Question proposed, That the clause stand part of the Bill.

It is a pleasure to serve under your chairmanship, Mr Stringer. I look forward to working through the measures in this landmark Bill with all Members, as has been the spirit so far.

The children’s social care market is not working effectively. The Competition and Markets Authority and the independent review of children’s social care recommended a regional approach to planning and commissioning children’s care places. My Department will support local authorities to increase the number of regional care co-operatives over time. As Members will have noted, the clause refers to those as “regional co-operation arrangements”. As a last resort, the legislation will give the Secretary of State the power to direct local authorities to establish regional co-operation arrangements.

Where a direction is in place, regions will be required to analyse future accommodation needs for children, publish sufficiency strategies, commission care places for children, recruit and support foster parents, and develop or facilitate the development of new provision to accommodate children. We expect regional care co-operatives to gain economies of scale and to harness the collective buying power of individual local authorities. I hope that the Committee will agree that this clause should stand part of the Bill.

Regional co-operation is something that the previous Government were extremely enthusiastic about and worked to build up, so the Minister will not be surprised to hear that we support the clause. The previous Government’s “Stable Homes, Built on Love” policy paper said that the Government would work with local authorities to test the use of regional care co-operatives—regional groupings of authorities to plan, commission and deliver care places—in two areas. Those two pathfinders would trial an approach within the legal framework, with a view to rolling it out nationally following evaluation as soon as parliamentary time allowed. Were we in office, I suspect that we would be very much considering the same clause. This Government have announced that those two pathfinders are going ahead, in Greater Manchester and the south-east, from this summer.

When we consulted about the idea—it is a good idea —there was a lot of support, but there were also a lot of concerns and questions about the size of the groups, the risk that they would be too removed from the child, and the loss of relationships with small providers in particular. As the Minister said, this is a recommendation from previous work, including from the independent review of children’s social care, which we commissioned. Obviously, we hope that such groups will be useful in providing local authorities with greater purchasing power and more options when they are securing accommodation for children in care, but we think it is important to be clear about the objectives to avoid any unintended consequences. I have come to think that, often, it is when we all agree that we are doing a good thing that we should ask ourselves the difficult questions to ensure that we are not making a mistake.

The key issue in the “children’s home market”—I put that in scare quotes, because I hesitate to use the phrase in the current context—is a lack of supply, which leads to children being placed far away from their roots and support networks in accommodation that does not always match their care plan. We then see children going missing and having repeated placement moves. I wonder whether the Minister will put on record in Committee the aims for the regional care co-operatives, other than purchasing power, and how they will address the other issues.

Will the Minister respond to some specific issues raised in our consultation? One issue is that it is harder for smaller providers and specialist charities, which are obviously part of the offer for children in care at the moment, to engage with regional care co-operatives. What does he think about that risk and what does he plan to do about it?

Does the Minister share the concern raised by Barnardo’s that the measure could inadvertently lead to greater fragmentation in the system by separating decisions about the commissioning of placements from decisions about the commissioning of family support? That is a thoughtful question. What is he doing to avoid that being a problem? We are all positive about regional care co-operatives, but I wonder whether there were any lessons from the build-up to the two pilots that we were proposing, whether he has seized on any issues and whether he is planning to address them, even as we do what we all agree is a good thing.

It is a pleasure to serve under your chairmanship, Mr Stringer. I will ask the Minister a couple of questions about clause 9 that I hope he will address when he responds. We support its intent, but I want to understand what safeguards or guidance will be put in place to ensure that children in care in areas where these regional co-operatives are active do not inadvertently end up far away from their families.

We already know that about a fifth of children in care are placed over 20 miles away from their families and almost half are living outside their local authority area. In some cases, it is important that a child is moved reasonably far away for safeguarding reasons, but often that is not the case. I know from having spoken to care-experienced young people and to the Become Charity, which has done quite a lot of research into the impact of children being moved far away from home, that that can affect their mental health, that they can feel isolated and lonely having moved away from family and friends, and that it can cause stigma in the school or college environment. I want to understand how the Minister intends to ensure that young people are not moved further away than they need to be when these regional co-operatives are in place.

Again, as hon. Members have said, we support this approach and it is the approach that we were taking. It is also true that when everybody agrees on something, it is usually the point of most danger for making bad law. It is important to have these Committee proceedings and proper scrutiny.

I was personally never keen on the name of regional co-operatives, although I do not think the word “co-operative” actually appears in the Bill. We can, of course, have co-operation without having a co-operative. This legislation is actually about regional co-operation arrangements.

There are three different types of potential co-operation arrangement: first, for strategic accommodation functions to be carried out jointly between two different local authorities; secondly, for one to carry out the duties on behalf of all; and thirdly, for a corporate body, effectively a separate organisation, to be created to do that. I imagine that Government Members will have different views depending on which of those three forms the arrangements take. Will the Minister say which of those he expects to be most common? As well as the pilots, there have no doubt already been formal and informal conversations with local authority leaders in children’s services in many different areas.

I am keen to know how this arrangement is different from some arrangements that may already take place. For example, the tri-borough children’s services arrangement in London—I will try and get this right—between Westminster, Kensington and Chelsea, and Hammersmith and Fulham. Presumably, some of those functions are administered in common there, so how will this be different?

I probably should have asked the Minister about scale. In the two pilots, we have Greater Manchester, which is just under 3 million people, and the south-east, which is roughly 3 million people. I do not know what the Government’s expectations about scale are and whether they would continue to support something like the tri-borough arrangement, which is obviously much smaller.

My hon. Friend, as ever, makes a very apt point. Where we end up on that continuum of scale depends on what we are going after most. Of course, we want all those things. For purchasing power, a bigger scale is better, but for close and easy working relationships, a smaller scale is sometimes better. When we are talking about children, and the placement of vulnerable children, that may well push us towards the smaller end of the scale.

Perhaps it is possible to perform different functions at different levels, with some functions still being performed by the individual local authority. Even then, as my hon. Friend often rightly says, there is an enormous difference in scale between London local authorities, which are actually quite small even though they are in our largest city, and Birmingham, which is one enormous authority. It might be argued that doing some things at a sub-local authority level makes sense in a very large local authority area, but as I say, it might be possible to do some things as the single local authority, some things at a larger level, and some things—presumably principally in terms of purchasing leverage—on a wider scale again.

If regional co-operation arrangements are not materially different in practice from something that already exists in co-operation between local authorities, even if that is on a smaller scale than what is envisaged, is legislation actually necessary? If it is not, we probably should not legislate. I would like to understand a bit more about the legislative basis that is currently missing.

Finally, the Bill sets out that the Secretary of State may add to the definition of the strategic accommodation functions that we have listed in proposed new section 22J(3) of Children Act 1989. What type of additional functions does the Minister have in mind?

I rise to speak in favour of regional co-operation arrangements, primarily because of what we have seen in two important reviews or evaluations. The recent independent review of children’s social care that I referred to highlighted a system at breaking point, as we also heard from the Minister. The insight from that report was that how we find, match, build, and run foster homes and residential care for children in care radically needs to change. When the Competition and Markets Authority looked at this area, it also identified major problems, such as profiteering, weak oversight and poor planning by councils—the verdict on the system is damning.

The independent review recommended that a co-operative model should sit at the centre of bringing about change. The values of our movement could provide the loving homes that children in care need. I particularly support this clause because this feels like a very Labour Government Bill—one that has at its heart the co-operative model that is obviously such a big part of our labour movement.

My hope is that regional care co-operatives could gain economies of scale and harness the collective buying power of independent local authorities to improve services for looked-after children. There are obvious benefits to using a co-operative model to solve those problems—the values of self-help, self-responsibility, democracy, equality, equity and solidarity apply directly to how these regional care co-operatives would be run. In a social care market that has been described as broken by the Minister and by those reports, it is critical to bring the co-operative model more into what we provide.

I thank hon. Members for their thoughtful comments, suggestions and questions. On the point that the hon. Member for Harborough, Oadby and Wigston made about learning from the pathfinders, the Department has consulted widely with the sector on the proposals for regional care co-operatives. Learning from the pathfinders has shaped the proposed legislation and the definition of the strategic accommodation functions. We will develop expertise in areas such as data analysis and forecasting, as well as targeted marketing, training and support for foster carers. Working collectively with improved specialist capabilities should allow for greater innovation so that local areas are better able to deliver services for children in care.

I turn to the points made by the hon. Member for Richmond—

Twickenham. We are in Richmond borough.

My apologies. I did know that, but I was trying to be impressive by remembering the hon. Lady’s constituency and I got it badly wrong.

On the hon. Lady’s point about where placements should be, local authorities will continue to have the same statutory duties to find the most appropriate place for looked-after children, including that they should live near home, so far as is reasonably applicable. Regional care co-operatives will assist local authorities with these duties. Placement shortage is a key driver of children being placed in homes far from where they live; regional care co-operatives should improve that by increasing local and regional sufficiency, making more places available locally for children who need them.

Will the Minister confirm that—as I think is the case—the Government would use their powers under the clause to impose regional co-operation agreements only as a last resort, and that we would not push this on everybody who does not want it?

The shadow Minister is absolutely correct. We want to work collaboratively with local authorities in rolling this out. We will not force local authorities to do so. I thank him for enabling me to make that clear.

Question put.

Forgive me, Mr Stringer; I know that the Minister has finished, but may I speak again, with leave?

I have put the Question. I am sorry, but you have missed the opportunity.

Question agreed to.

Clause 9 accordingly ordered to stand part of the Bill.