Fallout leaves taxpayer with bill of ‘£17bn’

Dealing with the fallout from social problems affecting young people costs the taxpayer almost £17bn a year, according to research.

Problems caused by young people cost the taxpayer £17 billion a year
Problems caused by young people cost the taxpayer £17 billion a year

It suggests cash is being pumped into resolving issues such as mental health, going into care, youth crime and unemployment when it could be better spent addressing root causes.

The study, by the Early Intervention Foundation (EIF) charity, says a move to early spending will save public cash by reducing pressure on health services and the welfare system and “transform children’s lives.”

The analysis shows this £17bn “late intervention” bill is shared by a number of different agencies, including councils, the NHS, schools, welfare, police and the criminal justice system. Local authorities bear the largest share of the cost at £6.5bn.

The overall bill is the immediate cost for a single year and does not capture the long-term impact. Late intervention is not only expensive, it is hard to argue it is money well spent, the researchers said.

“What these figures represent is merely the immediate impact on the taxpayer of thousands of lives blighted by thwarted potential and missed opportunities,” the study warns. “The human and social costs are far greater.”

It argues not all of this cost can be prevented, as going into care or getting treatment for mental health issues is the best option for some youngsters. But the study adds: “Many of these children and young people might have had a different journey if they or their family had received the right help at an earlier time.”

It suggests there needs to be better co-ordination across Whitehall, local agencies and communities to ensure that existing early intervention funding is better spent.

Carey Oppenheim, EIF chief executive said: “Our research lays bare how much the Government spends each year tackling the social problems that early intervention is designed to prevent. Yet our public services remain increasingly geared towards picking up the pieces from the harmful and costly consequences of failure.”

Sir Tony Hawkhead, chief executive of Action for Children, said: “This research puts a hard figure on the cost of waiting too long to help children and young people.”

David Simmonds, chairman of the Local Government Association’s children and young people board, said: “Councils recognise that investing in early intervention improves the life chances of young people and results in cost savings to the public purse later on.

“The trouble is that funding streams based on departmental silos mean that too often the savings from investment by one agency are recouped by another, resulting in disincentives to invest in early intervention.”