The government response to the Justice Select Committee's report Cutting crime: the case for justice reinvestment, said there is a "strong case" for exploring greater devolution of custodial budgets across the entire secure estate, but referred to it as a "complex process".
Devolving the cost of custody has risen to the top of the youth justice agenda after the Youth Justice Board (YJB) backed the idea.
YJB chair Frances Done has argued it would remove "perverse incentives" in the current system whereby the cost of prevention work is funded by local authorities while custody is not. She is now proposing a three-year trial involving one or two groups of local authorities.
The government response said a change to the current system would require initial investment to enable local authorities to bring down levels of custody prior to its introduction. It would also require greater engagement between local authorities and the courts.
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