- The council has partnered with Barnardo’s to generate additional provision and plans to open two new homes of its own soon
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Six councils in the Liverpool region have also developed a local framework with providers to boost provision for local children
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Liverpool City Council has embarked on an ambitious redesign of its children’s residential care model in a bid to improve long-term outcomes for its looked-after children and young people.
Now, some 18 months into the process, the local authority says it is starting to see the “green shoots” of its new approach. It has been working on both a local and regional level to reduce reliance on private sector providers and to address the issue of inflated placement costs.
At the heart of Liverpool’s model is a belief that demand for children’s residential care can be more effectively met through a range of provision rather than any one part of the sector.
A recent interim report from the Competition Markets Authority highlights significant ongoing challenges facing local authorities wanting to place children and young people in residential care. It sets out the difficulty in finding appropriate accommodation for children that meets their needs combined with increased costs for such placements (see Policy).
The report also focuses on some of the largest private providers earning higher profits than it would expect in a “well-functioning” market. It states that if the market was better balanced, there should not be an under-supply of placements and “elevated prices and profits persisting over time”. Instead, there should be an expectation that existing and new providers would create more places to meet the demand from local authorities, thereby driving down prices and profits.
Only by identifying and addressing factors that deter new provision, can a better functioning market offering more appropriate places at reduced cost to local authorities be achieved, it concludes.
For Liverpool City Council, there is an acceptance among senior management that it must engage with the market to meet the level of demand for residential care placements.
“We’ll never have enough in-house provision to meet all our needs so we definitely will still have to buy from other providers,” says Carol Roche, the council’s commissioning manager for children and young people’s services. “But we should be asking what that market needs to look like. We know that profits are being made by the private sector and so we need to help stimulate the not-for-profit sector.”
She says the increased cost of care placements has been a driver for Liverpool to find new ways in which to fulfil its statutory duty towards children and young people requiring residential and foster care.
“It’s not that the quality is lacking necessarily but there’s an issue around market economics with providers charging the prices they want,” explains Roche. “Some of that could be around them not being able to fill each bed that we want because the children could be more complex. This would mean those costs are passed back to us.
“We have a shrinking foster care market which means there are a significant number of children in residential provision which is not their placement choice.”
To tackle these issues by increasing its in-house provision, Liverpool has partnered with Barnardo’s to open two new residential children’s homes in the city.
One setting has been open for just over a year and a second is due to open in early 2022.
Roche says the local authority has also secured capital funding to open two more children’s homes creating four new residential settings across the city.
Barnardo’s charity status means it is not commercially driven to generate a profit by providing children’s residential care, explains Roche. This – together with its expertise – means it enjoys greater scope to provide more bespoke and flexible options for children and young people requiring placements, she adds.
Despite some initial challenges over finding the right placement match for children, Roche says the arrangements are working well, providing stability for the children involved.
Nadine Good, Barnardo’s director of children’s services, North region, says young people were involved from the start in developing the new service.
This ranged from being included on staff interview panels to helping choose furniture and decoration for the new homes. Good says the move was intended to help children and young people feel as comfortable as possible with their new accommodation.
“The modern-day residential service offers specialised support and stability in a safe and nurturing environment, to help young people to heal, recover and move on from traumas and challenges they may have faced,” she says.
“As a charity, we provide support to the most vulnerable children and young people in our society and we are proud to be partnering with Liverpool to offer this bespoke and trauma-informed service, helping young people to rebuild their resilience and look to the future with hope,” adds Good.
She says the charity was keen to work with the local authority to help deliver high quality and “impactful care” and the development of new approaches that would support “wider system change”.
The four new homes will give Liverpool 15 extra beds, a figure Roche says will make a “huge difference” to its residential care provision. There are currently 131 children placed in residential care in the city, of which 101 are placed outside of the city and 75 outside of the Merseyside region. Despite this, latest benchmarking data shows that 12 per cent of all new placements in 2020/21 were in a setting more than 20 miles from home, compared with 17 per cent nationally and 13 per cent for the North West region.
Roche says these new beds could start to reduce the number of children sent outside of Liverpool due to insufficient care placements in the city.
This is being supported further by a local framework set up for the Liverpool City Region in conjunction with around 30 residential and foster care providers (see below).
The six local authorities involved aim to encourage a more relational approach which includes the appointment of relationship managers to work with these providers to ensure high-quality provision.
The group also wants placements in the region to be filled by looked-after children from the area rather than other authorities.
“That’s difficult when you’re operating in a wider market and we might get a good match for a child from another area,” explains Roche. “But we want to have Liverpool City region children in those beds. If we take those beds back one at a time, then we will have enough in the region for our children.”
She explains the relationship managers will play a key role in delivering an agreed placement stability policy allowing for support to be put in place early on to avoid placement breakdown.
“We encourage the providers to speak to their relationship manager as early as possible,” she says. “It could be anything from a bad Ofsted visit to financial issues, but we want them to talk to us so we can help them manage it.”
A further two beds will be created in Liverpool once a new NHS England-funded therapeutic unit for children with complex needs is built.
It will offer vulnerable young people intensive support over a longer time frame until an accurate diagnosis can be made, Roche adds.
It is another example of Liverpool trying to deliver the most appropriate services for children and young people in a timely way. Only by doing this can it start to see real cost savings follow.
Roche says: “If we get the services right, it will save us money and we’ll only be paying the right price for these placements which we can then benchmark.
“We know what staffing costs and salaries should look like and so we know what the price should be. We are hoping it will lead to more realistic pricing in the region.”
HOW WIRRAL IS TAKING THE LEAD IN REGIONAL APPROACH TO DEVELOPING RESIDENTIAL PLACEMENTS
A collaboration between Liverpool City Region (LCR) Combined Authority – which comprises the six local authorities of Halton, Knowsley, Liverpool, Sefton, St Helens and Wirral – and social business Capacity has seen the launch of Juno Community Interest Company (CIC) to deliver a new model of children’s residential care.
In Wirral, which is at the forefront of the scheme, the council recently considered a report requesting approval for a £1m investment by way of a commercial loan to Juno CIC to support the development of up to four new children’s homes in the area.
The committee was asked to recommend the loan on the basis it would ensure enough beds for looked-after children in Wirral amid rising numbers of children coming into care.
Across the LCR, the number of looked-after children has increased by 18 per cent since April 2016.
Figures published in October show, despite a rigorous programme to reduce numbers, Wirral had 820 children in care. With 11 per cent fewer independent foster carers than in 2016 and with in-house foster carers reducing across the region, the number of carers is failing to increase in line with rises in looked after children.
The proposal put to the council by Capacity outlined plans to create an ethical, sustainable network of residential care homes that would “significantly improve the life chances of children living in care”.
The plan was not to replicate existing children’s homes models but to develop a network of homes that deliver greater quality, with more comprehensive support to transform opportunities for children and young people.
Two-phased approach
A two-phased approach could see 10 homes established across the LCR with the first phase creating four homes of four beds with a further six set up in a second phase.
A timescale for phase one would see the homes open by March 2022 and from January to September 2023 for phase two.
Juno CIC, which was set up in November 2020, will act as the service delivery company and main hub for administrative support for the children’s homes as they become operational.
The £1m loan agreement, scheduled to run over a 12-year period, is expected to enable the placement of Wirral children in-borough at a fixed price for the next three years.
This would be at sub-market cost, creating a saving of around £200 per week per child placement.
Such a move would help Wirral to reduce the need for expensive out-of-borough placements as part of its medium-term financial strategy to reduce high-cost placements.
The local authority is forecasting savings of around £170,000 per year from 2024/25 once phase two is in operation, with a proportion of the savings being achieved from 2022/23.
