The government has been urged to look again at the structure of inter-agency adoption fees amid fears that more voluntary agencies could follow Manchester Adoption Society in closing.
Manchester Adoption Society, which will close in February after 44 years, said it relied heavily on donations to fund its service and these had been reduced in the recession.
However, it also blamed the “unrealistic discrepancy” between the fees it charged councils for placing children with prospective adopters, and those charged by councils offering the same service.
A report by Loughborough and Bristol universities, published in September, said the benchmark fees paid by councils in 2008 were £12,660 for an adoptive family approved by another council, and £19,889 for families from voluntary agencies, with an additional £3,315 to cover post-adoption services.
It found that councils did not include certain expenses, such as overheads, when calculating their costs, but these were included by charities. Julie Selwyn, one of the report’s authors, said this created a “disincentive” for local authorities to use voluntary organisations.
David Holmes, chief executive of the British Association for Adoption and Fostering, said: “If the operation of inter-agency fees is not working as well as it should, it must be looked at so that we do not lose any more of the most effective and innovative agencies we have.”