How are specialist foster care allowances calculated?

Specialist foster care allowances are usually worked out from the expected cost of caring for a particular child, with the fostering provider’s approved payment framework then applied to the placement. There is no single national rate for specialist fostering. Each provider sets its own structure, so the assessment and approval process should explain exactly what the allowance includes, how it is paid and when it is reviewed.

The amount may contain two separate elements:

• A fostering allowance: money intended to meet the everyday costs of caring for the child, such as food, clothing, household costs, activities and travel.
• A fostering fee or professional payment: a payment that recognises the foster carer’s time, responsibility, training and contribution. Some providers include this within an overall payment, while others show it separately.

These elements should not be confused with one another. An allowance is designed primarily around the child’s care costs, whereas a fee reflects the role undertaken by the foster carer. Ask the provider for a written breakdown so you understand which part covers expenses and which part represents the fostering payment.

When a specialist placement is considered, the provider may examine factors such as:

• the child’s age and daily care requirements;
• the level of supervision or support needed;
• health, developmental, emotional or behavioural needs;
• the impact of appointments, education arrangements and family contact;
• additional transport, equipment, adaptations or activities;
• the likely effect of the placement on other children and household routines;
• whether more than one foster carer needs to be available for particular parts of the day; and
• the specialist experience, training or practical skills required from the approved foster carer.

A child’s diagnosis or background does not, by itself, determine the payment. The relevant question is how the child’s individual needs affect the work, costs and level of responsibility involved in the placement. Two children with a similar diagnosis may therefore attract different arrangements, while a child without a formal diagnosis may still need a highly supported placement.

The calculation normally takes place alongside the matching discussion. The provider should consider whether the proposed payment reflects the care plan, the placement expectations and the resources available in the foster home. If circumstances change, for example because needs increase, arrangements become more intensive or extra costs arise, the payment should be discussed with the supervising social worker and reviewed under the provider’s procedures.

Before accepting a specialist placement, ask for clear answers to these practical questions:

• What is the total payment and how is it divided between allowance and fee?
• Which regular expenses are included?
• How are one-off costs, specialist equipment and unusual travel handled?
• Is the payment different during introductions, respite, planned breaks or periods when the child is away?
• What circumstances trigger a review?
• How are changes agreed and recorded?
• Are there tax or record-keeping responsibilities for the foster carer?

Payment arrangements can also be affected by the type of placement, its planned duration and whether additional services or support are commissioned. The provider should explain these details before approval or before a placement is accepted, rather than expecting a foster carer to rely on a general headline figure.

Foster carers should keep records of agreed expenses and retain the payment information supplied by their provider. Tax treatment and allowable expenses can depend on the carer’s circumstances and the rules in force, so independent tax advice may be appropriate. The most reliable figure is the current written offer for the specific placement, not an amount quoted for a different child or at an earlier stage.