Money Matters and Insurance

Contents

1. Introduction
2. Weekly Allowance Rates
3. Foster Carer Allowances and Fees
4. Income Tax
5. Claiming Benefits While Fostering
6. Pensions
7. Insurance

1. Introduction

As an approved Foster Carer you will receive at least the minimum fostering allowance. In addition there is opportunity to receive a skill level payment dependant on your knowledge, skills and on-going training and development. The rates of allowances and skill level payments are listed on the tables below.

If you have any queries about allowances or if you think you have been under or over paid, contact the finance section in the Fostering Service as soon as possible.

Payments to you are made in arrears, direct to your bank or building society.

2. Weekly Allowance Rates

See: City of York Council Website for more information.

3. Foster Carer Allowances and Fees

Foster carer allowances and fees

The weekly allowance

The foster carer weekly allowance is intended to cover the average costs of looking after a child as part of the foster carer’s family. No specified amounts for particular items are given since expenditure will vary from one foster household to another. The fostering allowance is designed to cover the following costs

• Food and accommodation (including a contribution towards heating and lighting costs);
• Clothing;
• Pocket money;
• Transport usually associated with any child living in a family including to and from a local school and out-of-school activities;
• Leisure activities;
• Keeping a record of events and memories about the child; and
• School meals.

Birthday, Festival, Holiday allowances

It is accepted that there are important events which incur additional costs for foster carers. Accordingly, a payment equivalent to one week’s fostering allowance is automatically paid prior to the child’s birthday and also prior to the festival period. A further amount equivalent to 3 weeks fostering allowance can be made to cover the cost of holidays through the year. This should be discussed with supervising social worker.

Costs not covered by the foster carer weekly allowance

There may be other costs which are not covered by the weekly fostering allowance. These additional costs fall into two broad categories – those related to the child or young person in placement and those related to the foster carer’s home.

Child related costs

1. Activities and interests

Children are encouraged to enjoy out of school activities, which enrich their leisure and play. Examples have been drama, horse riding, singing, instrument lessons, sport, swimming, dance, arts and crafts

A foster carer can request support with the costs of an exceptional enrichment activity for an amount up to £500 per child per annum.  If there is a greater cost, this should be discussed as part of the child’s care plan.

The cost of hobbies is usually expected to be covered by the fostering allowance. If however a hobby includes an exceptional cost for an event, for example a piece of equipment, then a foster carer may request an additional payment to cover the cost. The maximum sum will be £250 per child per annum.

2. Clothing allowance (start up)

A child or young person who arrives in a new foster placement without adequate clothing is likely to incur additional clothing costs.  A foster carer can claim a clothing allowance at the commencement of the placement of a newly looked after child up to a maximum equivalent to 3x the weekly allowance.

3. Clothing allowance (exceptional circumstance)

A foster carer may identify a situation in which a looked-after child has an exceptional need for clothing allowance. This might be for a special event such as a wedding or other celebration. For older teenagers this might include school proms or job interviews.  Such exceptional needs should be discussed with the supervising social worker (fostering) who will forward a request to the Service Manager (Fostering).  The maximum sum paid will be £250 per child per annum.

4. School uniform allowance

A foster carer may request a school uniform grant for a looked-after-child who has recently commenced at a new school.  For planned changes in school uniform, for example in moving from lower to upper school, it is expected that foster carers will budget accordingly.

5. Work clothing and equipment

A foster carer may request a grant towards the cost of work clothing that a young person requires at the commencement of training or employment. The maximum sum will be £200 per young person per annum.

6. Tuition

Private tuition will not be funded by the Department as it is recommended that this is dealt with in personal education planning. If there is general agreement that additional tuition will be beneficial, this will be addressed by the child’s social worker in conjunction with the school and education colleagues.

7. School trips

All young people will have the opportunity to take part in school trips; the cost ultimately will be supported and covered by children’s services.

8. Holiday supplement

A foster carer, in common with other parents and carers must ensure that all looked after children attend school during the school term. It is noted that parents, carers and foster carers may therefore face increased costs for booking holidays during the designated school holidays.  In recognition of this increased cost, a supplement is available for each looked-after-child up to a maximum of £400 per annum.

A request for payment of a holiday supplement will need to include evidence that the cost of the holiday for each child is greater than the existing holiday allowance provision.

A foster carer can claim for the costs incurred in purchasing a passport for the child and any visa, which may be required for holiday travel.

9. Nursery fees, after-school, holiday clubs

If a looked after child attends a nursery, after-school club or holiday club, consideration will be given to reimbursing additional costs incurred by foster carers. Agreement for children or young people to attend any of these settings must be made in consultation with the child’s social worker and relate to the benefits for the child’s educational and social interaction rather than the foster carer’s domestic arrangements or other commitments.

10. Contact expenses

A foster carer may claim the reasonable costs incurred to facilitate young people maintaining and promoting contact with their parents, siblings or other significant family members

11. Health care expenses

Health care for children are generally exempt from charges under the NHS. In exceptional circumstances, foster carers may request the reimbursement of unavoidable costs, for items which may not have been exempt from charges e.g. glasses, immunisations for holidays

12. Other exceptional expenses

The above list cannot be exhaustive. A foster carer may request a contribution to cover the costs which may be incurred for a looked after child’s participation in a special event family wedding, school prom, entering a competition.

If a foster carer is aware of any exceptional expense, they may discuss this with their supervising social worker (fostering) in order for the Service Manager (Fostering) to consider the implications. A foster carer should not enter into the commitment to an exceptional expense without checking whether there is scope for its reimbursement.

Household related costs

Foster carers are expected to have the necessary physical resources within their home to enable them to provide a good quality of service to the children and young people they look after. It is expected that the need for additional equipment and the replacement of any equipment, furniture or furnishings, will be assessed as part of the foster carer’s annual review process.

1. Equipment and furniture

Foster carers may need additional furniture and equipment before having looked after children placed with them. This may include beds, bedding, storage for clothes, car seats, baby equipment (where applicable).  Other equipment costs may be incurred when new long-term placements are organised. These might include the decoration of a bedroom or the provision of new bedding. These costs may be reimbursed. Reasonable cost of this provision will be reimbursed.  

2. Equipment, furniture, repairs and replacement

Over time a foster carer there may be wear and tear on furniture, equipment and furnishings. Foster carers may request a grant towards the cost of renewing such items Where specific damage has been caused by a looked-after child then this should be reported to the supervising social worker who will arrange for an insurance claim or an ex gratia payment.

3. Exceptional adaptations

A foster carer may, in exceptional circumstances request financial support for the adaptations to their house to help meet those needs such as providing a long-term placement for children with special needs.

Transport

1. Travel and transport arrangements are expected to be discussed as part of the initial planning of all placements. Where circumstances change significantly then foster carers are expected to discuss those changes with their colleagues. There is general assumption that looked after children and foster carers will undertake most journeys in their day-today fostering lives, by walking, cycling, and using public transport or in the foster family’s car. The cost of local and family journeys are included as part of the weekly fostering allowance;
2. Public transport and bus passes

It is assumed that young people aged 12 and over will make use of public transport where necessary for school and leisure activities. Accordingly, all young people are now eligible for an all-day bus pass for First York within the City of York area. For young people placed outside the York area, corresponding arrangements will be made to cover bus pass provision/reimbursement.

3. Mileage allowance

A foster carer may request reimbursement of their mileage allowance for exceptional journeys, which are above and beyond the local school and family journeys e.g. school journeys greater than 3 miles (each way) transport to contact, hospital or other clinic appointments.

4. Bicycles

For young people aged 11 and over, the purchase of a bicycle with all safety equipment, is eligible for reimbursement if this will enable them to cycle safely to school and for their leisure time. Any proposed bicycle purchase should be fully considered and cost agreed by the Service Manager (Fostering) prior to any foster carer committing to a purchase. Provision of a bicycle should be considered in the context of the child’s travel/transport plan.

5. Mopeds

For young people 16 and over the purchase of a provisional driving licence for mopeds up to 50cc, Compulsory Basic Training (CBT), appropriate safety equipment can be supported. Requests for the support and funding of these items and for a contribution towards the purchase of a moped should be fully considered with relevant parties as part of the travel/transport plan and cost agreed by the Service Manager (Fostering) prior to any commitment to a purchase is given.

6. Driving lessons

For young people 17 and over the purchase of a provisional vehicle driving licence and starter pack of 10 driving lessons can be supported but should be considered with relevant parties and cost agreed by the Service Manager (Fostering) prior to any commitment to purchase is given.

Foster Carer Fees

After initial approval, a foster carer is assessed and reviewed under the accreditation scheme to determine the grade within the fee structure (accredited, experienced, enhanced and advanced)

All foster carers on an accredited or higher level are paid a fee when they have a child or young person in placement. Payments of the fee can continue when a foster carer is temporarily without children in the following circumstances

1. When a foster carer does not have a child in placement the fee will continue to be paid for up to 4 weeks;
2. When a foster carer takes a holiday break without the foster children the fee may continue to be paid for up to 2 weeks. Foster carers are expected to give a minimum of 1 month’s notice to allow an alternative placement to be arranged;
3. Foster carers may request two weeks additional fostering fee at any point in the financial year from 1 April to 31 March;
4. A maximum of 4 weeks in total in any year will be covered by these payments.

Foster carers who are undergoing an investigation that prevents them having children placed with them will continue to be paid a fee until the investigation is completed.

Process for claiming an additional payment

In order to ensure consistency in the application of the guidance, it is proposed that all requests for additional payments will be dealt with by the foster carer’s supervising social worker. A foster carer will be expected to provide evidence of the cost incurred through receipts or estimates. This can be submitted electronically. Foster carers should retain original documentation for future reference.

When social workers, other service managers or independent reviewing officers become aware of an exceptional need or cost for a looked after child placed with a foster carer, they must refer the matter to the supervising social worker (fostering) for their consideration. The authorisation (or not) for additional payments will be given by the Service Manager (Fostering).

4. Income Tax

When you are fostering, you will need to be registered as self-employed and file tax returns. See File Your Self Assessment Tax Return Online.

You will be entitled to qualifying care relief which means that you will be entitled to:

Tax exemption

In a tax year, households do not pay tax on a fixed amount of the money they earn from fostering. You will still pay tax on money you earn from a job or investment.

Tax relief

On top of this exemption, you also get tax relief for every week (or part week) that a child is in your care.

All payments made to you will be itemised. You should keep this information as a record for income tax purposes.

For further information and current figures, please see: Foster Carers Relief Information (HMRC) and Help and Support for Foster Parents in England.

5. Claiming Benefits While Fostering

See relevant information on the GOV.UK.

6. Pensions

If you foster you may be eligible for National Insurance Credits which count towards your State Pension. Your supervising social worker will be happy to provide you with a letter to confirm your approved fostering status if required.

7. Insurance

You must inform your Home, Building and Contents and Car insurance company once you have been approved as a foster carer.

Tell them about the numbers of children and age ranges you expect to take. You should ask the insurance companies for written confirmation that they have included foster children on your policies.