Welsh government consults on move to not-for-profit model in children’s social care

The 12-week consultation, launched on 1 July, seeks views on two proposed changes to children's social care in Wales.

The proposals would:

• restrict the further expansion of existing for-profit children’s services by preventing the addition of new beds in for-profit children’s homes and the approval of new foster carers by for-profit fostering service providers; and
• enable continuity of foster carer approvals by allowing, in limited and clearly defined circumstances, foster carer approvals to be deemed to transfer where a for-profit fostering service re-establishes as a not-for-profit fostering service.

On 24 March 2025, the Health and Social Care (Wales) Act 2025 (the 2025 Act) became law in Wales.

The 2025 Act includes, within Part 1, Chapter 1, provisions intended to restrict the extraction of profit by providers of children’s home services, secure accommodation services and fostering services. These are known collectively as ‘restricted children’s services’. 

In a written statement published last week (8 July), Delyth Jewell MS, Deputy Minister for Social Care, Mental Health and Women’s Health, said: “I am pleased to update Members on the Welsh Government’s continued commitment to removing profit from the care of children who are looked-after, as we proceed with the next phase of implementing the Health and Social Care (Wales) Act 2025.

“Last week I launched [a] consultation on proposals for regulations that will impose restrictions on any further expansion of existing for-profit restricted children’s services from 1 April 2027. The proposed restrictions mean existing for-profit children’s homes would not be able to add additional beds, and for-profit fostering services would not be able to approve new foster carers. Crucially, these measures will not affect existing placements or currently approved foster carers.

“The consultation also seeks views on short-term, transitional arrangements to support continuity of pre-existing foster carer approvals where a for-profit fostering service re-establishes itself as a permitted not-for-profit entity (and registers this with Care Inspectorate Wales (CIW), under the new requirements of the Act). This will help avoid any disruption and limit unnecessary duplication where there is clear organisational continuity and all appropriate safeguards are in place.”

She added: “Alongside these regulatory measures, financial support remains an important part of successful delivery. Alongside revenue funding to both local authorities and to Cwmpas to support implementation and advise existing providers capital support is also continuing through the Integration and Rebalancing Capital Fund. Projects supported through this fund are designed to help build capacity in public and not-for-profit provision and are wholly aligned with the objectives of the removing profit agenda.”

The consultation is open until 23 September 2026.

Lottie Winson