My Lords, I rise to speak to Amendments 16 and 17 in my name and that of my noble friend Lord McKenzie of Luton and to support the other amendments in this group. I fully support the case on kinship care set out so carefully by the right reverend Prelate the Bishop of Portsmouth. There are some common arguments that apply to adoption and kinship care, the two subjects in this group, and reasons that the Government should think very carefully before deciding not to provide tax credits and universal credit to third and subsequent children in those settings.
First and most obviously, we should not be putting financial barriers in the way of families willing to take on what are often very vulnerable children. As the right reverend Prelate has pointed out, if such families are deterred, the state is likely to find that the costs go
up, albeit not to the Department of Work and Pensions, but I hope the Minister would not be so parochial as to allow that in any way to influence him.
The average child tax credit claimed for a family of three or more children is £3,670, but, as the right reverend Prelate has pointed out, the NAO found in 2014 that it cost £40,000 a year to foster a child, aside from the one-off costs. How can that make sense? In many cases, had those children been able to stay with their birth families, tax credits would have been payable for them anyway, so it is not as though the cost is increasing. As we have heard, there is clear evidence that children in kinship care settings do better than those in unrelated care, despite having similar adverse circumstances.
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As we have also heard, kinship carers will be affected in a range of other ways, which we may come on to later in the Bill, but I, too, have had some examples given to me which were very moving. As well as grandparent care of the kind described by the right reverend Prelate, there are cases of sibling care. In a case brought to my attention of a lone parent who died of cancer leaving three children, the eldest of those children was over 18. So, supported by a charity and planned jointly with the mother, it was arranged for her to become the responsible carer of the two younger siblings when the mother died.
As an example of relative care, when another lone parent died leaving three children—all under 12—they were taken in by the lone parent’s sister and husband, who already had two children of their own. Both parents were in low-paid work but felt that offering a permanent home to these three children was the right thing to do. Without child tax credits, kinship care simply would not be an option for such families. They could not afford to maintain the children. Even with the support that they were getting, the reason that I came to know about them was that they applied to the charity Family Action for a grant to provide school uniforms and bunk beds for the three extra children who they were taking on, because they simply could not afford to pay for them otherwise.
There are also a number of other private fostering arrangements where friends or other relatives provide what may be shorter-term care—for example, when somebody may be hospitalised for a mental health issue or for cancer treatment. Private fostering arrangements can be registered where that is felt by the social workers or carers to be in the interests of the child. A social worker may sometimes seek an interim placement to avoid taking a child into care temporarily. If the Minister is willing to indicate at the end that he will look further at kinship care, will he look at the small group of private fostering arrangements along with that?
Amendments 16 and 17, which are in my name, would exempt children who enter a household as a result of adoption. It is government policy to increase the number of children who are adopted. Ministers have spoken much about this—they have already devoted £150 million to the adoption reform grant—but this policy will directly undermine that policy objective. Adoption provides huge savings to the public purse
because the family takes on responsibility for the children as though they were their own biological children. It also has demonstrably better outcomes for children. There are very small numbers of children affected in these cases, and any savings for the DWP will be dwarfed by costs elsewhere in the system.
I have been trying to get a sense of the scale. In March 2015, there were 69,540 looked-after children—virtually 70,000. Only 5,330 of those children were adopted from care during that year and 1,930 of those, which is 36%, were part of a sibling group. I do not know how many of those sibling groups consisted of at least three children but it means that, in this relatively small group, this is potentially a significant issue. Adoptive parents often have children of their own, in addition to the children whom they adopt, and there will be a clear financial disincentive if adopting would take them over the two-child limit. I am also very concerned that there will be a disincentive to adopt sibling groups if the two-child limit applies. Adopters are often specifically asked to take on sibling groups together, but if there are three or more siblings or children already in the household, that will be too much to ask of them. One of the consequences is that children will stay in foster care for longer, waiting for an adoption placement at £40,000 per annum but also making it harder for them to be adopted.
I have one brief case study. I spoke last week to a delightful woman called Ruth, who gave me permission to tell her story. She and her husband adopted three children who were siblings. She spoke movingly about the wonderful family that she had but said that it had not been easy, either emotionally or financially. She gave up work when the children were placed with her for quite a time because, overnight, she and her husband suddenly had three children under four who had significant attachment issues and needed her undivided attention. Part of the decision to place the children with her was the fact that she would give up work in the early years to look after them. Her husband is a vicar, however, so money was tight. She told me that tax credits made all the difference to her ability to take on those children and care for them. As she put it, “Tax credits helped us hugely. It is not like growing into a family of three kids. Expenses increase immediately”. Of course they do, when there is no handing down of clothes or toys, or buggies or beds, and no time to save up as the family grows. Suddenly, overnight, you are a family. She also described some of the hidden costs of adopting because of the extra pressure on families where there are children who have significant attachment issues. Families end up spending quite a bit of money on extra tuition and other external support.
There is already a shortage of parents willing to adopt sibling groups. Social workers struggle to find placements for three—and, occasionally, four or five—siblings so they stay in the care system for longer. Of course, the longer they stay in care, the harder it gets to place them because, unfortunately, it is harder to place older children. This costs vastly more than adoption but also damages the children, and the only alternative is to break up sibling groups, which is also very damaging to the children. Ruth spoke very movingly
of how the sibling bond can often be the only stabilising factor in a group of children who have otherwise lost everything.
Kinship care and private fostering and adoption provide huge savings to the public purse and better outcomes for children. Relatively small numbers are affected and any money saved here will be offset by higher costs elsewhere in the system. Can the Minister tell the Committee what attempts the department has made to assess whether the effect of this Bill will be to deter families with children from adopting more children? What assessment has the department made of whether it is likely that sibling groups will be less likely to be adopted as a result? Has the Minister discussed the impact of this change with his DfE colleagues? Finally, what assessment has he made of whether costs will increase elsewhere in government? I hope the Minister has some information for us because, if he was simply to say that no attempt has been made to consider those impacts, that would obviously be irresponsible. I know he is not an irresponsible Minister, so I look forward to hearing his reply.