Written evidence submitted by Action for Children, Barnardo’s, The Children’s Society, the NSPCC and the National Children’s Bureau [SRF 021]

The UK’s leading children’s charities Action for Children, Barnardo’s, The Children’s Society, the NSPCC and the National Children’s Bureau have monitored trends in funding and spending for local authorities children’s services over several years; most recently in relation to the impact and effect of delivering these services to children, young people and families during lockdown as a result of the COVID-19 crisis. We are pleased to have the opportunity to share our evidence with the Housing Communities and Local Government Select Committee as part of the inquiry into the Spending Review and local government finance.

Summary

The COVID-19 pandemic has increased the pressure on families, reduced children’s access to support and made it harder than ever before to protect those at risk of harm. There needs to be increased funding for children’s services and an ambitious long-term plan to boost outcomes for children and young people, without which the on-going effects of the crisis will define a generation

 

 

 

 

 

 

 

1.    Financial challenges facing councils

 

1.1.  Our report, Under Pressure: Children’s and young people’s services 2010-11 to 2018-19, analysed the latest data on funding available for children’s services, and local authority spending. It found that, even before COVID-19, the children’s social care system was under immense strain. Over the last decade, demand for statutory children’s services has risen, but funding available for children’s services has plunged, with local authorities having £2.2 billion less available in 2018/19 than they did in 2010/11.[i] The financial stability of local authorities is being severely challenged as business rates, council tax and other revenue streams are diminished by the economic impact of the pandemic. The strain on these finances will be further intensified as, since the onset of COVID-19, children’s social care has become increasingly expensive. Overall, local authorities spent an additional £136 million on children’s social care between March and July due to COVID-19.[ii] Four in five local authorities reported a rise in weekly foster and residential placements costs due to coronavirus between April and August.[iii]

 

1.2.  Despite the £1.6 billion of emergency funding made available to local authorities during this crisis,[iv] this increasing pressure is forcing councils to make reductions to their support offers for children. In September, three local authorities announced multi-million pound cuts to children services spending,[v] which reverses the slight increases in spending that all three had instituted in 2017/18-2018/19.[vi]

 

1.3.  COVID-19 has led to increased pressures on families trying to cope with lockdown and social isolation, insecurity, or loss of employment and housing can increase the risk of child abuse and neglect.[vii] In the first (national) lockdown the vast majority of children were not attending schools for much of the period, and had less contact with professionals or other adults outside of the home.[viii] Their welfare has been much less visible, and concerns much more easily missed. Referrals to children’s social care services from 27th April to 19th July were between 10% to 30% lower when compared to the average in the same week across 2016 to 2018.[ix]

 

1.4.  Referrals began to increase between10th August to 16th August to reach a point 12% higher than the three-year average of the same week across 2016 to 2018.[x] Equally, the NSPCC helpline saw contacts increase by over 40% during April to July – up to 29,000 – with contacts about physical abuse increasing by more than 50%.[xi] Evidence from the NHS also showed fewer children using services, with more delays in seeking medical assistance, and a potential increase in babies with non-accidental injuries.[xii]

 

1.5.  The pandemic has seen the lowest earners suffer a disproportionately large hit to their finances,[xiii] and BAME communities have been disproportionately impacted by both the physical and economic harm of the crisis. On top of this, local authorities with the most deprived communities have suffered the greatest reductions in spending power over the last decade and are therefore facing an even steeper gradient of heightened need and reduced capacity.[xiv]

 

1.6.  If need does increase, and the capacity of children’s services to respond does not expand to meet that demand, we are likely to see an acceleration in the trend towards late intervention spending, and loss of investment in early intervention services, that was already clear before COVID-19.

 

2.    The current financial situation of councils, and their ability to deliver services and the demand for services

 

2.1.  Our analysis has found that, even as estimated funding available for local authority children and young people’s services fell by 23% between 2010/11 and 2018/19, spending fell at a considerably lower rate, decreasing by only 6%, or £536 million.[xv]

 

2.2.  This situation has left many local authorities in England operating from a deeply insecure financial position. Approximately 91% of local authorities overspent on children’s social care in 2017-18 by £872 million[xvi], with local authorities faced with little choice but to draw down on their reserves or pull resources from other services.

 

2.3.  It has been reported that limited resources are one of the main challenges facing services trying to keep children safe, [xvii] and that increasing child poverty and decreasing resources are placing the system under increasing and unsustainable strain.[xviii]

 

2.4.  During the judicial review of The Adoption and Children (Coronavirus) (Amendment) Regulations 2020, this strain and its impact were summarised, noting the children’s social care system “was already facing significant pressures prior to COVID-19”. As Mrs Justice Lieven DBE summarised, “these pressures manifest themselves in the fact that as at March 2020 only 50% of local authorities were judged good or outstanding by Ofsted with 21 local authorities judged inadequate. There is a vacancy rate nationally amongst social workers of 16.4% with much higher rates in some local authorities. The problems within the children social care sector are longstanding and extremely well documented, not least in judgments from the Family Division of the High Court.”[xix]

 

2.5.  Local authorities are legally obliged to ensure that statutory services are delivered and funded. Cuts to funding, in combination with rising demand, has meant that there is less money available for investment in non-statutory ‘early intervention’ services which enable professionals to step in before problems escalate. Local authority spending on early intervention services for children and young people fell from £3.5 billion to £1.9 billion between 2010/11 and 2018/19 – a 46% decrease.

 

2.6.  Local authorities have been forced to allocate ever greater proportions of their spending to statutory areas such as safeguarding and children in care. Spending on late intervention services for children and young people rose from £5.6 billion to £7.2 billion between 2010/11 and 2018/19 – a 29% increase.

 

2.7.  With 22% more children becoming subject to child protection plans in 2018/19 than in 2010/11, spending per head for looked after children rose by £10,000 per child to £61,805 an increase of 19%. Of note, in 2019, not only was budgeted spend per person on acute children’s social care 2% higher than in 2009/10, but that councils had overspent relative to those budgets by 8% on average over the last four years.[xx]

 

2.8.  Evidence shows this system is not delivering for children, highlighting the low educational outcomes attained for children who have been in contact with the social care system. They are less likely to achieve a strong pass in core subjects, less likely to attend higher education[xxi] and are massively overrepresented in both the youth and adult justice systems.[xxii]

 

2.9.  Research interviews with staff making decisions about services for children in three different local authorities in England showed, despite their differing situations, all three were facing financial constraints. They were all seeing an increase in demand for children’s services, all were overspending and drawing from other budgets and reserves to bridge funding shortfalls, and all felt that they had long since reached the limits of innovation. [xxiii]

 

2.10.  Participants highlighted there had been reductions to early years services and to targeted support for those whose needs had not reached a critical stage. Cutting non-statutory services was viewed as a comparatively “quick win”. However, there was universal understanding that stripping back early intervention services would cause difficulties in the future, as participants connected a lack of preventative work with an upsurge in the number of children taken into care. One told us: “we are saying early help is most important in the lives of these children and young people. And that juxtaposition of having to say this is really important but this is where we’re going to take the money from, I think, is the real challenge of where we’re at in this point in time.”

 

2.11.  Many participants worried about the quality of service being provided to looked after children. Participants believed limited numbers and availability of residential care and fostering placements was driving up costs, as some authorities felt they had no choice but to commission very expensive placements from independent agencies. The cost of delivery, and kind of support that can be made available to children, needs to be revisited to prevent an ever-increasing share of the available pot being spent on a small number of the most vulnerable young people.

 

3.    Financial challenges facing councils as a result of the COVID-19 pandemic

3.1.  Our analysis suggests areas with the highest levels of deprivation have experienced a higher proportion of cuts to children’s services funding, and may have an impact on children’s outcomes and the knock-on effect on the desire by the Government to “level up and invest in people and places”.[xxiv]

3.2.  Our Under Pressure[xxv] report found that since 2010/11, the most deprived local authorities have seen more than twice the size of cut to funding available as the least deprived areas. Unsurprisingly, spending in the most deprived areas has dropped by 14%, whilst spending in the least deprived has increased by 9%[xxvi]. Where local authorities have had to cut spending this has often been to early intervention services such as children’s centres – which are of particular benefit to those in deprived areas. It is likely also to have a particular impact on children from certain ethnic minority backgrounds – 46% of children who are from a black or ethnic minority background were in poverty, compared to only 26% of white British children.[xxvii]

3.3.  We have tracked the strength of the relationship between cuts to local authority funding and a range of other socio-economic factors by using the correlation coefficient - a number between 1 and -1.  Here we looked at those local authorities that had the lowest levels of funding compared to their funding levels in 2010 and compared them against the rate of various socio-economic problems in the area. 

3.4.  Our analysis found a strong negative correlation between those local authorities with the lowest percentage of funding compared to their 2010 level and:

3.5.  Those with the highest level multiple deprivation average scores[xxviii]this correlation coefficient is calculated at (-0.82), as demonstrated in the following graph:

3.6.  Those with the highest level of free school meal eligibility[xxix] this correlation coefficient is calculated at (-0.82), as demonstrated in the following graph:

 

3.7.  Those who have the highest rate of children living in households where there is domestic abuse[xxx]this correlation coefficient was calculated at (-0.75), as demonstrated in the following graph:

3.8.  Those with the highest rate of children living in households where a parent has mental health or well-being issues[xxxi]this correlation coefficient was calculated at (-0.87), as demonstrated in the following graph:

3.9.  Those that have the highest levels of unemployment[xxxii] this correlation coefficient was calculated at (-0.63), as demonstrated in the following graph:

 

3.10.   The reason behind these relationships is most likely due to changes in how local authorities receive funding since 2010. Reforms to how central government calculated grant allocations, conducted in 2013, resulted in all local authorities receiving the same percentage cut to core grants. However, deprived local authorities were more reliant on central government grants to fund local services, and the uniform cut did not take into account the levels of deprivation in a council area – or the associated level of demand for services[xxxiii]. The income of more deprived local authorities has therefore taken an outsized hit as they are more likely to have lower council tax and business rates, and their funding has continued to disproportionately decrease in the years since. 

3.11.   Given we know that children’s social services in areas with high levels of socio-economic problems are likely to need to respond to higher than average levels of needs, the trends are concerning. If measures are not put in place to address this disparity, and the further economic fallout as a result of the COVID-19 pandemic, there is a significant risk that local authorities facing the greatest demand for support from families locally will be in the weakest position to provide this, especially so if the current trend of regional tiered restrictions and national lockdowns continues, as seems likely, for some time.

4.    Cuts to children’s services, deprivation, and the possible impact of the COVID-19 pandemic

4.1.  Many areas, particularly in the north of England, have already experienced long-lasting stricter rules on socialising, followed by the Government’s tiered approach, culminating in a 4-week national lockdown. The repetition of cycles of restrictions are likely to put a significant strain on families. All of these have the potential to have a knock-on impact on children’s social services departments who may find an increasing number of their families requiring extra help and support to manage.

4.2.  To examine the indication of the possible correlations between areas likely to be subjected to ongoing restrictions, deprivation, and children’s services funding, we conducted a short analysis looking at the situation. Our findings for this analysis are outlined in Table 1 below. This indicates that of the ten areas with the highest COVID-19 infection rates as of 8 September 2020:

 

4.3.  We already know that deprivation, domestic abuse and free school meals are correlated with high levels of funding cuts. There is a risk of a “perfect storm” in children’ services funding as those areas facing significant additional demand as a result of the stress of extra COVID-19 restrictions are also those where high levels of deprivation are also putting an additional demand on their services.

4.4.  If these areas are to be levelled up, funding must take into account the presence of deprivation within local authorities as both connected to socio-economic factors which drive demand for children’s services and having a relationship to the potential impact of the pandemic.

Table 1: Potential correlations between local authority areas likely to be subjected to ongoing restrictions, deprivation, and children’s services funding

Local Authority

Cumulative Count of Infections (8/09/2020)

Deprivation (1 most deprived to 5 least deprived)

Percentage of Children Eligible for Free School Meals (1 highest proportion-5 lower proportion

Birmingham

7,495

1

1

Bradford

6,762

1

2

Leicester

5,953

1

2

Leeds

5,090

2

2

Sheffield

4,919

2

1

Manchester

4,726

1

1

Durham

3,709

2

1

Liverpool

3,158

1

1

Oldham

3,105

1

2

Bolton

2,841

1

2

Sources: Cumulative count of infections (LGA); Deprivation: Ministry of Housing, Communities & Local Governments

4.5.     Delivering high quality children’s services, and effective interventions to families, locally requires long-term planning, and time is needed to establish services within communities and build important relationships. Many early intervention services, such as children’s centres and family hubs, work by embedding themselves within communities and building effective partnerships with other local services, ensuring joined up work which addresses family’s needs in a holistic way.

4.6.  It is not possible to deliver this type of effective intervention without the assurance of longer-term funding. Local authorities who do not know if they will have the funding settlement they need to deliver these services will be forced to take a short-term approach, and will not be able to have the confidence to invest in the buildings or other infrastructure necessary to deliver effective services. Charities are already being asked to commit to shorter-term contracts which, at worst, can result in fewer effective interventions being able to be offered or, for initiatives such as the Troubled Families Programme, impair their ability to achieve their full potential. For example, we know in the autumn of 2019 it was increasingly difficult for some families of adopted children to access interventions of longer than six months since there was no certainly at the time whether the Adoption Support Fund would continue beyond March 2020.

4.7.  While the government’s recent approach to only commit to short-term funding plans is understandable, given the pandemic, it is an unsustainable solution longer term. 

 

 

5.    Recommendations

5.1.  Without significant investment local authority children’s services, who play a central role in supporting children and families, identifying needs and providing additional support when needed, will find increasingly this may not be possible. The risk of increasing thresholds, numbers of children in care and increasing placement costs will continue, further impacting the ability for children’s services to respond to the COVID-19 crisis (and help recovery) as needed.

5.2.  The sector made three main asks of the Government for the CSR:

Increase funding for local authority children’s services to boost the outcomes of vulnerable children while delivering long-term sustainability to the system

 

 

 

 

November 2020

 


[i]Endnotes:

 

https://www.barnardos.org.uk/sites/default/files/2020-05/Summay%20of%20the%20analysis%20and%20deep%20dive%20reports%20-%20May%202020.pdf

[ii] https://www.gov.uk/government/publications/local-authority-covid-19-financial-impact-monitoring-information

[iii]https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/918185/VCYP_Survey_publication_W8_Final.pdf

[iv] https://www.gov.uk/government/publications/covid-19-emergency-funding-for-local-government

[v] Oxfordshire: https://mycouncil.oxfordshire.gov.uk/documents/s52576/CA_AUG1820%20Annex%202.pdf; Luton: https://engage.luton.gov.uk/childrens-services/ifrs-consultation/; Croydon: https://www.croydon.gov.uk/democracy/budgets/the-council-budget

[vi] https://www.gov.uk/guidance/section-251-2017-to-2018; https://www.gov.uk/guidance/section-251-2018-to-2019

[vii] https://learning.nspcc.org.uk/media/2246/isolated-and-struggling-social-isolation-risk-child-maltreatment-lockdown-and-beyond.pdf

[viii] https://explore-education-statistics.service.gov.uk/find-statistics/attendance-in-education-and-early-years-settings-during-the-coronavirus-covid-19-outbreak

[ix]https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/918185/VCYP_Survey_publication_W8_Final.pdf

[x]https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/918185/VCYP_Survey_publication_W8_Final.pdf

[xi] NSPCC (2020b). Internal NSPCC helpline and Childline statistics

[xii] Royal College of Paediatrics and Child Health (RCPCH) (2020) Impact of COVID-19 on child health services tool: results. [Accessed 27/07/2020]; Sidpra J. et al. (2020) Rise in the incidence of abusive head trauma during the COVID-19 pandemic. Archives of Disease in Childhood, Published Online First: 2 July 2020.

[xiii] https://www.iser.essex.ac.uk/files/news/2020/single-mother-income-loss-covid-19/covid-briefing-paper-economic-effects.pdf

[xiv] https://www.childrenssociety.org.uk/sites/default/files/childrens-and-young-peoples-services-funding-and-spending-report-2018-19_1.pdf

[xv] https://www.childrenssociety.org.uk/sites/default/files/childrens-and-young-peoples-services-funding-and-spending-report-2018-19_1.pdf

[xvi] https://www.nao.org.uk/wp-content/uploads/2019/01/Pressures-on-Childrens-Social-Care.pdf

[xvii]https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/869586/TRIENNIAL_SCR_REPORT_2014_to_2017.pdf

[xviii] https://www.frg.org.uk/images/Care_Crisis/CCR-FINAL.pdf

[xix] https://article39.org.uk/wp-content/uploads/2020/08/Article-39-Approved-Judgment.pdf

[xx] The Institute for Fiscal Studies, English local government funding: trends and challenges in 2019 and beyond https://www.ifs.org.uk/publications/14563

[xxi]https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/762826/Children_in_Need_of_help_and_protection-Interim_findings.pdf

[xxii] https://www.smf.co.uk/wp-content/uploads/2018/08/Silent-Crisis-PDF.pdf

[xxiii] https://www.childrenssociety.org.uk/sites/default/files/pressures-on-childrens-and-young-peoples-services-a-deep-dive.pdf

[xxiv] https://www.gov.uk/government/news/chancellor-launches-comprehensive-spending-review

[xxv] https://www.childrenssociety.org.uk/sites/default/files/under-pressure-a-summary-may-2020.pdf

[xxvi]https://www.childrenssociety.org.uk/sites/default/files/childrens-and-young-peoples-services-funding-and-spending-report-2018-19_1.pdf

[xxvii]  https://www.gov.uk/government/statistics/households-below-average-income-199495-to-201819

[xxviii] Ministry of Housing, Communities & Local Governments ‘The English Indicators of Deprivation 2019’.

[xxix]Source: Children’s Commissioner Local Map Data

[xxx] Source: Children’s Commissioner Local Map Data - This is the modelled prevalence of the rate per 1000 CYP living in households with domestic abuse

[xxxi]Source: Children’s Commissioner Local Map Data Source: Children’s Commissioner Local Map Data - This is the modelled prevalence of the rate per 1000 CYP living in households with mental health issues

[xxxii] Source: NOMIS

[xxxiii] The Institute for Fiscal Studies (2015) The most deprived councils are likely to continue facing the sharp end of local government spending cuts [online] Available at: https://www.ifs.org.uk/publications/7732.