Costs and consequences of child care provision
Department for Education and Skills
Following concerns about spiralling costs of delivering effective services for children in need, this prospective longitudinal study explored the relationship between costs and outcomes for children looked after away from home.
The study led to the development of a practical computer application called the Cost Calculator for Children’s Services (CCfCS) to facilitate cost calculations. This calculates the cost of social care processes, taking into account the many variations according to placement type, the child’s characteristics and so forth.
The study aimed to assess how far variations in the cost of different types of provision are reflected in the quality of care experienced by children with different needs, and to devise robust methods that enable local authorities to calculate the cost consequences of different types of child care provision.
Quantitative and qualitative data concerning the background, needs and experiences of 478 children looked after by three matched pairs of local authorities were collected.
Data on children’s needs and experiences were collected from management information systems, case files and from structured interviews with children and young people and their carers.
The researchers identified and worked out unit costs of eight processes that support the case management of children looked after away from home: deciding a child needs to be looked after and finding the initial placement; care planning; maintaining the placement; exit from care; finding subsequent placements; review; legal process; transition to leaving care.
Specific data was gathered from focussed discussions at team meetings to ascertain the time taken to complete these activities.
- A number of factors impact on the cost of looking after children: organisation and procedures operating within the local authorities, the pattern and types of placements provided and the needs of children.
- Child related factors include: age, disability, emotional or behavioural difficulties, and offending behaviour. The circumstances of asylum seeking children were also found to produce different cost pathways.
- The children in this study fell into eleven groups categorised by single or multiple combinations of the above factors. The Cost Calculator includes sixteen possible needs groups, to allow for a greater number of different combinations of factors than was found in the original study.
- Children who displayed none of these additional characteristics cost substantially less to look after than those who displayed one of them; costs were found to be even higher for those children who displayed combinations of two or more characteristics. A very small number of children with exceptionally high needs could skew the costs of the looked after population in an authority.
- The study also identified substantial variation between the costs of different placement types. The standard unit cost for maintaining a child for a week in residential care was eight times that of the cost of foster care, 9.5 times that of a kinship placement and 12.5 times that of a placement with own parents.
- Furthermore, the findings indicated an inverse relationship between the costs of provision and the children’s opportunities for improving their life chances. Children who did not display any evidence of additional support needs cost the least to look after and were most likely to remain in stable placements and complete their statutory schooling. On the other hand children who displayed a combination of additional support needs had the most costly care episodes and were most likely to experience changes of placements and unscheduled school changes.
The findings from this study have important implications for improving outcomes for children’s services. Accurate costing of services could be linked to outcome data to facilitate comparisons of cost effectiveness.
Evidence from the study will inform the 'Choice Protects' initiative and consequently assist local authorities in improving their commissioning strategies.
CCFR Evidence Paper 7: Looked After Children: Counting the Costs. Loughborough: CCFR
Holmes, L. with Lawson, D. and Stone, J. (2004) Looking After Children: at what Cost? A Resource Pack. London: Choice Protects, Department for Education and Skills
Holmes, L. with Lawson, D. and Stone, J. (2005) Developing Unit Costs for Looked After Children – Resource Pack. London: Choice Protects, Department for Education and Skills
Ward, H., Holmes, L., Soper, J. and Olsen, R (2004) Costs and Consequences of Different Types of Child Care Provision. Loughborough: Centre for Child and Family Research
Ward, H., Holmes, L., Soper, J. and Olsen, R. (Forthcoming 2007) Outcomes for Looked After Children: Costs and Consequences of Placement Choice. London: Jessica Kingsley Publishers
Professor Harriet Ward, Lisa Holmes, and Jean Soper (CCFR) with Richard Olsen (University of Leicester).
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