A Manchester adoption agency is feared to be the first of many to close amid claims that distorted inter-agency fees are deterring local authorities from using voluntary organisations to place children.
A recent report by Bristol and Loughborough universities found that councils were under-estimating the costs of raising children in the care system, compared with buying an adoption placement from a voluntary agency.
The Manchester Adoption Society, which was launched in 1965 and has served about 2,000 families, has announced that it will shut in February 2010. Director Rob Finney admitted the agency had struggled in the economic downturn but this had been made worse by the structure of inter-agency adoption fees.
The fees are intended to allow adoption agencies to recoup the costs of recruiting and approving prospective adopters, when local authorities commission their services.
However, Finney pointed out that the Bristol research, commissioned by the Department for Children, Schools and Families, “demonstrates clearly that it is impossible for a voluntary adoption agency to fully cost-recover, so the placement of children relies heavily on charity donations”.
He added: “The way that our fees are set means we have to charge substantially more than local authorities. So it is difficult for local authorities to use voluntary agencies due to an unrealistic discrepancy between what local authorities charge each other and what we have to charge, despite little difference in actual costs in providing adoptions between the two sectors.”
Good success rate
He feared other voluntary adoption agencies would find themselves in the same position. This would leave “even more of the 4,000 children currently needing adoptive parents spending longer in the care system than is necessary”.
The DCSF research also found that voluntary adoption agency placements would save local authorities about £25,000 for each year (after the first year) that the child is not in care – and that voluntary adoption agencies had a good success rate for placing sibling groups and other difficult-to-place groups.
Since its inception in 1978, the charges associated with inter-agency fees have resulted in disputes between local authorities and voluntary adoption agencies. Three reviews of the fee have failed to reach a satisfactory conclusion.