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  1. Policy and practice
  2. The Care Review call for ideas

Care Review - call for ideas

The proposals below were submitted to the Care Review's 'call for ideas' in December 2021. These are published as summarised for the Review's requirements, but include links to fuller descriptions where appropriate. 

Children England also supports the ideas submitted to the Care Review by the Alliance for Children in Care and Care Leavers which you can read here.

Care Review ideas - the Care Bank

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The idea

The Care Bank is a new national public body with a duty to every child on a care order. With funding directly from the Treasury, it pays for all placements including adoption, fostering, residential and the costs of kinship care. It does NOT influence decisions about placements, but frees local authorities to work with each child to make the decision that is best for them without reference to the cost. 

Each provider of care has one business relationship - with the Care Bank - and must work with open book accounts. The Care Bank can monitor providers for their sustainability, profit margins and investment in decent pay for the workforce. It has regulatory power over mergers and acquisitions. 

The Care Bank has a strategic role in foresight planning and commissioning of the types of care difficult to commission locally - specialised care and/or care needed by a relatively small number of children. 

Local authorities retain their corporate parent duties and their power to commission care that is needed locally, empowered by the certainty that the Care Bank will pay for all necessary places.

Government’s response to the public procurement consultation indicates that services such as social care may be exempted from competition in new procurement regulations. We believe that the care system should be one of those exempt sectors, and that the Care Bank would provide a robust alternative procurement framework. 

The impact we hope this will achieve

The Care Bank will rebalance power - away from providers and towards children and their local authority corporate parents. 

- Children, alongside their social worker and prospective carer (as well as their parent where appropriate) can choose the care they feel is right for them, without being influenced by the cost. 

- With the right placement decision made first time, fewer placements will fail and fewer children will need to be moved to different homes. 

- Care Bank Funds follow the child, and the child’s own evaluation of their placement will be the trigger for continued payments, putting the child’s experience of care at the heart of all decisions. 

- Social workers can feel confident putting the child’s needs first and there need be no hierarchy of placements due to availability or price.

- The Care Bank will simplify procurement, making it more transparent and less costly, and ensuring provider finances are fair and sustainable.

- It will enable decision-makers to build a clearer picture of need and provision, and plan strategically for the future, meaning children are less likely to experience out-of-area placements or inappropriate types of care. 

- Local authorities can focus resources on family help and other types of social care children need.

- For an illustrated summary of the main elements and impacts of the Care Bank, click here.

- For a full explanation of the Care Bank and the need for such reform, click here.

Published: 6th January, 2022

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Care Review ideas - the Children Act Funding Formula

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The idea

The Children Act Funding Formula would retain central responsibility for the funding of children and family services from national taxation, enabling local authorities to fulfil their duties under Section 17 of the Children Act 1989. We believe that this legislation remains well-designed to allow councils scope and flexibility to meet each child and family’s unique needs, whether that is simple, practical help or more complex intervention. What has been missing increasingly in recent years is sufficient funding for it. Also missing in current funding is weighting for levels of deprivation, which government data analysed by the Child Welfare Inequalities Project shows is a crucial factor in resourcing local authorities equitably. 

The Children Act Funding Formula would award 3 - 5 year grants to local authorities based on three factors:

  • Current and projected child population
  • Disabled children and young carers
  • Deprivation indices for the area

It would not be ring-fenced but, like Section 17, allow councils to decide in partnership with communities and families how best to spend it for children’s wellbeing.

The impact we hope this will achieve

A fair national funding formula accounting for levels of deprivation would reverse years of growing inequality between areas, during which councils with the highest levels of need have seen the biggest cuts to their budgets, and had the least to spend per child. Whilst accounting for variations in the specific needs of children in each area, it would enable all areas to achieve the same quality of outcomes as each other.

Over the long term, the sufficiency and certainty of the Children Act Funding Formula would allow local authorities to rebalance spending between Section 17 duties (including ‘early’ or ‘family’ help) and more critical interventions that have taken priority while budgets are insufficient to meet all levels of need. Combined with the Care Bank (submitted separately) the Formula would give every area the power and the resources to design services in partnership with local families, and to invest in the holistic support envisaged by the Children Act, from children’s centres to refuges to respite for families with a disabled child. Ultimately, families would receive the support they need to stay together wherever possible and fewer children would need to be taken into care.

- For a full explanation of the Children Act Funding Formula, click here.

Published: 6th January, 2022

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Care Review ideas: Exempt all arrangements for care provision under the Children Acts from public competition rules

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The idea

The Government’s response to the public procurement consultation indicates that the Light Touch regime in procurement of social care services will now be retained. Furthermore, in paragraph 121 it suggests that services such as social care may be exempted from competition rules altogether in new procurement regulations. The care system (any/all kinds of care placements that children need while in care) should be one of those exempted sectors.

Such an exemption would be transformative in freeing local care commissioning from the constrictions (real, and perceived) of compliance with procurement regulations. It would also be liberating for councils to be lifted out of the shadow of threats of legal challenge from ‘market competitors’ if they are ‘excluded’ from chances to compete for new business from them.   

Creative, community-led commissioning, and rethinking of how best to ensure best value without resorting to competition, would still be needed if the exemption were declared. We think the Care Bank idea (submitted separately, and in previous Review submissions) would provide a robust alternative public investment framework and oversight body in what could be a turbulent transition from a national competitive market, to a non-competitive locally driven system that puts children’s needs, views and preferences in the driving seat of determining what kinds of care are funded, and who should run them. But the case for exempting children’s social care from competition rules stands alone, to us, and would be of transformative impact even without the Care Bank.  

The impact we hope this would achieve

One of the most significant benefits of freeing the care system from competition would be the ability to build long-term collaborative partnerships for caring well in local communities; and to reverse the short-termism and instability caused by competitive mechanisms like frameworks and spot purchasing. Councils could construct partnerships with (for example) charities, co-operatives of local foster carers and community social enterprises who commit to be part of the social fabric of that community for many years to come. What care is needed, nurtured, adapted and invested in would be a matter for the council and its community to decide and build together – not open to being seen as a competitive market to be ‘broken into’ by any organisation. 

The Care Bank would support creative local commissioning and co-production with children and families because the Care Bank would make sure the money for their care follows each child, so keeping as many children well cared for in their home authority as possible (and commissioning the people, training, support and places to make that a reality) would bring Care Bank funds into the community to pay for them, instead of sending children away from their community to be cared for far from home. 

Published: 6th January, 2022

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Care Review ideas: Tax all providers of UK public services equally

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The idea

Learning from similar policy reforms recently introduced in Demark, we propose that government should legislate to require that in all public spending decisions about public service contracts, officials must verify (before confirming any final contract award) that any organisation to whom public funds are awarded is paying in full their appropriate taxes to the UK government for the business they do here. This should apply equally to all company forms and ownership structures of firms involved in public service contracting, whether registered as a British business or registered in another country.  

 

The impact we hope this will achieve

At present, markets like those which operate in children’s social care can be treated purely as sources of potential profit for private equity firms and investors, with little incentive for them to invest in good quality services over the long term. Private equity firms anywhere in the world can buy up small British providers, maximise the profits they can make from state contract fees, and then exit the market again after around 3 - 7 years. Complex ownership structures that trace back to registration in tax havens enable the extraction of what the CMA described as sometimes 'excessively high profits' out of the UK economy, without even being taxed properly 'on the way out'.  

We do not suggest that all private care companies, nor indeed all private investors, use such techniques currently, or would countenance doing so. Responsible companies and investors, who conduct their business and tax affairs entirely lawfully, definitely exist and operate ethically within the current market, and would not be the target for this reform. Indeed, making sure that responsible care organisations, ethical employers and caring investors aren’t having to 'compete' with ones that are behaving less ethically, and aren’t paying comparable taxes, to do similar work, in the same country, is one important reason for suggesting this should be a standard requirement in all public procurement conducted with public (ie taxpayers’) funds. 

Published: 6th January, 2022

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