Council foster care placements in Bury are facing "significant pressures", a report has found.
The local authority says "too many children are being placed outside the borough in independent foster agency or residential placements", leading to "costly" spend against its budget.
A report, prepared ahead of a Children and Young People Scrutiny Committee meeting next week, also mentions the council wants to add at least 20 fostering households in the next financial year.
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It said: "Due to an increase in our CLA (children looked after) cohort, we have significant demand pressures upon placements and the availability of foster care placements within the borough.
"As a result, too many children are being placed outside the borough in independent foster agency or residential placements, which are costly and increases spend against the agency budget.
"When we look at trends via the Greater Manchester dashboard (a tool for sharing data across the authorities) we can see patterns of decline in enquiries and approvals from the start of the Covid pandemic.
"We have a clear need now to repair that impact and significantly increase the number of Bury approved foster carers and supported lodging hosts to increase the availability of homes within the borough, primarily to meet the needs of our children in care and care leavers, but also to use more cost-effective placements, rather than external high cost ‘specialist’ placements.
"We have a priority to increase the number of Bury approved fostering households by at least 20 in 2023/2024."
Due to rising costs, foster carers with the council are looking at the fees and allowances being offered by fostering agencies.
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The report added: "Maintenance allowances were uplifted by 2.3 per cent this year, backdated to the start of this financial year which carers report has had little impact on foster carers experiencing challenges with the cost of living crisis.
"Some Bury foster carers are reporting that they will be unable to continue fostering if professional fees and maintenance allowances are not uplifted.
"Some have told us they are making enquiries with independent fostering agencies where professional fees and maintenance allowances are higher than those being offered by Bury."
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But the council has put forward plans to "strengthen" its "current offer" of foster carers.
A council tax reduction offer and a short breaks offer are among the incentives being rolled out.
The council is also set to implement the "Mockingbird" model, which was originally developed by The Fostering Network and is being used by authorities across England.
The local authority said it will support "some of our more traumatised children and young people homes with highly skilled and experienced carers".
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