I honestly don't think it can work in the current system. I agree with you, Star, that it could work for some children but for the majority the timeline is:
Year R: 1:1 support with activities. Play either in same room as or, if lucky, alongside peers.
Year 1: 1:1 support plus withdrawl for phonics/reading/literacy/numeracy. Drift further behind peers. Play alongside or in same area as peers.
Year 2: 1:1 support with withdrawl/different work for all areas. School concerns about inappropriate peer group. Motion made to move to Special School.
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Year 3: Year almost lost due to adjustment to special school
Year 4: Starting to make some progress
Year 5: Progress made - transition to Secondary planned.
Year 6: Progress made.
How is that fair to a child? If mainstream 'works' why is it that it is well known that Year 3 is a typical 'step off' point into special?
Why is special derided as 'babysitting'? I was in a PMLD class yesterday and it was absolutely full to the brim with activity. The children each had individual plans for the day and every moment was used to the good of them. You may not have seen that when you went to view it, because for those children it is 'normal' to have continuous provision of physiotherapy, OT, SALT, etc. You may have seen someone just sitting down with a toy. What you wouldn't see is that 5 minutes ago they had to do something really difficult and demanding and the 5 minutes just sitting is their reward.
What always strikes me is that so often the things that are being battled for in tribunals and statements are a special school's 'bread and butter'. For example, due to the nature of the SALT provision, everyone gets it. Now it's unlikely, granted, that a child at Special School wouldn't need SALT, but even if they didn't, they'd still get the benefit.
At special school DD1 can sound like she's just had fun all day. She came home the other day and said that she'd been on a tiger hunt. One of the LSAs had facepaint,etc and was the tiger. But that 'tiger hunt' was packed with numeracy, literacy, sensory, etc.