Government trials foster-rate allowances for kinship carers in £126m pilot

The government has announced a £126 million pilot programme to test the introduction of financial allowances for kinship carers in England, in what ministers describe as the largest investment of its kind to date.

Under the scheme, kinship carers in seven selected local authority areas will receive a regular payment per child, equivalent to the fostering allowance. The trial will run for up to three and a half years and is expected to reach around 5,000 children.

Kinship carers – typically grandparents, aunts, uncles or family friends – step in to care for children whose parents are unable to do so full time. While foster carers receive a national minimum allowance, financial support for kinship carers has historically varied widely between councils.

The new “Kinship Zones” pilot will test whether providing a guaranteed allowance improves stability and outcomes for children, while also examining how wider local support for kinship families can be strengthened.

According to the Department for Education, the areas were chosen to reflect a mix of geography, demographics and service models, with the aim of testing delivery at scale in different contexts.

Announcing the scheme, Children and Families Minister Josh MacAlister said the trial recognised “the vital role” kinship carers play in keeping children within their family networks.

The move follows longstanding calls from campaigners and sector leaders for parity between foster and kinship carers. Although kinship care is often seen as helping children maintain family connections and avoid entering the formal care system, carers can face financial hardship when they take on the role, frequently at short notice.

Research from University College London in 2021 found that adults who had grown up in kinship care reported lower rates of long-term illness and higher employment rates compared with those who had experienced foster or residential care. However, the evidence base on the impact of direct financial support for kinship carers remains limited, which the pilot aims to address.

The programme will be evaluated by Foundations, working with Alma Economics, tracking outcomes for both carers and children. The Department for Education has said findings will be published to inform future decisions about national rollout.

Dr Jo Casebourne, chief executive of Foundations, said the evaluation would help “build the evidence base and shape future support”.

The government has confirmed funding for the first two years of the pilot, with further investment subject to the next Spending Review.

The announcement has been broadly welcomed by sector organisations, many of which have campaigned for a statutory allowance for kinship carers.

Jahnine Davis, the National Kinship Care Ambassador, described the pilot as an “important milestone” and said her accompanying report calls on local authorities to take a more holistic, “think family” approach.

Children’s Commissioner Rachel de Souza said she had previously called for financial support to ease transitions into kinship arrangements and welcomed the trial as a “first step”.

Cathy Ashley, chief executive of Family Rights Group, said many kinship carers experience financial hardship despite saving the state significant care costs. James Bury of CoramBAAF highlighted ongoing challenges for councils in providing consistent financial support.

Lucy Peake, chief executive of Kinship, said a guaranteed allowance equal to the fostering rate would be “life-changing” for families in pilot areas, but added that longer-term reform would be needed to address inequities nationwide.

The Department for Education has said any savings realised by councils as a result of central funding for allowances should be reinvested into broader family network support.

If the evaluation demonstrates improved outcomes and cost-effectiveness, the Kinship Zones model could inform a wider national policy shift towards routinely paying kinship carers on a comparable basis to foster carers.

For now, the sector will be watching closely to see whether the trial delivers on its ambition: enabling more children to remain safely within their family networks, while providing carers with more equitable and consistent support.