Children's Hearings System - future of secure care and the single point of contact (SPOC) for victims: consultation

6. Funding, commissioning and co-ordinating secure care

The way Scotland funds and commissions secure care determines not only financial sustainability but also equity of access, quality of care, and the long-term sustainability of the charities operating in the sector. The current model has strengths in flexibility and responsiveness but has also created challenges in consistency, cost, and national oversight.

Key features of the current secure care provision include:

• Spot-purchasing and local commissioning arrangements by individual local authorities and Scottish Ministers.
• Secure providers require high occupancy thresholds (around 90%) to break even, limiting flexibility when individual children present with exceptionally complex needs, and making centres financially vulnerable to demand fluctuations.
• Lack of central oversight, limited data on who is being placed or not placed, and no national mechanism to monitor demand, progress or outcomes across the system.
• National variation in the use of secure care by placing authorities.
• Recruitment and retention challenges within the secure care workforce.

Given these systemic challenges and building on the government’s ‘Reimagining Secure Care’ response, it is timely to consider more fundamental reforms – up to and including the nationalisation of secure care, new funding models, and more flexible models of care.

6.1 Commissioning and co-ordinating secure care placements

Scotland’s secure care system does not have a national placement commissioning mechanism or national oversight of placement decisions, the demand for secure care or an individualised assessment of the needs of each child for whom secure care places are being sought and how those might map to current or emergent vacancies in each of the centres. This creates the following challenges:

• Inconsistent placement availability: Local authorities may compete for limited secure care beds without a shared view of national capacity or centre-specific matching and capacity constraints.
• Lack of real-time data: No centralised system to track or coordinate placements.
• Inequity in access: children’s needs may not be matched effectively with available resources, especially in urgent or complex cases.

Coordinating secure care placements in Scotland is challenging because of the split responsibilities and limited national oversight:

• Local authorities are responsible for placing children whose placement in secure care has been authorised through the Children’s Hearings System, based on welfare and protection needs, children remanded to secure accommodation or sentenced to detention in summary cases by the Courts.
• Scottish Ministers are responsible for placing children who are sentenced on indictment by the courts to a period of detention in secure accommodation.

It is essential that Scotland maintains sufficient and sustainable capacity within secure accommodation. Depending on the route into secure accommodation, there may be no lawful alternative available (for example, in the case children sentenced by a court to detention in secure accommodation). The recent reforms by the Children (Care and Justice)(Scotland) Act 2024, which prohibit the use of Young Offenders’ Institutions for under-18s, further increase the demand on the secure care system to ensure that every child that requires a safe, secure environment can access it without delay, especially when there is no lawful alternative.

While community-based supports can and should prevent many children on the edges of secure care from needing a secure placement, there will always be a small number of children whose safety, wellbeing or legal status necessitates secure accommodation. For these children, secure care must be immediately available and their placement in secure must be sustained for as long as required.

Maintaining adequate secure care capacity is therefore not optional – it is a fundamental part of safeguarding children’s rights, meeting legal obligations, and ensuring that Scotland delivers a child-centred response to its most vulnerable children.

There is also no cohesive and holistic overview of the impact, experiences and outcomes for children who are being considered for, are in, or are leaving secure care.

The Promise calls for planning and provision to be based on understanding of need and data – including understanding the effectiveness of community-based supports - and the previous Scottish Parliament’s Justice Committee inquiry report noted the lack of a centralised monitoring system for the number of places or referrals to secure care. Within current approaches, such monitoring and data provision is impossible.

While published statistics on secure accommodation in Scotland are essential for understanding broader trends, they have limitations in capturing the fluid nature of secure placements and the immediate effects of acute capacity challenges and fluctuations in demand. Addressing these limitations will require a national approach.

The 2022 consultation on the policy proposals leading to the Children (Care and Justice) Bill sought views on whether a new national approach for considering the placement of children in secure care was needed. 90% of respondents agreed that a new approach was required. Many respondents believed a new national approach for considering the placement of children in secure care to be necessary based upon the consistency that it would offer, along with the associated benefits resulting from centralised monitoring and data practices. However, several respondents did highlight the significance of the localised dimension in any consideration of the proposal, particularly around how local knowledge and expertise, along with understanding of resources, would sit within or alongside a national approach. A number of respondents did feel that further scoping and exploration needed to be carried out before any decision around a national approach was implemented.

6.1.1 National placement mechanism

A national placement mechanism could co-ordinate secure care placement referrals, and provide a more robust oversight and monitoring, similar to, or a mixture of, the following comparative models in the rest of the UK:

Model

a) England’s Secure Welfare Co-ordination Unit

• Central point of contact for all local authorities looking to place children in secure accommodation on a welfare basis in England and Wales.
• Referrals are made available to all homes where a secure place is available. Each home will then indicate whether they can accept the child.
• No role in placement decisions.
• Ability to collate data/trends which supports data modelling and forecasting capacity requirements.
• Ability to report on complexity of children being referred to ensure appropriate supports are in place – sustaining/supporting placements.

Model

b) Northern Ireland’s model

Features

• National function with central oversight of placements and planning.
• Operates a Multi-Agency Panel – including professionals from across health and social care, health boards, education and justice - which makes decisions about admission to secure accommodation, encourages the use of alternatives, determines which specific location best meets the needs of the child and monitors data to support planning.
• Independent advocates are involved which ensures decisions are child-centred and participatory.

As well as providing a more robust oversight and monitoring service, a national placement mechanism could address some long-standing issues relating to data, regional disparities, co-ordination and resource efficiency.

6.1.2 The National Social Work Agency

The National Social Work Agency (NSWA) will launch in spring 2026, leading excellence and driving positive change across the social work profession in Scotland.

Including a national secure care placement coordination role within the NSWA’s remit presents a strategic opportunity to improve the effectiveness, fairness and accountability of secure care access across the country.

A phased approach could allow defined elements of the function to be explored and assessed within the NSWA while further engagement and takes place to determine whether statutory powers are required. Additional scoping will be needed to define the remit, identify resource requirements and costs, and shape how the function will operate.

Questions on national co-ordination of secure care placements

Q19) How can we improve access to secure accommodation placements to ensure that children who cannot legally be placed elsewhere (e.g. those remanded or sentenced by the courts) are always accommodated appropriately?

Please explain the reasons for your answer.

Q20) Do you agree there should be nationally-funded facilities whereby there is guaranteed access to fulfil court orders and do you think that would be sufficient to build confidence in decision makers?

Yes

No

Please explain the reasons for your answer.

Q21) Do you agree Scotland should introduce a single national system for co-ordinating secure care placements for children?

Yes

No

• If yes, what functions should that system include?
• Would these differ depending on the route through which a child enters secure care? If so, how?
• If no, what alternative approach would you suggest?

Q22) When creating a new national system to coordinate secure care placements for children, which type of model do you think Scotland should look at and take ideas from?

Please explain the reasons for your answer.

Q23) Beyond the specific models referenced in this section, please share any other proposals or comments you have in relation to national co-ordination.

Please explain the reasons for your answer.

National co-ordination and secure placement allocation

Northern Ireland operates a Multi-Agency Panel – including professionals from across health and social care, health boards, education and justice - which makes decisions about each child’s admission to secure accommodation.

Q24) If Scotland were to establish a Multi-Agency Panel to make decisions about secure care placements, similar to Northern Ireland’s model, which professionals do you think should be part of that panel? Do you also think that care experience should be represented on the panel?

Please explain the reasons for your answer.

6.2 Secure care funding reform

Secure care in Scotland is a locally commissioned service, supporting a very small number of children with complex needs. The interaction between demand and supply of secure care has consistently been recognised as a complex and shifting landscape. A spot purchase model currently operates, whereby local authorities and the Scottish Government directly approach the approved and registered secure providers in order to access secure care placements. The four secure providers subscribe to a national framework contract managed by Scotland Excel.

The Scotland Excel contract does not prohibit, provide for, or offer clarity on cross-border placements – which remain bilateral private commercial arrangements between individual providers and the placing authorities from elsewhere in the UK.

Since 2011, the current contract has played a supportive role in standardising expectations and placement processes across Scotland’s independent secure care centres, as well as bringing transparency and consistency to placement costs. However, successive strategic reviews, the experience of providers and purchasers, the observations of parliamentary inquiries and The Promise, all raise fundamental questions about whether the existing contractual frameworks continue to meet Scotland’s needs.

Challenges identified include:

• Financial instability due to variable occupancy levels posing challenges to the sustainability of the charities operating the centres;
• Spot purchase arrangements mean costs vary from year to year, depending on the number and complexity of placements. Demand-driven arrangements make it difficult to plan capacity;
• Inconsistent access and affordability for placing authorities;
• Difficulties in workforce recruitment, development, retention and investment;
• Complex commissioning arrangements;
• Limited flexibility for innovation by individual providers or to explore and adopt new models of care.

6.2.1 Nationalisation

The Scottish Government has committed to ensuring that secure care is sustainable and equitable. There is growing interest in whether alternative funding approaches – including nationalisation of funding – could better reflect secure care’s role as a national resource.

The 2026 COSLA manifesto calls for the nationalisation of the provision of secure care:

“Nationalising the provision of high-quality secure care for children. The current model relying on four independent providers is precarious, and availability of places is unreliable. Creating a national approach should also incorporate the Child and Adolescent Mental Health Services (CAMHS) inpatient and secure mental health provision.”

Nationalising secure care could involve creating a single national service, taking over existing services and staff and buying out current providers. This would shift a lot of responsibility to the national level and would require major public investment. It would also represent fundamental change in identity for the future provision of secure care.

Nationalisation could potentially:

• Provide greater financial stability for secure care providers.
• Support consistent availability of secure care beds across Scotland.
• Enable more strategic planning of capacity, workforce and specialist services.
• Better align funding with the Secure Care Pathway and Standards, including expectations around transitions.
• Improve coordination across health, education, and social work support.

It is important to note that the National Child Inpatient Unit (IPU) and the National Secure Adolescent Inpatient Service, Foxgrove, are both already national services, provided in the NHS and commissioned by National Services Scotland (NSS). The Adolescent IPUs are regionally provided, with flexibility to admit young people from other areas in Scotland. These are provided under the terms of the Mental Health Act and their principles require care to be provided in the least restrictive environment and where the care required cannot be provided in any other way than an IPU.

At the same time, any move towards nationalisation would require careful consideration of governance, accountability, funding, resources – including how funding models interact with efforts to strengthen alternatives to secure care to ensure it remains a last resort.

This consultation therefore seeks views on how secure care should be funded in the future, including whether changes to the current funding model – up to and including national funding – could better support children and ensure sustainability of the provision of secure care.

Questions on the nationalisation of secure care

Q25) Do you support the concept of the wholesale nationalisation of secure care provision in Scotland so it is run as a national service in the future?

Yes

No

Please explain the reasons for your answer.

6.2.2 Potential funding models

We have outlined several potential options that would require further exploration to assess their viability, cost, resource implications and broader legal, operational and strategic implications. These are not exhaustive, and the consultation therefore seeks views on any additional models that could offer long‑term sustainability.

Option 1: National approach to funding secure care

Under this option, funding responsibility for secure care could transfer from individual local authorities to Scottish Government (or a national body acting on its behalf). Secure care could be funded as a national service, with secure placements commissioned or funded centrally. Consideration would need to be given to costs and how this would impact local and national government budgets.

Potential benefits:

• Increased financial stability and sustainability – a national funding model could provide more predictable and stable funding for secure providers, supporting long-term planning, workforce retention and service quality, reducing reliance on fluctuating occupancy levels.
• Equity of access across Scotland – nationalisation could reduce variance between local authorities, ensuring decisions about secure care are driven by need.
• Strategic capacity and workforce planning – central oversight could enable better alignment between demand, capacity, alternatives and workforce development at a national level.
• Clear recognition of secure care as a national resource – national funding would require secure care to be available, regardless of where a child lives, and that no single local authority can plan for this alone.

Potential challenges:

• Potential loss of flexibility and autonomy for secure providers and local authorities.
• Complex governance and accountability – nationalisation would require clear arrangements for decision-making, oversight, and accountability, including the role of local authorities and the Children’s Hearings System
• Transition and implementation – moving to a national model would involve significant legal, financial and operational change

Option 2: National commissioning with local placement responsibility

Under this model, secure care could be commissioned nationally, but funding would continue to be authorised and managed by local authorities.

Potential benefits:

• Greater consistency in costs, contracts and expectations – national commissioning could reduce variation in fees and contract terms.
• Improved sustainability for providers without fully removing local decision-making.
• Ability to embed national quality requirements through contracts.

Potential challenges:

• While more potentially more stable that the current model, secure providers may still experience financial uncertainty if demand fluctuates significantly.
• Requires strong co-ordination between national commissioners and local children’s services

Option 3: Hybrid funding model

Under a hybrid approach, the Scottish Government could provide a proportionate level of block funding to secure care providers (e.g. a certain amount of beds) with local authorities contributing variable costs linked to individual placements.

Guaranteed annual budgets for secure care providers, could be based on planned capacity and delivery expectations. This could mean the Scottish Government commits to fund all of, or a defined minimum number of, secure beds, and local authorities pay the actual costs based on presenting placement demand.

The Scottish Government maintained a commitment to pay for up to 16 beds (4 in each secure centre in Scotland) to maintain capacity and provide a level of financial security to secure providers. This option could effectively build on that commitment.

Potential benefits:

• Improves secure provider stability while maintaining local accountability.
• Reduces cost volatility.
• Supports capacity restoration even during periods of low occupancy.

Potential challenges:

• Dual funding may increase reporting and financial management requirements.
• May not fully address fundamental sustainability and equity issues.
• Limited scope for long-term strategic planning.

Option 4: Retention of current model with targeted reforms

This option would retain local authority-led funding – meaning local authorities retain full responsibility for funding decisions within their current legal responsibilities - but would introduce reforms, such as:

• Standardised national costs with extended contract durations, improved mechanisms for up-rating agreed annual fee increases.
• Agreed provision, either within the negotiated bed rate, or on a free-standing basis, full provision for the agreed capital maintenance or fundamental modernisation of each campus within the overall secure estate.
• Incremental improvements with limited disruption.
• Enhanced national oversight and data transparency.

Potential challenges:

• May not address fundamental sustainability and equity issues.
• Challenges of volatility and workforce instability may persist.
• Limited scope for long-term strategic planning.

Conducting a comprehensive assessment of all possible options - and implementing new, contracting arrangements - will be essential to shaping our medium to long-term approach. That is why we are seeking initial feedback through this consultation to help inform further research and analysis needed to fully understand the legal, financial, and resource implications of potential options.

Questions on potential secure care funding reform

Q26) In the short-medium term, do you agree Scotland should move away from ‘spot purchasing’ by local authorities or the Scottish Government as the main way secure placements are funded and services are supported to remain sustainable and supported to plan for improvements and modernisation?

Yes

No

Please explain the reasons for your answer.

Q27) Which funding model (or combination of models) would best support the sustainability and equitable use of secure care in Scotland, and why?

See section 6.2.2 above which sets out a number of potential options (not exhaustive), including:

• Option 1: National approach to funding secure care
• Option 2: National commissioning with local placement responsibility
• Option 3: Hybrid funding model
• Option 4: Retention of current model with targeted reforms
• Option 5: Other

Please explain the reasons for your answer.

Q28) How can Scotland make sure that any new approach – whether national, local or mixed – guarantees equity of access for all children?

Please explain the reason for your answer.

6.3 Phased implementation

We understand the importance of a phased implementation approach and meaningful stakeholder engagement to ensure that any changes identified through the consultation are effective, sustainable, and appropriate. To achieve this, we will develop a clear plan for delivering change incrementally, carefully managing system impacts and ensuring workforce readiness at each stage. While some systemic reforms may take years to fully implement, they will be guided by a structured plan designed to maintain progress and momentum. Co-design will remain at the heart of any change.

Depending on the outcomes of this consultation, the Scottish Government envisages a phased approach to any major change in funding and commissioning could include, for example:

1. Short term (1-2 years)

• Strengthen the existing Scotland Excel contract framework, while identifying the timescale for any successor arrangements as soon as possible.
• Improve national co-ordination and data collection on demand, costs and outcomes.
• Maintain core funding to ensure provider and system sustainability.
• Explore whether further diversification is needed among providers to promote specialism and flexibility.
• Produce a detailed implementation plan for national commissioning or delivery.

2. Medium term (3-5 years)

• Establish a national commissioning function.
• Begin phased introduction of new funding models.

3. Long term (10 years)

• Transition to a national delivery model for secure care.