The analysis by the Department of Communities and Local Government (DCLG) includes detailed calculations from 20 local authorities, and estimates that councils could save “billions”, by changing the way they intervene with the most challenging families.
It reveals that Barnet council was spending an average £100,000 every year on responding to each of its families with complex needs, before starting work on the troubled families programme, while Solihull council was spending up to 18 per cent of its overall budget on just three per cent of its families.
One single-parent family in the South West was estimated to have cost local agencies more than £400,000, including one family member costing the public purse more than £290,000 in a single year.
But the report claims that professionals were able to turn this family around, as a result of an “effective whole family intervention”, at an estimated cost of just £8,250.
The report includes calculations as to how much individual council areas hope to save from their work with troubled families. In Leicestershire, the council is projecting average savings of around £25,700 per troubled family, in West Cheshire the figure is £20,000 and in Manchester the figure runs to £32,600.
Manchester estimates that it will make an overall saving of £224m from spending £138m more effectively on 8,000 troubled families.
Communities secretary Eric Pickles said: “The prize here is potentially huge, both in terms of reducing the financial cost on the public purse and the human costs on families and communities.
“The savings we can make for the taxpayer would far outweigh the extra money we are putting in. Momentum is building behind this work and we will do much more in 2013.
“We will start showing the communities around these families that things are changing for the better, with kids back in school, crime coming down and parents sorting out their problems and getting back towards work. And we will do all this in bigger numbers than ever before.”
The government has estimated that nationally, 120,000 troubled families cost the taxpayer a combined £9bn each year.
Ministers have pledged funding of £448m from six government departments over three years to incentivise local authorities to turn around the lives of these families by 2015. Local authorities will be paid up to £4,000 per family on a payment-by-results basis.
Ken Meeson, leader of Solihull Council, which contributed to the report, said: “It is vitally important that councils get to grips with making an impact with troubled families in their area and tackle the drain they make on public services.
“It is only fair on other families and all council taxpayers that we bring these costs down and free up vital resources for more effective spending. In Solihull we are doing exactly that.”