In an answer to a parliamentary question by shadow public health minister Sharon Hodgson, Zahawi said the Department for Education believes head teachers should have the freedom to decide how best to spend their budget and has "no plans to ringfence SEN funding".
He said that schools have a number of statutory duties reinforcing the need to support pupils with SEN including complying with the Equality Act 2010, appointing masters-degree qualified SEN co-ordinators, and publishing reports on how they implement their SEN policy.
"The department expects schools to use their full budget to provide the best possible education for all their pupils including those with special educational needs," he added.
The suggestion of ringfencing the money follows Ofsted's latest annual report, which criticised mainstream schools for "unacceptable" treatment of SEND pupils.
Problems identified by the inspectorate include some schools being unable to support children's needs, asking parents to keep their children at home, and school leaders failing to monitor the effectiveness of SEND support their school provides.
Councils have also warned that current levels of funding fail to meet the rising costs of supporting pupils with SEND.
In January, the Local Government Association launched a review of the system for providing support to children with SEND.