The independent probe, established by the Prison Reform Trust, is to be chaired by Lord Laming, who previously chaired inquiries into the death of Victoria Climbié and the serial killer Harold Shipman.
The campaigning charity says that children aged between 10 and 17 who are in care are more than five times as likely to be in trouble than those who are not.
Lord Laming said: “It is a huge step for the state to assume the parenting of a child or young person. With that comes the responsibility to provide stability, security and hope for the future.
“We cannot stand by and allow wasted opportunities to result in wasted later lives.
“We are determined to ensure this review makes practical recommendations to enable key services to work together to help children in care transform their life chances and stay out of trouble.”
Members of the 21-strong review panel include Natasha Finlayson, chief executive at The Who Cares? Trust, Juliet Lyon, director of the Prison Reform Trust, and David Simmonds, chair of the Local Government Association’s children and young person’s board.
Representation from the criminal justice system includes Youth Justice Board (YJB) chair Lord McNally and Michael Spurr, chief executive of the National Offender Management Service.
In addition, a consultation group of children and young people with experience of both care and the youth justice system has been set up to advise the review team.
Other priorities for the review will be to gather accurate, up-to-date figures of the number of children in custody who have been or are in care, as well as the latest research on the links between crime and care.
It will also search out case studies of effective schemes at preventing children in care entering the youth justice system in England and Wales and globally.
Recommendations will be made for central and local government as well as inspection bodies when the review team reports early next year.
The first of its six weekly meetings takes place this week (25 June) and the review is appealing for professionals, families and young people with experience of the care and youth justice systems to give evidence.
Juliet Lyon, Director of the Prison Reform Trust, said: “There is a depressing route from care to custody which can, and must, be stopped.
“We need to listen to children in care about how they got drawn into trouble and hear their views on ways to get out of it.”
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