Final Terms of Reference - Review of out-of-home care costs and pricing - 21 May 2024

We carefully reviewed all submissions we received. In consultation with the Premier, the Terms of Reference have been amended to reflect stakeholder feedback. 

In summary, the changes made to the Terms of Reference include: 

• generalising the description of casework tasks that we need to include in our assessment of efficient costs to include all aspects related to the delivery of out-of-home care from entry to leaving care 
• generalising the additional casework and legal support required to support court work and removing reference to interim court orders 
• generalising the categories of OOHC programs for which we will develop benchmark costs as:
  • home-based care
  • residential care
  • living independently
  • emergency arrangements.

Within these categories, we will consider the different needs and characteristics of children and young people receiving care. 

• removing reference to incentivising outcomes for our recommendations on pricing structures and levels 
• making explicit in the ‘relevant considerations’ that we will consider:
  • how the costs of delivering services vary by location
  • the additional support required by
    • Aboriginal children, young people and carers
    • children, young people and carers with a culturally and linguistically diverse (CALD) background
    • children, young people and carers with disability.

Some submitters suggested our review should consider the quality of services, concerned that a review of efficient costs would recommend the lowest cost services. However, estimating the efficient costs of services does not mean that services should all be funded at the least cost, rather, that they should be funded at the level required to meet the varying needs of children and young people. 

As set out in the Terms of Reference, our review is about ensuring services are funded at a rate that reflects the efficient cost of providing quality, tailored services to children and young people in care in line with service requirements and accreditation standards. In this context, our review will also be guided by the objects and principles of the Children and Young Person (Care and Protection) Act 1998 (NSW), including the Aboriginal and Torres Strait Islander Child and Young Person Placement Principles. 

We will not be assessing the outcomes for children in out-of-home care as part of our review of costs and pricing. This has recently been considered in the Evaluation of the Permanency Support Program and we will consider its findings, along with other research and reviews being undertaken in the sector, in our review. We have however removed reference to incentivising outcomes in pricing structures and levels due to concerns from stakeholders that this could result in perverse outcomes and some children being prioritised ahead of others.

We received a number of submissions from the carers of children and young people in care. Many of these submissions raised concerns about the adequacy of the carer allowance and the challenges of caring for children with higher needs. We appreciate these submissions and will consider this feedback as part of our review.

We will be making recommendations on care allowances for providing care to children and young people in out-of-home care as part of this review. There will be further opportunities during the review for carers and other interested stakeholders to give us their feedback and share their experiences.