The Officer Key Decision meeting on Tuesday 22 September 2026 considered proposals for the development of two new children's homes in Newham. These homes are intended to provide residential care for children with complex mental health needs and those at risk of deprivation of liberty orders.

Support for Children with Complex Mental Health Needs - Proposal for New Residential Homes

Proposals were presented for the Corporate Director of Children and Young People's Services, Laura Eden, to approve the development of two new children's homes in Newham. This would follow a recommendation to utilise £2.032m from the Council's Capital Programme allocation to Children's Services for the refurbishment of two existing council properties, Property 1 and Property 2. The project aims to address a critical shortage of local residential provision for children in care with complex needs, including those experiencing mental health difficulties, self-harm, and those at risk of exploitation.

The Department for Education (DFE) has awarded Newham Council a grant of £1.680m, which will cover approximately 45% of the refurbishment costs. The Council would fund the remaining capital costs, totalling £2.032m, from its existing capital allocation for children's services. The two properties, both owned by the council, would be refurbished to provide a total of eight bedrooms across the two homes. Property 1, previously used as supported accommodation, would be refurbished to provide four bedrooms. Property 2, formerly a day centre for older people, would also be converted to provide four bedrooms, requiring a full planning application for change of use.

The new homes would be operated by Newham Council and registered with Ofsted under the Care Standards Act 2000 and the Children's Homes (England) Regulation 2015. This initiative aligns with the Council's Newham Living strategy, which focuses on utilising existing council buildings to establish innovative services. The development is also part of the Newham Children in Care Sufficiency Strategy, aiming to increase local residential provision and reduce the number of young people placed outside the borough.

The report highlighted that the Council currently relies on the market for residential placements, incurring significant costs. In the financial year 2024/25, the spend on residential placements was £14.600m, rising to £15.400m in 2025-26. The new in-house provision is expected to offer more tailored care, improve stability for children by minimising placement moves, and ultimately reduce costs through a reduction in commissioned placements. The financial modelling suggests a positive net present value and a breakeven position is anticipated by 2029/30.

The decision was to be made in consultation with Councillor Lakmini Shah, Cabinet Member for Children, Education and Community Services, and other relevant officers, including the Assistant Director of Procurement, Head of Legal Services, and Director of Finance (Deputy Section 151 Officer). The report noted that Appendix 1, containing financial details, was exempt from public disclosure due to containing commercially sensitive information. The proposed homes are expected to be operational by June 2028 for Property 1 and October 2028 for Property 2, following refurbishment and Ofsted registration.

The report also considered alternative options, including doing nothing, using the buildings for other service areas, or disposing of them. These alternatives were rejected as they would not address the need for local children's homes, leverage the available grant funding, or reduce current placement costs. The project is also mindful of climate emergency implications, with designs to be guided by Newham's Just Transition Plan.

The proposal was for the Corporate Director of Children and Young People's Services, Laura Eden, to authorise the utilisation of £2.032m from the Council's Capital Programme, the procurement and award of works contracts for the refurbishment of both properties, and to note that the homes would be operated by Newham Council and registered with Ofsted.