DESCRIPTION
Wales is moving children's residential, secure accommodation and fostering services towards a not-for-profit model. This update explains the changes already in force and the next planned stages.
When
Updated 28 October 2026
Who
Paula Martinez
The Health and Social Care (Wales) Act 2025 became law on 24 March 2025. Its reforms cover children's home services, secure accommodation and fostering services, described as restricted children's services. Implementation is phased: some restrictions are already in force, while further changes are planned for 2027 and 2030.
The Welsh Government's stated aim is to keep public funding within children's care, with surpluses reinvested in services and support. The move is towards local-authority provision and permitted not-for-profit organisations. It does not mean that every existing for-profit service has already closed or stopped caring for children.
Already in force — 1 April 2026: new for-profit providers cannot register restricted children's services with Care Inspectorate Wales (CIW). Existing for-profit providers cannot vary their registration to add another restricted children's service or place. CIW also provides a change-of-legal-entity process for existing providers seeking to re-establish under an approved not-for-profit model.
Next planned stage — 1 April 2027: the published implementation timetable provides for restrictions on increasing existing for-profit capacity, including additional children's-home beds and approval of new foster carers. The Welsh Government consulted on the detailed arrangements in 2026. Providers should check the final regulations and current CIW guidance when planning changes.
Further planned restrictions — 1 April 2030: CIW's timetable describes limits on new placements with existing for-profit services. Placements by English local authorities would be restricted to exceptional circumstances set out in regulations; Welsh local authorities would need Welsh Ministers' agreement through the supplementary placement process. These later stages should not be confused with a blanket ban already in force.
For care teams, continuity for children is central to planning any transition. Review the latest guidance with commissioners and CIW, check how the rules apply to your service and communicate proposed changes clearly with children, families and staff. The sources below distinguish current requirements from future implementation plans.
The Welsh Government's stated aim is to keep public funding within children's care, with surpluses reinvested in services and support. The move is towards local-authority provision and permitted not-for-profit organisations. It does not mean that every existing for-profit service has already closed or stopped caring for children.
Already in force — 1 April 2026: new for-profit providers cannot register restricted children's services with Care Inspectorate Wales (CIW). Existing for-profit providers cannot vary their registration to add another restricted children's service or place. CIW also provides a change-of-legal-entity process for existing providers seeking to re-establish under an approved not-for-profit model.
Next planned stage — 1 April 2027: the published implementation timetable provides for restrictions on increasing existing for-profit capacity, including additional children's-home beds and approval of new foster carers. The Welsh Government consulted on the detailed arrangements in 2026. Providers should check the final regulations and current CIW guidance when planning changes.
Further planned restrictions — 1 April 2030: CIW's timetable describes limits on new placements with existing for-profit services. Placements by English local authorities would be restricted to exceptional circumstances set out in regulations; Welsh local authorities would need Welsh Ministers' agreement through the supplementary placement process. These later stages should not be confused with a blanket ban already in force.
For care teams, continuity for children is central to planning any transition. Review the latest guidance with commissioners and CIW, check how the rules apply to your service and communicate proposed changes clearly with children, families and staff. The sources below distinguish current requirements from future implementation plans.
Sources and further reading
Reviewed and updated 28 October 2026.
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