Call for ban on 'golden hellos' in fostering

The Local Government Association has warned that the practice is raising the cost of fostering services, and reducing the amount of money available to help vulnerable children.

It said that while independent fostering agencies, which include commercial, not-for-profit and charity organisations, are "a valuable part of the fostering system", a minority of agencies have been offering local authority foster carers thousands of pounds to switch to their agency.

As a consequence, councils that have trained foster carers at the taxpayer's expense can then be charged double or more to buy their services back from an agency if they are unable to meet demand with in-house provision, resulting in higher costs to the authority for exactly the same service.

In his independent review of children's residential care, government adviser Sir Martin Narey recently highlighted that eight commercial fostering agencies made £41m in profits in 2014/15.

The LGA said the money would be better invested in improved services for children and young people in need.

Richard Watts, chair of the LGA's children and young people board, said: "Councils are looking after more and more vulnerable children and young people, and independent fostering agencies provide a valuable service in making sure we have a wide range of foster carers available to meet the needs of different children.