Should – and could – councils reduce their reliance on independent fostering agencies?

Most people involved in fostering would agree there is a crisis in the recruitment of carers.

Over the past five years, the number of approved fostering households in England who are not family and friends carers has decreased by 3% to 37,325, with no change in the number of placements available primarily for permanent care and a fall in those for non-permanent care.

The number of children in placements rose by 9% over the same period.

So, it was not surprising that the Competition and Markets Authority recommended action to boost foster carer recruitment, in the final report of its study of the children’s social care market, published last month.

The CMA called on all three national governments within the UK to provide more support for councils in forecasting demand for placements, to conduct annual assessments of the need for foster carers and to develop strategies to improve recruitment and retention off the back of these.

But some fostering leaders have questioned why the markets watchdog called for the focus of additional recruitment to be on councils’ in-house foster carers – and for the government to fund local and regional schemes that enable this.

The Nationwide Association of Fostering Providers (NAFP), which represents independent fostering agencies, has – perhaps unsurprisingly – queried “indicative evidence” presented by the CMA that councils can provide some placements more cheaply than IFAs.

Others have questioned councils’ capability to boost carer recruitment after their apparent lack of success in doing so over recent years, despite it being a key priority.

Cost gap between councils and IFAs

The CMA report concluded local authorities “could provide some placements more cheaply” than by purchasing them from IFAs, “if they are able to recruit and retain the necessary carers”.

The “indicative” evidence the CMA based this on was in the accompanying appendices to its main report, in which the watchdog compared average allowances, fees and overheads per child between 27 local authorities and eight large private providers.

It found overall operating costs per child were £8,400 higher at the IFAs than the councils in 2020 (£35,100 compared with £26,700), and, on average, 26.2% higher between 2016 and 2020. It also found IFAs paid both significantly higher fees to carers and had higher other costs (overheads) per child than councils.

Including profits, it found a difference of 40% between the total cost of an IFA placement compared with an in-house placement for a local authority.

More complex needs

But the CMA acknowledged there were “many difficulties in making like-for-like comparisons” between IFA and in-house placements due to the “different roles” played by each type of provision, with agencies potentially offering placements for children with more complex needs.

The 2018 government-commissioned review of fostering by Sir Martin Narey and Mark Owers supported this view, finding that children cared for through IFAs tended to be older and more likely to have special educational needs, substance misuse issues and emotional or behavioural problems.

The CMA also said local authorities were more likely to fill their in-house placements first over IFAs, meaning they had less spare capacity, resulting in lower costs per child. Councils’ reported costs may not include all overheads, although the CMA said it tried to minimise the risk of authorities underreporting these figures.

The watchdog did not recommend limiting or banning profit-making in foster care – because it was unsure councils would be able to recruit enough carers or provide the same quality of care, at a similar price, across the full range of needs.

Nevertheless, the CMA recommended governments should offer funding support for “innovative projects” run by individual councils, or by groups of them, to recruit and retain more foster carers and reduce their reliance on IFAs.

Councils’ ‘strong track record’

In the face of widespread placement shortages, many councils have already prioritised recruiting and retaining more foster carers over recent years through their sufficiency strategies for children in care.

For example, an Oxford University study from 2018 found “nearly all” participating London boroughs aimed to increase their in-house foster care capacity and reduce reliance on IFAs. This was on grounds both of cost and being able to place children closer to home.

A spokesperson from the Local Government Association, which welcomed the recommendation for more money to support councils’ recruitment of foster carers, said councils have a “strong track record in recruiting and supporting foster carers”. 

Around two thirds of foster carers choose to foster for their local authority, the LGA spokesperson said. “Additional support from the government to expand and build on this, and to trial new approaches, would help to ensure we have the right foster carers, in the right places, to make sure every child is able to live in a loving, stable home that allows them to thrive.”

Recruitment and retention struggles

While across the UK, councils are responsible for most fostering placements, with IFAs accounting for 36% in England, 31% in Scotland and 27% in Wales, statistics suggest the extra support is needed. 

There have been notable recent recruitment successes. For example, a campaign planned in Hertfordshire just before the first lockdown, which the council adapted and moved online, saw the number of local foster carers taken on double. But overall, ambitions to grow local authority capacity have not been bearing fruit. 

Ofsted’s fostering statistics for the year to 31 March 2021 showed that IFAs in England increased capacity by 525 households and 765 placements – while councils lost 35 households and 325 places overall.

Capacity at IFAs has outpaced council places in recent years – the number of filled places in England grew by 20% for IFAs from 2017 to 2021 (16,725 to 20,065) but by just 3% for LAs (34,880 to 35,925).

Speaking to Community Care, NAFP chief executive Harvey Gallagher said the CMA contradicted itself by suggesting a move towards in-house carers while also accepting that authorities would struggle to replace IFA carers. The report says: “We see no reason to believe that local authorities can recruit or retain the same sorts of carers as IFAs are recruiting”.

And he queried the CMA’s conclusions on the relative cost of council and IFA placements.

Gallagher also raised questions as to how successful the watchdog’s proposal that the government provide financial backing to pilot schemes aimed at boosting fostering retention would be.

“Local authorities continue to try to recruit more in-house carers, why would they not? [But] by and large it is the IFAs that have met the need for more foster carers across England,” Gallagher said. “I don’t think there is any reason to believe [new pilot schemes] would work.”

Fostering ‘should not be seen as competitive market’

Others in the fostering sector agree.

Andy Elvin, chief executive of TACT fostering charity, echoed Gallagher’s doubts as to whether local authorities would be able to recruit more in-house foster carers through the CMA’s proposed pilot schemes.

“Carer recruitment is not something local authorities are really geared up to do on a business basis,” Elvin argued. “Children’s services don’t tend to have marketing and recruitment staff [within children’s services teams].”

Local authorities are already “doing their absolute best to recruit foster carers in their area”, added Emma Fincham-Siley, fostering consultant at CoramBAAF.

“I don’t think it is necessarily that they have got a huge pool of carers they are just not able to tap into or work with,” she says. “I think any area is only going to have a finite number of families that will be able to provide these homes.”

Fincham-Siley said a “cap on the amount that some placements cost” would have been a better recommendation and that greater collaboration between councils and IFAs should be encouraged instead of pitting them against one another.

“It’s better to look at the skills and expertise that private fostering agencies have, and likewise with local authorities, and for there to be a real culture shift, a real change about bringing those organisations together and not viewing this kind of work as a competitive market,” she said.