URL: https://sandwell.moderngov.co.uk/ieDecisionDetails.aspx?ID=1161

Decision Maker: Cabinet

Outcome:

Is Key Decision?: Yes

Is Callable In?: Yes

Purpose: The West Midlands Safe Centre (WMSC) aims to provide secure care for vulnerable young people with complex needs, offering trauma-informed and integrated health and education services.

Content: Approval was sought to progress the West Midlands Safe Centre project, including the proposed establishment of the most appropriate legal form of Special Purpose Vehicle (SPV) to enable the construction and operation of the West Midlands Safe Centre on behalf of the West Midlands local authorities for public sector delivery of secure children services. Once delivered the Safe Centre would be the first regionally owned secure children’s home in the country, providing 20 secure welfare beds and high-quality care, health and education to local children, saving local authorities, including Sandwell, from high-cost private care placements and reducing the use and cost of unregulated provision.   Reason for Decision Secure children’s homes were safe settings for children whose liberty was restricted, where they could be supported through trauma aware and psychologically informed integrated care, health and educational services. Secure children’s homes supported highly vulnerable young people with complex needs, providing care, health, and education in a safe environment where their liberty was restricted. These children often faced multiple placement breakdowns, missed education, unresolved emotional and physical health issues, and significant trauma.   There was a national shortage of secure placements for these vulnerable children, as highlighted by Ofsted, with 50 children waiting for a secure welfare placement on any given day. A total of 15 Sandwell children were placed in secure welfare during the period 2019–2025 with several other children in unregulated provision due to lack of availability of secure welfare. The West Midlands had no dedicated regional provision creating pressure on the existing secure estate.   The West Midlands Safe Centre would be the first regionally owned secure children’s home in the country, providing 20 secure welfare beds and high-quality care, health and education to local children, saving local authorities, including Sandwell, from high-cost private care placements and reducing the use and cost of unregulated provision.   Sandwell Children’s Trust was responsible for delivering children’s social care services and securing appropriate placements for the children we care for. Operating under the governance and oversight of Sandwell Council, the Trust worked in partnership with the local authority to ensure that vulnerable children and young people receive the support, protection, and care they need.   12 of the 14 West Midlands local authorities, (including Birmingham and Sandwell Children’s Trusts), were currently committed in principle to joining and authorities involved would be taking a formal decision to progress this provision through their governance process from September – December 2025.   The set up of the West Midlands Safe Centre was entirely funded by the Department for Education (DfE) who had recognised the national shortage of secure welfare beds and the lack of provision within the West Midlands region. The DfE capital funding of £61.8m for construction and “Seed Funding” revenue grant of up to £8.4m had been secured.   Alternative Options Considered Option 1 - Do nothing – This would not resolve the shortage of secure welfare care for the most vulnerable children in the West Midlands. Local authorities would continue to have to place vulnerable children at a significant distance from their local areas, away from their families and other networks. This option was therefore not recommended.   Option 2 - Proceed with the project and establish a structured SPV as a Company Limited by Guarantee (CLG) – Whilst this scored favourably in the options appraisal, tax advice identified a potential VAT and corporation tax liability with a CLG. Whilst a CLG could seek tax exemptions, there would be no guarantee of this and there would be a risk of delay in securing HMRC confirmations or approvals, which could affect operational timelines, especially if the CLG was to act as an SPV for public service delivery, so this option was not considered beneficial at the writing of this report and may need to be revisited and reported by to the West Midlands Safe Centre Project Board for consideration.   Resolved:-   (1)          that subject to the completion of the legal due diligence work, the development of the West Midlands Safe Centre as set out in the business case that has been submitted to the Department for Education is endorsed;   (2)          that the proposed legal formation of a Special Purpose Vehicle, subject to the completion of the legal due diligence work is endorsed:   (3)          that approval is given to the arrangements for the Council to join the Special Purpose Vehicle and be part of a formal partnership for governance of the West midlands Safe Centre with other West Midlands local authorities with a share proportion as set out in the report;   (4)          that further reports be submitted for Cabinet approval prior to any action continuing the Council’s participation in the Partnership Agreement at a revised share if insufficient local authority members sign up and the maximum Sandwell share of 8.83% is exceeded;   (5)          that approval is given in principle the proposed procurement approach and property arrangements for the operation of the West Midlands Safe Centre asset out in this report and supporting appendices;   (6)          that delegated authority is given to the Executive Director of Children and Education Services in conjunction with the Executive Director of Finance and Transformation (S.151 officer) and Service Director for Governance / Monitoring Officer (or their delegates), to undertake the following:   (a)          complete the necessary due diligence required including but not limited to legal and tax due diligence arrangements; and (b)          thereafter to complete all necessary documents to give effect to the above recommendations. The delegation shall also include the power to do anything necessary, incidental or ancillary for the carrying into effect the recommendations set out in this report.

Date of Decision: December 10, 2025