Richmond Council's children's services are facing a projected overspend of £1.4 million, primarily driven by the rising costs of placing children in care. This financial pressure is contributing to a projected £1.439 million overspend on the General Fund revenue services for the committee, as detailed in the Revised Education Children Services Qtr3 Monitoring Report.

The Education and Children's Services Committee heard that while the number of children requiring support has not increased, the complexity of their needs has led to a greater reliance on more expensive placement types. Social care professionals continue to report a step up in the complexity of need, which is driving up the average cost of support. Four children are currently in placements costing over £10,000 per week, a significant increase from two such cases in March 2025.

The average cost of a children's home placement has risen to £6,118 per week, compared to a budgeted £4,854 per week. The Q3 Quarterly Budget Monitoring Report indicates that high needs education, staffing, and social care placement budgets remain the key financial risks to the Council's children's services. The Directorate Budget Report 2026/27 also highlights that these budgets are influenced by high inflation, rising needs, and market shortfalls.

Richmond is not alone in this position, with over 80% of London boroughs reporting deficits that are growing. This indicates that Richmond's financial challenges with children's services are a widespread issue among London boroughs.

Council officers are actively reviewing high-cost placements to ensure children can move to more affordable options when appropriate, and the brokerage team is working to negotiate fees with providers. The leadership team is regularly reviewing all high-cost placements to ensure that children step down to more affordable placements as soon as they are ready and when placements become available. However, the report acknowledges that the market for specialist placements is facing shortages, contributing to increased costs.

A significant amount of work is underway to transform social care and early help services. This includes reviewing social care and early help delivery models, reviewing staffing models, and looking at how to increase the amount of affordable placements locally. Planned savings are also being outlined, focusing on reviews of preventative care models, social care staffing, and the digitisation of administrative functions. The SEND Futures Plan also outlines workstreams focused on Early Identification and intervention and Local Offer , which could be considered alternative models of support to mitigate rising costs in the future.