Pocket Money and Bank Accounts for Looked After Children

The purpose of this policy is to ensure that all Looked After Children and Young People have the opportunity to develop financial skills in learning how to manage their money, develop good saving habits and have access to their own bank account, prior to them seeking part or full time employment.

It is important that children and young people know the value of money and are given opportunities to develop knowledge and values in this area. Carers should discuss pocket money and good money management skills with children and young people as part of them developing independence in an age appropriate way, according to their age, development and maturity.

The amount of pocket money children and young people are awarded is already set out in the Payment Policy for children in foster placements. It would be considered sensible that children under the age of 1 year old would not receive pocket money and that toys or books are to be purchased, which would move on with the child to any future permanent or adoptive home. Any of the money not spent can be saved in an accessible bank account or "piggy" bank. An older child or young person may receive their pocket money for sweets, magazines or put towards a particular computer game, holiday treats or a birthday present, to help them develop their budgeting skills. 

Mobile phone contracts must be considered separately to pocket money, as this is included in the child allowance that is paid to foster carers. Similarly children in Residential Care may have separate arrangements for their phone cover. 

The amount to be given in pocket money should be discussed and agreed as part of the Placement Agreement with Delegated Authority meeting/plan. Arrangements should be reviewed by social workers, in line with the child's/young person's Care Plan and by the fostering supervising social worker as part of formal supervision.

Pocket money should not be used as a behaviour management tool. However, in certain situations it can be used to contribute to the repair or replacement of an item deliberately damaged. This should only happen in the context of a restorative approach that the child or young person has taken part in and a maximum of 50% of their pocket money can be used. Before this approach is used, agreement must be provided by the child's social worker and supervising social worker to consider any implications. Parents should also be consulted and if the child is looked after under a voluntary agreement, parents must agree to any changes or unless this decision is delegated to foster carers.

Children and young people should not be required to buy their own personal care items out of their pocket money as the fostering allowances are expected to cover this.

Where young people are at college and receive a bursary fund or are working, consideration for pocket money should be given and expectations agreed and set in their Pathway Plan. It may be appropriate, with everyone's agreement that all pocket money will be paid into an accessible bank account and this should be discussed and recorded as part of a placement planning meeting or Pathway Plan.

Foster carers are expected to encourage young people to share in some household tasks at an age and developmentally appropriate level. For example, feeding a pet, keeping their bedroom clean and tidy. At other times, foster carers may encourage young people with rewards to have extra money paid for undertaking certain tasks. For example, cleaning the car or gardening. Pocket money and rewards are good tools to help children and young people to learn how to manage money from a young age.

For respite placements, the placement plan should specify any pocket money that the child or young person will bring with them to spend, during the respite placement or sleepover with the respite carer. The respite carer is not responsible for providing pocket money or providing monies to allow the child or young person to participate in clubs.

An accessible bank account should be set up in the child's name and the timeliness of this must be agreed by the child's social worker, supervising social worker and those with parental responsibility, where appropriate. When opening an account, the majority of banks and building societies require an adult to act as a sponsor. This cannot be a member of staff and can be a problem for foster carers in situations where children/young people move between placements as they would be responsible for transferring the savings account to another adult sponsor.

If the child is under the age of 16 years, they will need to be accompanied by the parent, foster carer or carer in order to apply. The child, parents and/or  carer will need to provide identification, with the support of the child's social worker, for example, the obtaining of the birth certificate or passport.

The child's social worker will also need to provide a letter to confirm the child/young person's address and the Assistant Director for Children and Families/ those with parental responsibility will need to sign the application forms.

Every bank or building society is different in terms of what they require. As such, it is important for the foster carer/guardian to make the necessary enquiries. Banks can also provide a private space for any appointments of this nature, so that any personal or sensitive information is not overheard.

If a child or young person has an existing bank account, the carer, adopter or parent/family (if reunified home) must ensure this is updated with their new address and contact information.

It is not the role of the respite carer or Hub Home Carer to open bank accounts for children or young people. This remains the role of the main carer.

Details regarding the child or young person's bank account should be discussed and recorded in their Placement Plan with Delegated Authority. The supervising social worker will review the bank account amount and management of this, along with any pocket money each 4-6 weeks, as part of their formal supervision. The child's social worker can also do the same at each statutory visit. In addition, sight of the bank account can be requested during unannounced visits.

Account summaries, including totals will be recorded on the child's electronic file, by the child's social worker. The supervising social worker will record such information in the carer(s) supervision notes.

Bank account monies and pocket money should also be discussed at each Looked After Review and in the foster carer's annual review report.

Staying Put Arrangements and Pathway Plans should include information about the young person's bank account and how they may choose to spend any savings, as they prepare for living independently.

Children and young people's access to their bank accounts should be discussed and agreed in the Placement Plan, as this will change as a child or young person becomes older and more independent.

Where a child or young person does not have direct access themselves, then the circumstances when  carers can make withdrawals should also be set out in the Placement Plan and should be discussed with the child's social worker and supervising social worker beforehand.

The foster carer must note any such withdrawals and its use within the fostering logs, which are specific to the child/young person.

If the child or young person move placements or moves onto independence, the carers name should be removed as the signatory and changed accordingly.