Adoption: Research finds agencies may offer better value

The Department for Children, Schools and Families has highlighted research suggesting that councils could secure greater value for money by making more use of voluntary adoption agencies (VAAs).

While the DCSF has not called on councils to increase their use of VAAs, it said today’s research could help authorities “better structure their looked-after children budgets” and would inform a “ministerial stocktake” on the provision of children in care services due this November.

Cost perceptions challenged

The DCSF-commissioned research, which examined the finances of eight local authorities and ten VAAs, challenged councils’ perceptions that using VAAs, which involves paying an inter-agency fee worth £23,204 in 2008, increased costs.

The authorities that spent most on inter-agency fees as a proportion of their adoption budgets, tended to spend less money per placement as a proportion of salary costs in their adoption teams. Spending on the inter-agency fee varied from 1.5% to 18% of councils’ adoption budgets.

The research, by teams at Bristol and Loughborough universities, went on to show that the inter-agency fee fell far short of the average cost per adoption paid by agencies.

Similar spending by councils and agencies

And it found that when spending on overheads were taken into account expenditure by agencies and local authorities’ in-house teams per adoption were very similar, at £36,905 and £35,340 respectively.

The report also pointed out that agencies tended to handle more challenging cases, with 20% of children placed by agencies being over four years old and from an ethnic minority community or sibling group, compared with 9% of those placed by councils. 

It estimated that every child placed by a VAA saved the local authority £25,000 a year in foster care costs, besides the benefit to looked-after children of adoption in terms of greater stability.

Decline in adoptions

The research said that one of the factors in the decline in the number of adoptions in England, from 3,800 to 3,200 from 2003-4 to 2007-8, had been councils’ perceptions that the inter-agency fee was too expensive.

It said a “common approach” undertaken by councils seeking to place a child for adoption was to use in-house services first, then local authority consortium arrangements, then advertisements and then finally to approach VAAs.

The report also cited a survey of 16 VAAs published in 2007, in which 60% said they did not recover all of their expenditure and 40% expressed concern over their long-term viability. There are currently 27 VAAs in England – and 31 overall in Great Britain – that provide placements.

National minimum standards

The research was published as part of the DCSF’s adoption research initiative, and issued alongside proposed revised national minimum standards on adoption services.

Unlike current standards, these stress that local voluntary adoption agencies, along with councils’ family finding teams and consortium partners, should be involved “at an early stage” in helping find adoptive parents when a child is placed for adoption.

Looked-after children’s social workers would also be required to “work closely and timeously” with family finding teams, consortium partners and VAAs to find approved adopters to meet children’s needs.

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