Value for Money

Managing children’s residential care

Published 12 September 2025 8 recommendations Department for Education Childcare and children's services nao.org.uk
This report assesses DfE’s response to challenges faced by local authorities in placing looked-after children in residential care in England.

Recommendations (8)

Source: NAO Recommendations Tracker
Government Response Pending
The NAO has not yet recorded a response to these recommendations. NAO tracks whether departments are acting on its recommendations via its recommendations tracker. This report was published 12 September 2025.
Department for Education
Rec 1 Response Pending
To establish a productive and resilient residential market, DfE should provide clarity on its vision for the residential and foster care market so that local authorities, given their statutory and operational responsibilities, can consider these characteristics in determining local delivery models and planning.
Page 12, 22a
Department for Education
Rec 2 Response Pending
To establish a productive and resilient residential market, DfE should: within the context of potential legislative changes, work quickly to define and develop its role overseeing the operation and resilience of private residential and foster care providers. It should gather and use proportionate cost, profit, staffing and capacity information to set a strategic direction and better support local authorities
Page 12, 22b
Department for Education
Rec 3 Response Pending
To establish a productive and resilient residential market, DfE should: after piloting regional commissioning, produce a clear plan for how to overcome legislative, cultural and procedural challenges to rolling this out as soon as possible
Page 12, 22c
Department for Education
Rec 4 Response Pending
To establish a productive and resilient residential market, DfE should: building on learning from RCC pilots, establish regular information sharing between local authorities to better understand good practice and how to address any cost inconsistency for similar placements
Page 12, 22d
Department for Education
Rec 5 Response Pending
To address why looked-after children are not always placed in the most appropriate care, DfE should: agree with the Department of Health and Social Care and the Ministry of Justice a cross-government approach to ensure looked-after children with the most complex needs are provided the most appropriate setting and care. This should set out shared accountability for the system to work effectively; how the impact of policy decisions will be assessed; and how to make joint funding bids
Page 12, 23e
Department for Education
Rec 6 Response Pending
To address why looked-after children are not always placed in the most appropriate care, DfE should: using its assessments of foster care initiatives, including regional hubs and peer support, prioritise existing and new approaches that have the best potential to increase recruitment and retention of fostering households
Page 12, 23f
Department for Education
Rec 7 Response Pending
To address why looked-after children are not always placed in the most appropriate care, DfE should: building on its work to improve the skills of children?s care home workers, consider how it can bring together a package of interventions to support providers in having enough staff with the right skills. As part of this it should consider how it can learn from its approach to increasing early years sector staff
Page 12, 23g
Department for Education
Rec 8 Response Pending
To address why looked-after children are not always placed in the most appropriate care, DfE should: provide local authorities with further guidance and support so they can more effectively maintain homes and reduce the need for expensive repairs or new buildings.
Page 12, 23h