How are fostering allowance rates calculated?

Fostering allowance rates are calculated by applying the fostering service’s payment framework to the costs and circumstances of a particular placement. The calculation normally starts with a standard allowance for the child’s age group, then considers the placement type, the child’s assessed needs and any approved additional payments.

The standard allowance is intended to contribute towards the ordinary costs of caring for a child. This can include food, household costs, clothing, personal items, activities and other everyday expenses. Age bands are used because the likely cost of caring for a younger child can differ from the cost of caring for an older child or teenager. The allowance is not calculated solely from the child’s age, however; it is a starting point within the wider assessment.

Factors that may affect the calculation include:

• The child’s care needs: social, emotional, behavioural, health or developmental needs may create additional costs or require more support than ordinary day-to-day care.
• The placement arrangement: short-term, long-term, respite, emergency, parent-and-child and specialist placements may be covered by different payment arrangements.
• The level of supervision required: a child who needs additional appointments, structured activities, specialist equipment or closer supervision may require an enhanced allowance or separately agreed support.
• The number of children placed together: sibling groups and multiple placements are considered according to the needs of each child and the practical costs of caring for them together.
• Local and service-specific policy: fostering services set out how their allowances, enhancements and other payments operate, subject to the relevant regulatory and local arrangements.

Some fostering services use a basic allowance with additional elements added where a placement meets defined criteria. Others may use different bands for different types of care. For that reason, two placements involving children of a similar age may not always attract exactly the same overall payment.

The assessment process provides the information needed to decide whether an enhanced rate is appropriate. This may involve reviewing the child’s care plan, known risks, education and health requirements, contact arrangements, transport needs and the practical demands placed on the foster household. The rate should reflect the approved placement plan rather than an assumption that every child of the same age will cost the same to care for.

Allowances are also reviewed when the circumstances of a placement change. A review may be appropriate if a child’s needs increase, the placement moves to a different category, additional equipment is required or the agreed care arrangements become more demanding. Foster carers should raise changes with their supervising social worker or fostering service so that the financial arrangements can be considered alongside the care plan.

It is important to ask how the quoted rate is structured. In particular, prospective foster carers should check which everyday costs are expected to come from the standard allowance, which expenses can be claimed separately and whether additional payments need prior approval. This can include questions about equipment, activities, travel, clothing, education-related costs and exceptional expenses. The written terms provided by the fostering service should explain the arrangements for the specific placement.

The allowance should be considered separately from any fee paid for the foster carer’s role. The allowance relates to the costs of caring for the child, while a fee, where offered, recognises the carer’s skills, time and responsibilities. Whether a fee applies, and how it is calculated, depends on the fostering service and the placement arrangement.

When comparing fostering allowance rates, look beyond the headline weekly figure. A meaningful comparison should include the age band, placement category, possible enhancements, expenses covered separately and the support available to manage changing needs. Become A Foster Family can explain how the relevant payment framework applies during the fostering assessment and approval process, helping applicants understand the likely financial arrangements before they accept a placement.