Some kinship carers such as grandparents and siblings are set to be paid an allowance matching foster carers but campaigners said a new overall strategy is lacking the scale, ambition and investment needed.

The Government has launched its first national Kinship Strategy for England, which it said will help shine a spotlight on extended family members who are keeping children out of care.

As part of the £20 million being invested to deliver the strategy, eight local authorities are expected to be selected early in the new year to be part of a pilot which will see kinship carers paid similarly to foster carers.

While lacking in the scale, ambition and investment needed, this National Kinship Care Strategy shows that the efforts made by kinship carer campaigners are paying off

The payments of £154-£270 per week, per child would be aimed at helping people avoid having to choose between becoming a carer and being able to afford to support their families, the Department for Education said.

The pilots will be funded with £16 million for the first year, and the Government has said it will run the pilot for at least four years.

The Kinship charity said it was “delighted to see the introduction of a multi-year pilot of financial allowances for some special guardians” but said its narrow reach would leave too many other kinship carers “wondering how they can continue to afford to keep providing a safe and loving home for their child”.

Dr Lucy Peake, the charity’s chief executive, welcomed the publication of the first national strategy on kinship care as “significant recognition” of a role she said had been “overlooked and undervalued for too long”.

But she added: “However, the investment and commitments in the strategy fall short of the ambitious and wholesale reform needed to establish a new kinship care system that delivers the urgent transformation that all kinship families need now and into the future.”

Kinship carers are often hidden in plain sight and today's strategy paves the way for them to be given the practical and financial support they deserve for the pivotal role they play in children's lives

While new guidance encouraging businesses to improve support for kinship carer employees was also welcomed, the charity accused the Government of “continuing to deny kinship carers a right to statutory paid leave” similar to people who adopt.

Dr Peake said: “Employers tell us they need Government to step up with statutory support to deliver the family-friendly policies which could make a difference, and the strategy was the opportunity to do that.”

The department said the strategy will see the role of Virtual School Heads – education champions within local authorities – expanded to cover kinship care.

Kinship said it welcomed this but argued the strategy “does not go far enough to guarantee the right educational and therapeutic support to all children in kinship care”.

The Government said there are more than 130,000 children living in kinship care arrangements in England.

The new strategy sets out a range of additional support for kinship carers, from new training and information so they have a better understanding of their rights, to high-quality peer support within local communities, the department said.

Dr Peake said: “While lacking in the scale, ambition and investment needed, this National Kinship Care Strategy shows that the efforts made by kinship carer campaigners are paying off.”

Children and families minister, David Johnston, said he was “very proud” that the Government had published the first ever strategy for kinship care.

He said: “Kinship carers are often hidden in plain sight and today’s strategy paves the way for them to be given the practical and financial support they deserve for the pivotal role they play in children’s lives.

“We are committed to reforming the whole children’s social care system to support families – right from the point they face challenges and need support, all the way to transforming the experience children have when in care.”

The Family Rights Group said the strategy’s publication “should be a cause for celebration”.

Cathy Ashley, its chief executive, said: “This is a moment Family Rights Group has been working towards, alongside families, for more than two decades. Thousands of relatives and friends step in to raise children every year, and many more could do so with the right support.

“The strategy provides an important opportunity to raise the profile of kinship care and it does make some welcome steps forward.

“However, we are concerned that the strategy falls victim to the same timid ambitions that are holding back the Government’s wider plans for children’s social care.”