The inter-agency fee: to subsidise or not to subsidise?

The recent publication of DfE’s evaluation of the inter-agency fee grant has opened up the discussion on adoption matching and funding models.   


The adoption process can be fairly complex and difficult to understand, even for the most informed. When a decision is made that a “looked after” child should be adopted, the local authority (LA) is responsible for finding the perfect family. However, LAs don’t always have access to suitable, internally-vetted prospective parents. In these cases, they may get in contact with other LAs or voluntary adoption agencies (VAAs), which may be able to propose a suitable match. However, this process comes at a cost - an inter-agency fee is paid to cover the other agency's cost of recruiting, assessing and approving the adopters. Evidence has shown that a reluctance to pay this fee may create delays in the adoption process, make family finders reluctant to widen their search, increase the degree of compromise on child’s needs or adopters’ preferences (Farmer and Dance, 2016) and act as a barrier to inter-agency placements, especially for children with ‘harder to place’ (HTP) characteristics (i.e. aged 5 or older, disabled, with siblings, with a BME background or children who have been waiting for a placement for over 18 months).

To address some of these issues the Government created the Inter-Agency Adoption Fee Grant, to reimburse the money LAs spend on the fee for HTP children. The grant initially subsidised placements which took place between 8 July 2015 and 31 October 2016, but then it was extended until 31 March 2017. The target of the grant was to remove any barriers to transferring a child’s case to another agency and make the process faster. But, did it actually have an impact?

Was the grant effective?

The Department for Education has recently published an evaluation of the grant to explore how effective it was in different aspects. The researchers who undertook the evaluation combined quantitative and qualitative analysis by using data for 500 children with a placement order made between April 2014 and March 2016 and conducting in-depth interviews, focus groups and telephone interviews.

The key finding of the evaluation was that the speed of matching had increased significantly during the period when the subsidy was available, as the average time into identifying a match was shorter than in the preceding year and a greater proportion of children were matched within 6 months of placement orders. However, the researchers state that it is not possible to say that this was a direct result of the subsidy, as there are other factors that might have affected timeliness, e.g. a drop in the numbers of children with placement orders and the establishment of LinkMaker, as a routinely used family-finding resource. During the interviews and focus groups, the majority of participating agencies said that the subsidy had not made much difference to the way they approached family finding. However, some of them admitted the grant had a significant effect as it eliminated the need for management approval for external searchers, enabling wider and quicker family search. Moreover, the qualitative analysis revealed an appreciation of the subsidy by all agencies.  

Other findings of the analysis showed a pronounced need for increased training and education for adopters, as well as a preference for ‘in-house’ placements by professionals, which was associated mainly with issues of communication, information sharing and trust with other agencies, rather than financial incentives.

Although the study reveals a small impact of the subsidy on the way that VAAs and LAs work together and no clear effect on timeliness, it is important to keep in mind that the grant was known to be a temporary change. These temporary pots of money are not beneficial to the sustainability of the sector, which would benefit from more certain, long-term funding streams. The behaviour of LAs and VAAs could have been different in the event of a permanent policy. Another important aspect indicated by some professionals who participated in the study is that the subsidy could have been better publicised to frontline staff.

alma economics