviews to decide the legality of Surrey County Council’s and Hackney Council’s decisions to reduce their SEND budgets have already been heard, with decisions due at a later date.

Pupils with identified SEND account for almost half of all permanent exclusions, and more than 4,000 SEND pupils were left without a school place last year compared with 776 in 2010, according to Department for Education figures.

The government’s children and families minister Nadhim Zahawi said: “We want all children to attend a school that supports them to thrive, go on to higher or further education or training, find a job that’s right for them, and to live happy and fulfilled lives. 

“Our ambition is for children with special educational needs and disabilities is no different - we want them to enjoy school and achieve as highly as possible. This is why we are investing £6.1 billion into provision for those with more complex needs in 2018-19, including an additional £125 million announced earlier this week. This will rise to nearly £6.3bn in 2019-20.”