Finding homes for looked after children

Where a local authority is looking after a child and they cannot live with their parents, the local authority must arrange for them to live in the “most appropriate placement available”.

Issues

Local authorities can find it difficult to find suitable placements for all the children they look after (looked after children), particularly those with more complex needs. This can be for several reasons, including:

• The number of looked after children increased by 30.1% between 2010 and 2023 and children are presenting with more complex needs.
• A shortage of suitable placements in a local authority’s area. While the number of children’s homes has increased they are not evenly distributed across the country and only a limited number can provide some specialised types of care.
• Difficulties recruiting and retaining foster carers.

The shortage of suitable placements is said to contribute to several issues in the sector, including:

• Too many children being placed outside their home local authority or a long way from home.
• High costs of placements and alleged profiteering by some providers.
• Increasing numbers of children deprived of their liberty placed in unregistered settings, with no regulatory oversight.

Previous government’s policy

In October 2021, the government announced it would provide £259 million up to 2024/25 to “maintain capacity and expand provision in secure and open residential children’s homes.” At the spring budget 2024, the then government said it would provide a further £165 million over the next four years to create additional places in children’s homes.

Children’s social care reform strategy

In February 2023, the government published an implementation strategy and consultation on children’s social care reform. In part, this formed its response to two reports published in 2022:

• A report published in March 2022 by the Competition and Markets Authority on the children’s social care market.
• The final report of the Independent Review of Children’s Social Care, published in May 2022.

The strategy set out reforms aimed at increasing the number of “high quality, stable and loving homes available for every child in care local to where they are from” by 2027. The proposals included:

• Testing the use of regional care cooperatives (regional groupings of local authorities) to plan, commission and deliver care places in two regional pilots. The pilots had not been launched by the time of the 2024 general election.
• Providing £27 million for a fostering recruitment and retention programme. This was increased to £36 million in December 2023.
• Developing a financial oversight regime covering the largest providers.
• Developing a core set of standards for fostering, children’s homes and supported accommodation.
• Providing national support with forecasting, procurement and market shaping to local authorities.

The strategy rejected a recommendation from the Independent Review of Children’s Social Care for a windfall tax on profits made by the largest placement providers on the basis that it could “either result in providers exiting the market or it would lead to higher prices to cover the cost of the tax.” However, at the Spring Budget 2024, the then government said it would publish proposals later in the year on “what more can be done to combat profiteering, bring down costs and create a more sustainable market for residential placements.”

Labour government policy

In its manifesto for the 2024 general election, the Labour Party said it would “work with local government to support children in care, including through kinship, foster care and adoption, as well as strengthening regulation of the children’s social care sector.” The manifesto did not specifically commit to implementing the previous government’s reform strategy for children’s social care.