Children's mental health services are to be earmarked for extra cash in the government's forthcoming mental health strategy, Department of Health officials confirmed last week.

Tom Luce, head of the department's social care group, said extra money would be made available for child and adolescent mental health.

His disclosure came at a press briefing on the government's response to Sir William Utting's report on safeguarding children in care, published last week.

The response includes an extra£375m children's services grant for social services departments over the next three years.

Although none of this money will go directly to the NHS, Mr Luce said it could be used to fund joint initiatives between health and local government.

Health secretary Frank Dobson made clear the importance the government attaches to children's mental health when he gave details of his response to the Utting report in the Commons last week.

He said the forthcoming mental health strategy would address the special needs of all children, but he was particularly concerned about those in care.

'Recent research suggests two thirds of these children are suffering some degree of mental health problems, compared with 4 per cent of all other children of the same age,' he said.

He announced that the government is to set up a new criminal records agency so that employers can check on people seeking to work with children. This will pool existing lists held by DoH and the Department for Education and Employment.

The announcement of extra cash for children's mental health services comes soon after publication of the Partnership in Action white paper on joint working, which signalled new funding arrangements between health and social services. Where appropriate, a single agency could take the lead for a service, the paper says.

Although the government hopes the new mental health money will be used in similarly imaginative ways, pooling budgets will not be a prerequisite for this extra cash, a DoH spokesperson said.

A national survey of the mental health needs of all children and young people is being piloted by the DoH, and another on the needs of children in care is in the pipeline.

Local authorities working with health authorities will be expected to meet new targets for improving the health of children in care. The details were set out in the national priorities guidance for 1999-2002, issued on 30 September.

The government is particularly concerned that health authorities are failing to notify local authorities if a child is in hospital for longer than three months - a requirement under Section 85 of the Children Act.

The Government's response to the Children's Safeguards Review. From the Stationery Office.£14.50.