Local authorities might soon be able to draw on the support of regional bodies to help them find suitable placements for children, the Department for Education (DfE) says.

The Competition and Markets Authority (CMA) launched a market study into children’s social care in March 2021 due to concerns over a lack of availability of placements and high prices.

Its final report, published in March 2022, found there is a shortage of appropriate places in children’s homes and with foster carers. It also found that some children are being placed far away from their hometown or separated from their siblings.

The report warned that this shortage of places has driven up prices, meaning local authorities – who are responsible for placing children in an appropriate home – are paying higher costs.

The CMA also found that private sector investors appear to be making higher profits in England and Wales than would be expected in ‘a well-functioning and competitive market’.

In response to the report, the DfE yesterday committed to accept all of the CMA’s recommendations, including developing regional bodies to support local authorities in obtaining suitable placements for children.

These regional bodies would be able to engage better with placement providers, such as care homes and foster agencies, to help make sure the right placements are available when and where children need them.

Sarah Cardell, chief executive at the CMA, said: ‘This is a much-needed first step to improving the lives of vulnerable children and young people who rely on these services. Our recommendations, all of which have been accepted by the Department for Education, will help build a better and more supportive system.

‘We’ll continue to work with the Government to make sure these proposals deliver longstanding improvements, providing every child in care with the right home.’