Under the changes, Ofsted will refuse to let new homes open in areas deemed unsafe and existing homes in unsafe areas will face closure if they cannot demonstrate that they can protect children.
Care home workers will be required to meet a minimum-level qualification and, to improve transparency, full inspection reports of homes will be published along with details of who owns the home unless that risks identifying the children.
Homes will also be required to inform local authorities when moving children in and out of the area and out-of-area placements that are a "significant distance from a child's home" will need to be approved by a senior local authority official.
Timpson said: “For too long children’s residential care has been ignored – leading to unacceptable failings in the system.
“Our reforms will improve the quality of care and tackle the out-of-sight, out-of-mind culture and poor decision making, so vulnerable children are safe.
“Our package of reforms will remove the secrecy which has shrouded residential care for too many years – shining a light on where local authorities and care homes can do better.”
Natasha Finlayson, chief executive of the Who Cares? Trust, welcomed the changes.
“Currently too many highly vulnerable children are placed in poor children’s homes in the least suitable areas and are looked after by staff who are not suitably skilled or qualified,” she said.
“The proposals announced today are significant steps forward in the drive to improve the quality and accountability of these homes.
“The measures proposed for reducing unjustified out-of-authority placements, which rip children from their roots and undermine their sense of identity and belonging, are extremely welcome.”
As part of the reforms Ofsted will replace “adequate” ratings of homes with “requires improvement”.
Homes that are judged inadequate by Ofsted and fail to improve within a specified time limit will also face closure.
The changes, which include updated statutory guidance on children missing from care, are set out in three consultation documents issued today.
David Simmonds, chair of the Local Government Association’s Children and Young People Board, said that the flexibility to place children away from the area where abuse or neglect has brought them into the care system can be a vital way of giving them a new beginning.
“Councils need to have confidence that the care homes in which they place children will provide the best quality of care for them," he said.
"These proposals to make care home providers more transparent and ensure they work with local authorities and the police when deciding where to open new homes will be an important step towards achieving this."