Average weekly rates across the regions ranged between £3,600 and just over £4,000 and, rather surprisingly, the North East region came out on top whilst the South East region was lowest. At £3,734, London is perhaps lower
than might be expected, however the data used by the local authorities to collate responses may well include out-of-county placements. The recent LaingBuisson Children’s Services UK Market Report notes a clear shift from ‘in area’ to ‘out of area’ placements in recent years, with 43% of looked after children in residential care being placed outside of the relevant council area at 31 March 2018, reflecting a shortage of suitable places in the locality.
Of the 141 responses received, 100 reported no increase in fee rates year-on-year, representing almost three-quarters of responding local authorities. Of the remaining 41 responses, 25 reported a year-on-year increase of up to 5%,whilst 8 responders reported increases exceeding 10%. The latter may, in part, be driven by interpretation of the data request, which may simply be determined as the overall increase in cost year-on-year, which may be a function of the majority of placements being made on a spot basis (and often short-term), meaning inflationary y increases are not necessarily automatic.
The data received does appear to indicate a certain level of traction as far as rate increases are concerned. However, considered against the ever increasing cost pressures resulting from wage inflation pensions and regulatory fees, it generally suggests a continued squeeze on provider margins in the majority of locations.
LOOKED AFTER CHILDREN
Across the West Midlands, 85% of looked after children are supported by independent providers, with the next highest region being Yorkshire & Humber at 71%. Conversely, only around a third of looked after children across the east of England are within independent settings.
Given the trends discussed previously, we would anticipate the proportion of looked after children in independent residential care to increase in the future.
The LaingBuisson report notes a strong upward trend in the volume of homes (rather than places) in the last two years as many independent sector providers have expanded to meet higher demand.