LGA: Children’s social care costs will rise by £600m a year

“Despite increasing their budgets for children’s services by diverting funds from other areas, councils are still overspending due to soaring demand for support which is likely to increase further as the long-term impacts of the pandemic become clearer."


Close up of a child drawing with a pencil

Soaring demand to help safeguard children will see future cost pressures in children’s social care increase by an estimated £600 million each year until 2024/25, the Local Government Association warns today.

The LGA is calling on government to use this week’s Spending Review to fund these future cost pressures and work with councils to prioritise a child-centred recovery plan as part of its shared ambition with councils to level-up communities and reduce inequalities across the country.

The LGA says projected costs in children’s social care in England will rise from £10.9 billion in 2021/22 to £11.4 billion in 2022/23; £12.1 billion in 2023/24; and £12.6 billion in 2024/25 – an average of £600 million each year and a 16 per cent rise over the three-year period.

Councils are concerned about children, young people and families needing more support as they struggle to deal with the ongoing impacts of the pandemic. Falling benefit rates, including the end of the Universal Credit uplift, and rising fuel and food costs, are also likely to affect many low-income households, particularly those with children, which councils fear could lead to more referrals to children’s social services.

Despite COVID-19 exacerbating the strains on children’s social care services, these services were already under significant financial pressure before the pandemic. Research shows that spending on preventative children’s services fell from 41 per cent of children’s services budgets in 2010/11 to 25 per cent in 2017/18 - driven by significant reductions to council budgets over the last decade and increasing demand for child protection services. 

Meanwhile, the number and proportion of looked after children has been rising year on year for over a decade. In 2009/10, 64,470 children were in care, or 57 in every 100,000. In 2019/20, that figure was 80,080 or 67 in every 100,000. Placements for some children cost more than £260,000 per year. 

Rising cost pressures and demand for services mean that despite budgets for children’s social care rising by more than £1.1 billion between 2017/18 and 2019/20, more than eight in 10 councils were still forced to overspend to ensure children were protected.

The LGA is calling on government to fund the existing pressures on children’s social care, worth £1 billion, as well as future cost pressures estimated at £600 million each year of the Spending Review, and to implement a cross-Whitehall strategy to support children, young people and their families. 

Cllr Anntoinette Bramble, Chair of the LGA’s Children and Young People Board, said:

“Supporting and protecting vulnerable children is one of the most important roles played by councils who want to ensure all children are safe, loved and thrive.

“Despite increasing their budgets for children’s services by diverting funds from other areas, councils are still overspending due to soaring demand for support which is likely to increase further as the long-term impacts of the pandemic become clearer.

“The end of the Universal Credit uplift and other COVID-related support could combine with rising fuel and food costs to increase pressures on many low-income families. This risks increasing demand on children’s social services which is already unsustainable.

“Councils want to work with government to prioritise a child-centred recovery plan which ensures no child is left behind as we recover from the pandemic. This must include fully funding children’s services so councils can protect children at risk of harm by providing the early intervention and prevention support that can stop children and families reaching crisis point in the first place.” 

Notes to Editors

  1. Referral levels to children’s social care.
     
  2. Placements for some children cost more than £260,000 per year, according to Children’s Commissioner report Estimating children’s services spending on vulnerable children.
     
  3. A lower-income couple with two young children where one adult is working full-time is going to need to find an additional £31-a-week to cover the cost of living and falling benefit rates from October, according to analysis by the Joseph Rowntree Foundation.
     
  4. Spending on preventative children’s services fell from 41 per cent of children’s services budges in 2010/11 to 25 per cent in 2017/18, according to National Audit Office report Pressure on children’s services (page 34).
     
  5. LGA research: More than eight in 10 councils were forced to overspend on children’s social care budgets.