This report examines the challenges faced by local authorities in providing cost-effective, high-quality residential care for looked-after children in England, where numbers have risen to 83,630 as of March 2024. It highlights that costs nearly doubled between 2019-20 and 2023-24 to £3.1 billion, driven by high demand, a largely private provider market, and insufficient provision for children with complex needs, resulting in placements that may not meet children’s needs. While the Department for Education has begun addressing these issues through investment in preventative care, fostering, and legislative measures to improve oversight and collaborative commissioning, the report emphasizes the need for clearer market guidance, better understanding of system dynamics, and stronger support for local authorities to ensure value for money and effective outcomes for children.
