Almost a third of council funding is spent on children's social care, new analysis has revealed. with the increasing need to put local authorities at risk of bankruptcy.
Thousands more vulnerable children have been referred to local authorities since the pandemic and councils are spending more to keep up with the rise in need.
A group of 47 urban local authorities in England, the Local Authority Special Interest Group (Sigoma), has warned that some councils are spending almost half of their funding on childcare services.
The average Sigoma councilor now spends 29 per cent of their core spending power on children's services, compared to just 15 per cent in 2011/12, the analysis revealed.
Almost 84,000 children are currently looked after by local authorities – a record high – latest government figures show.
Councils in the poorest areas have been hardest hit, with the 15 most deprived authorities more than doubling their spending on children's services as a proportion of overall budgets.
Money spent on children's services has fallen from 15 per cent of these councils' spending in 2011/12, to 31 per cent now.
In Blackpool, spending on children's services has fallen from 15 per cent to 45 per cent.
Sigoma Council Association chairman Sir Stephen Houghton said rising spending on children's services was pushing more councils to the brink of bankruptcy.
10 per cent of local authorities surveyed by Sigoma said they were considering issuing a Section 114 this year – a notice which tells the government the council is about to reach an illegal level of overspending.
Sir Stephen said: “Our members tell us that some specialist placements for the most vulnerable children can cost up to £1 million a year, with many costing between £250,000 and £750,000.
“These demand pressures are leaving councils financially stretched and at breaking point.”
Jim Hobson, Blackpool Council's member for children's services, said: “Each year we are expected to save tens of millions of pounds without any reduction in demand for our most important services, such as children's and adult social care.”
Councils across the country are seeing an increase in referrals of vulnerable children, The independent revealed in July. Around 283,000 children needed support from the county council this year, an increase of 16,000 on last year.
Of the 36 county councils, 30 had overspent their budgets by £316 million. Children's social workers said the increase in need was a result of the pandemic and the cost of living crisis.
“Increased poverty, increased mental health problems, increased domestic abuse are contributing to the increase in referrals,” said Patrice Bentick, a member of the British Association of Social Workers.
The Department for Lifts, Housing and Communities has been contacted for comment.