Children’s trust to be disbanded as council takes services back in-house

A children’s trust will be disbanded with services returning to council control later this year.

Worcestershire County Council will take back control of early help, children’s social care and education services when its current contract with Worcestershire Children First ends in September 2024.

WCF’s staff – numbering 942.01 as of September 2023 – will transfer to the county council at the same time.

Improvements under trust

The move comes despite services progressing from requires improvement, in 2019, to good, in 2023, in Ofsted’s view, under WCF’s stewardship, and the company consistently meeting targets set by the council.

In a report to the council’s cabinet earlier this month, leaders justified the decision on financial grounds and on the benefits of reintegrating children’s services into the wider authority.

While the company – whose gross expenditure budget is forecast to be £148.4m this financial year – made small surpluses in its first three years, it overspent by £7.6m in 2022-23 and is forecast to do so by £28.6m in 2023-24.

The cabinet paper said this had been driven by national cost pressures on care placements and claimed that the council could save about £200,000 a year from winding up the company. This would remove the need for the post of director of resources at WCF as well as those of chair and non-executive directors on the company board.

However, in a response included in the report, the WCF board pointed out that these savings were “small and will not immediately aid our overspend situation and some of our financial challenges, which are driven by national market conditions”.

DfE direction for council to lose control of services

The Department for Education determined that Worcestershire should lose control of its children’s services in 2017, on the recommendation of a DfE-appointed commissioner, and following an inadequate Ofsted rating earlier that year.

The following year, the DfE approved the council’s business case to set up a company it wholly owned to run services and, in 2019, WCF was established, with a five-year contract to deliver social care, early help and education.

Prior to the transfer, Ofsted reinspected the council in 2019, leading to a requires improvement rating, which WCF has improved further, earning a good grade last year.

Ofsted’s praise for trust 

In their 2023 report, inspectors praised WCF for making “significant progress” in improvement areas identified in the two previous inspections and said most staff were positive about working for the trust, due to its supportive culture and accessible leadership team.

In comments to councillors in September 2023, WCF chief executive and Worcestershire’s director of children’s services, Tina Russell, said the improvements had not been driven by setting up the company, but by strong leadership and additional investment.

However, in its comments on the council’s proposal, the WCF board raised concerns about the potential disruption to the children’s services’ leadership team of winding up the company.

Trust board’s concerns over potential disruption

It said “extremely strong leadership with considerable focus on performance and continuous improvement” was behind the good rating from Ofsted and the importance of maintaining the stability of the existing leadership team “cannot be emphasised enough”.

“The senior leadership have forged positive working relationships with a wide range of stakeholders including the regulators and any change may be considered detrimental by stakeholders and be an unwanted distraction given the challenges we face in trying to reduce our budget overspends in residential care and improving our [special educational needs and disability] performance,” the board added.

Taking back control ‘the right thing to do’

In a statement on the decision, the county council’s cabinet member for education, Tracey Onslow, said: “Bringing children’s services back to the county council once the contract has ended is the right thing to do.

“The wholly owned company was set up at a time when Ofsted deemed our children’s services to be inadequate. Thanks to the hard work and dedication of our officers we have seen this rating rise to good at our last inspection in 2023.

“Our officers…will transfer back to the county council and will continue to work tirelessly to deliver quality services and support for the children of Worcestershire.”

The state of the trust model

Worcestershire’s move will leave 11 of the 153 local authority children’s services under trust stewardship, and marks the second time in two years that a council has taken children’s services back in-house, following Doncaster’s decision to do so in 2022.

Doncaster’s trust was set up 10 years ago, at the DfE’s direction, while in the same year, Kingston and Richmond councils voluntarily set up a community interest company – Achieving for Children – to run their services.

A DfE-directed trust was established in Slough in 2015 while in 2016, ministers set an ambition of having a third of children’s services being delivered through trusts or other alternative delivery models (ADMs), such as partnerships between councils.

Spate of trusts created

Over the subsequent four years, trusts were set up in Birmingham, Northamptonshire, Reading (Brighter Futures for Children), Sandwell, Sunderland (Together for Children), Windsor and Maidenhead (under Achieving for Children) and Worcestershire.

However, since then the tide appears to have turned away from the trust model, with only one created during that time, in Bradford.

During this time, trusts and ADMs have been considered in other areas subject to government intervention due to poor performance and eventually rejected on the advice of DfE-appointed commissioners.

A common reason proffered by commissioners has been the potential disruption to improvement plans by creating new organisations from scratch.

Also, in two of the areas where a trust was considered – Medway and West Sussex – the authority has made significant improvements, with the former earning a good rating and the latter a requires improvement grade, with good features, last year.

Structural change ‘not panacea for performance issues’

In addition, a report for the Local Government Association in 2022 found that large-scale structural change was not a panacea for councils’ performance problems, drawing on the experience of children’s trusts.

The study concluded that factors such as political will, specific leadership qualities and the willingness to take a long view around achieving service improvements were the most important enablers of successful change.