In a draft response to an ongoing government consultation
on the above-inflation increase to the Ofsted registration fee, the Independent Children's Homes Association (ICHA) urges the government to hold off on introducing the charge "for child-centred reasons".
The ICHA accused policymakers of a "disconnection from reality" in proposing the changes - the latest in a decade of annual increases.
It comes a year after the government overlooked the sector response to the consultation over 2018/19's registration fee, in which almost two thirds (62.5 per cent) of respondents were opposed.
Jonathan Stanley, chief executive of the ICHA, states in the association's draft response to the current consultation: "Anything that affects the wellbeing of the sector is of major concern. The government should be applying a steadying hand.
"For child-centred reasons no increase to fees should be made."
Stanley added: "Pressurising providers may well tip some into not continuing. By decreasing children's homes provision young people in desperate need may be directly affected."
"The disconnection of policymakers from the reality of providing care is an extremely worrying trend. Any raising costs could drive some providers out of existence," he continued.
"Last year nearly two thirds of respondents were not in favour of increasing fees by 10 per cent, yet the government ploughed on.
"Current experience is that it is futile to respond to government consultations as the conclusions are already made."
For 2019/20 the government is proposing to raise the provider registration of a small children's home, of three or fewer places, from £873 to £960.
Although no rise is proposed for the £2,646 fee for larger homes of four places or more, the government wants to increase the registration fees for managers at these homes from £873 to £910.
Social care fees for children's homes of up to 29 places are also set to rise, from £2,344 to £2,578.
Previously, providers have said they would pass on increased costs to councils, due to multiple budgetary pressures.
The government claimed the increases are needed as currently it is having to subsidise the cost of inspections for the majority of social care settings and wants to move towards full cost recovery.
"The majority of providers are a long way from paying the full cost of the inspection and regulatory activity undertaken by Ofsted," states the government's consultation document.
"A number of providers are paying less than 25 per cent of full cost recovery with the majority paying less than 50 per cent of full cost recovery."
The consultation opened on 7 January and closes on 18 February this year.