Council Spending on Children in Care Rises to £9.5 Billion as Financial Pressures Mount

The figures, released on 8 October 2026, show the growing financial pressures facing authorities responsible for looking after vulnerable children and young people.

The association says rising costs are creating significant problems for council budgets and has renewed calls for changes to the children's social care system.

How much has spending increased?

According to the analysis, English principal councils spent approximately £6.6 billion on support for children in care during 2022/23.

By 2025/26, spending had increased to approximately £9.5 billion.

That represents a cash increase of around 44.5% over three years, equivalent to an average increase of approximately £1 billion a year.

Even after adjusting for inflation, spending increased by 29.1%.

The figures are based on local authority revenue expenditure statistics published by the Ministry of Housing, Communities and Local Government.

Councils spending more than budgeted

The financial pressure is also reflected in differences between council budgets and actual expenditure.

The analysis found that councils collectively overspent on children in care by approximately £3.2 billion across the 2023/24, 2024/25 and 2025/26 financial years.

In 2025/26 alone, authorities budgeted approximately £8.47 billion but recorded actual spending of £9.52 billion.

This produced an in-year overspend of approximately £1.05 billion.

Repeated overspending can make it difficult for councils to plan future budgets and maintain other local services.

Why are costs rising?

The Local Government Association has highlighted the shortage of suitable placements and wider problems within the children's social care market.

Councils have legal responsibilities to safeguard children who cannot safely remain in their family homes.

Those responsibilities must be met even when the cost of accommodation or specialist support increases.

The association argues that reforms to the care-placement market are needed to improve sustainability and ensure public funding supports high-quality care.

It has also called for greater investment in early intervention and preventative services.

What does this mean for taxpayers?

Children's social care is an essential statutory responsibility, and councils cannot simply withdraw support because budgets are under pressure.

The challenge is ensuring children receive appropriate and safe care while public expenditure remains transparent and financially sustainable.

The figures do not establish that the increased spending is unnecessary or improper. They demonstrate the scale of the financial challenge.

Important questions remain about placement costs, the availability of suitable services and whether the government's proposed reforms can reduce financial pressures.

Keep Updated UK will examine how local authorities are responding to rising children's social care costs and how spending compares across different council areas.