GOVERNMENT funding for local councils’ children’s services must be raised by more than £3 billion, a critical report by MPs has said.

The Housing, Communities and Local Government Committee said that it was clear that the current money available for children’s services was insufficient and needed to be increased significantly.

“We heard about a system at breaking point, increasingly reliant on the goodwill of social-care professionals,” the report states.

“The children supported by or in the care of councils are some of the most vulnerable in society and deserve better.”

The key recommendation made by the report, The Funding of Local Authorities Services, released last week, is that the spending review due later this year should increase central-government funding for local authorities, by £3.1 billion, until 2025.

Despite cutting back on non-statutory provision and focusing solely on child protection, most councils are still exceeding their stretched children’s social-care budgets.

“Financial restraint combined with seemingly ever-increasing demands on the sector is leading to what has been described as ‘a perfect storm’,” the report concludes.

The Government should also introduce a “day rate payment”, paid by the Home Office to local authorities who are looking after children with no recourse to public funds, equal to that paid for unaccompanied asylum-seeking children.

But, alongside an injection of fresh money, there also needs to be sweeping systemic change in the sector, the MPs on the committee argue.

The Government must begin a review to find out why demand for children’s social care has shot up in recent years, they say. The number of looked-after children has gone up from 59,400 in 2008 to 75,420 ten years later; a 27-per-cent increase.

The MPs also demand that the Government investigate why so many social workers are leaving the profession, and consider options to reduce their workloads by the end of 2019.

The huge disparity between the amounts spent by different councils on children’s services must also be looked into properly.

The chair of the committee, the Labour MP Clive Betts, said: “We have reached a crisis point and action is needed now.

“Over the last decade we have seen a steady increase in the number of children needing support, whilst at the same time funding has failed to keep up.

“It is clear that this approach cannot be sustained, and the Government must make serious financial and systemic changes to support local authorities in helping vulnerable children.”

The report has been welcomed by the Local Government Association, which revealed earlier this year that almost nine in ten councils overspent their children’s budgets in 2017-18.

Anntoinette Bramble, a Hackney councillor who chairs the Association’s children and young people board, said: “Children’s services are at a tipping point as a result of increasingly high levels of demand for support, and cuts in central-government funding.”

The Children’s Commissioner for England, Anne Longfield, also praised MPs’ intervention. She said: “We cannot just continue to cross our fingers and hope that vulnerable children will be all right, and this report must be a final wake-up call to the Government. This year’s spending review is the moment to act.”

A spokesperson for the Government said: “Every child deserves to grow up in a stable, loving family where they feel supported. That is why we’re putting an extra £410 million into social care this year, including children’s — alongside £84 million over the next five years to keep more children at home with their families safely, helping reduce the demand on services.”

The warnings over funding for children’s services came shortly before the All-Party Parliamentary Group on Knife Crime released its research, which suggests that councils that have cut youth work the most have tended to see an increase in knife crime.

The group of MPs and peers said that the four areas that had the steepest cuts in spending on young people also had some of the largest increases in stabbings.

The founder and chair of the group, Sarah Jones, who is the Labour MP for Croydon Central, said: “We cannot hope to turn around the knife-crime epidemic if we don’t invest in our young people.”

The connection between council cuts and crime is slightly speculative, however, as police-force areas tend to cover much larger areas than local authorities so the comparison is not like-for-like.