ALG Elected Officers, 20 July 2006
Item no: 12 / Asylum seeking children
Page1 of 4
ALG Elected Officers, 20 July 2006
Item no: 12 / Asylum seeking children
Page1 of 4
ALG Elected Officers
Asylum seeking children / Item no: / 12
Report by: / Helen Johnston / Job title: / Head of Children's Services
Date: / 20 July 2006
Contact Officer: / Helen Johnston
Telephone: / Email:
Summary / This report updates Elected Officers on ALG’s work to secure adequate resources for local authorities for supporting:
  • unaccompanied asylum seeker children (Home Office)
  • young asylum seekers under the Children (Leaving Care) Act (Department for Education and Skills)

Recommendations / Elected Officers are recommended to note the report.

Background

  1. Funding for asylum seeking children and young people is spread across two main funding streams:
  • unaccompanied asylum seeker children (Home Office)
  • young asylum seekers under the Children (Leaving Care) Act (DfES)
  1. In addition, a small number of authorities have negotiated welfare benefits, including housing benefit and income support, for young asylum seekers leaving care.

Home Office funding

  1. Local authorities apply to the Home Office for funding to meet the costs of supporting asylum seekers with accommodation and social support. Grants are calculated on the basis of maximum weekly rates for unaccompanied asylum seeking children (UASC), single adults and families. The grant awarded may not meet the costs incurred by a local authority and authorities may then apply for an additional ‘special circumstances’ grant to meet some, or all, of this funding gap.
  2. In 2004/05, to address funding shortfalls experienced by some local authorities, the ALG and LGA produced a joint submission to Ministers to evidence the costs of supporting asylum seekers. Tony McNulty MP, the Home Office Minister responsible, considered the results of the survey and confirmed that special circumstances claims would be paid in full, subject to audits.

Department for Education and Skills funding

  1. The Hillingdon Judgment ruled that local authorities owe a duty of care under the Children (Leaving Care) Act 2000 to young asylum seekers and refugees aged 18 to 21 years (24 years if a person has special needs and continues in education) that were previously supported by social services.
  2. Since 2004/05, local authorities have been able to apply to the DfES for funding towards the costs of supporting young asylum seekers leaving care. In 2004/05 DfES made available £12 million to meet the costs of authorities most affected by the Hillingdon Judgment, with a further £5m contingency fund. A survey of costs was used to inform allocations but this did not meet the Government’s principle that requires departments to provide full funding for the cost of new burdens. For 2004/05, local authorities were expected to bear the costs of up to 44 young asylum seekers themselves. Grants were only available to authorities supporting more than 44 young asylum seekers at a flat rate of £140 per person per week.
  3. For 2005/06, the amount available was reduced to £11 million with authorities expected to bear the costs of up to 25 young asylum seekers themselves. Grants are available for authorities supporting more than the threshold of 25 asylum seekers at a flat rate of £100 per week but the total amount of grant available nationally must not exceed £11 million.
  4. In January 2006, the ALG and LGA agreed to conduct a joint survey of costs for supporting young asylum seekers supported under the Children (Leaving Care) Act 2000. A subsequent submission was made to Maria Eagle MP on 4 May 2006, and a meeting has been agreed by Parmjit Dhanda MP, the new DfES Minister responsible for asylum seeking children.

Issues

Home Office funding

  1. The ALG and LGA are currently negotiating with the Home Office to finalise special circumstances claims for 2005/06. The Associations have supported officials by checking claims and ensuring any significant increases can be justified by local authorities. In settling claims last year, Tony McNulty MP stated that funding for 2005/06 must not exceed the amount awarded in 2004/05.
  2. Bids for 2005/06 look to exceed the 2004/05 limits imposed last year. ALG and LGA are working with officials to identify where the increases have occurred and ensure bids are robust. Increases are concentrated in a small number of authorities including Hillingdon, which is a gateway authority effected by the presence of Heathrow, and Solihull, where a new assessment centre has been located to assess asylum claims for the Midlands.ALG and LGA are making the case for full funding.

DfES funding

  1. The ALG and LGA survey of costs for supporting young asylum seekers leaving care included all 33 London authorities and 12 local authorities outside of London. The survey showed that in 2004/05 there was a shortfall in funding of £15.3 million in London.
  2. In 2005/06, the authorities included in the survey forecast a total expenditure of £40.3 million. Using the allocation formula of £100 per week for each full year equivalent person above the first 25 supported, £15.8 million will be required from DfES, giving a shortfall of £24.5 million. However if the DfES uses current guidance and caps funding at a maximum of £11 million nationally, there will be a total shortfall of £29.3 million for those surveyed.
  3. Total spend is expected to increase to nearly £50 million in 2006/07 for those authorities surveyed.
  4. The survey of costs for supporting asylum seekers leaving care shows variations in unit costs between authorities. Data was presented by Area Cost Adjustment grouping to minimise local cost effects, with the three gateway authorities (Croydon, Kent and Hillingdon) grouped separately. There are a number of robust reasons for variations in unit costs:
  5. A small number of authorities have negotiated welfare benefits, including housing benefit and income support, for young people leaving care. Housing benefit requires agreement from the accommodation provider and income benefits are only available to those asylum seekers not in full time education and in possession of a National Insurance number.
  6. Accommodation costs vary more than any other cost factor. Some authorities have been able to negotiate low cost contracts with providers where there is a significant amount of accommodation available and where low levels of support of young people may be required; other young people are vulnerable and higher standards of accommodation are needed to secure their future.
  7. DfES and Department for Communities and Local Government (DCLG) have stated that funding is available to authorities in support of looked after children through the general revenue system and that this justifies the use of a threshold for payment of the DfES grant. ALG and LGA have pressed for these allocations to be identified but officials have stated that as the Children’s Social Care block of the Revenue Support Grant (RSG) system is “unhypothecated” it cannot be proved, or disproved, that there is some provision for funding for care leavers included in it. ALG and LGA therefore considers there is no case to suggest that there is funding in the RSG system for supporting young asylum seekers leaving care below the threshold – whether 25 or 44 – and that the use of any threshold should be discontinued.

Next steps

  1. The ALG has raised a number of points in submissions to Ministers:
  • The Hillingdon Judgment should be treated as a new burden under the DCLG New Burdens Doctrine. Government as a whole is committed to ensuring new burdens falling on local authorities are fully funded. As a result, for 2005/06, the DfES should meet the full costs incurred by local authorities in support of young asylum seekers leaving care. The agreed formula would provide just £15.8 million, and this must be met as a minimum, but this would still leave a significant shortfall to local authorities. For 2006/07, the DfES should provide support for actual costs incurred by local authorities subject to audit.
  • As with other Government funding, grant conditions for the DfES grant should be published in November before the start of the financial year and payments made promptly. Funding announcements have in the past been made after local authority budgets and council tax levels have been set. Payments are currently made well after the end of the financial year at further cost to local authorities.
  • The Government should nominate one department to lead on the funding of asylum seekers to ensure a more simple and transparent system. Local authorities are currently navigating complex funding streams from DfES, Home Office and Department for Work and Pensions, where asylum seekers are eligible for benefits.
  1. The ALG and LGA will continue to work with the Home Office to finalise special circumstances claims and make the case for full funding of costs to support asylum seekers in 2005/06 and beyond, subject to the usual audits.
  2. The Chairman of the ALG met with Ruth Kelly, MP on13 July 2006 to discuss the financial impact of these issues for local authorities. Parmjit Dhanda, MP wrote to the ALG and LGA on 30 June 2006 to agree to a joint meeting to discuss funding from the DfES and a date is being sought.

Financial Implications for ALG

None

Legal Implications for ALG

None

Equalities Implications for ALG

The grants are only available to unaccompanied asylum seeking children or young people who were formerly unaccompanied asylum seeking children.

Appendices

None

Background Papers

None