The problem here is that it all depends on exactly what basis the boy has been placed with relatives. Social Services have a liking for these kind of placements which they call "Family Care" which doesn't really exist in law. Needless to say they do not pay allowances as it is a family arrangement. They can however pay out of S.17 budget for children in need.
Social services should have assessed whether this boy needs to be removed from his parents, and if so would they need the consent of the parents, and if that was not forthcoming and they believed that he was at risk of significant harm. They appear to have decided on the one hand that he should be removed, hence asking if nan could have him. On the other hand they say he can go home, seemingly to be further ill treated.
My guess is that they are waiting for him to be 16, when they won't really have any responsibility for him. In law children are minors until they are 18 but in social services I'm afraid they see it as 16. Their only duty then would be to "advise and assist" him and this can mean giving him addresses of hostels or lodging houses, private rents etc. If he is homeless they should provide the deposit for private rents and the first months rent, which is required by the landlords. From thereon he would have to claim Housing Benefit to get help with the rent. Connexions is a good place for young people to get advice and support but this damn govt is closing them all down, slashing all public service budgets, leaving children and vulnerable young people at serious risk of harm.
I can only suggest that your friend's nan contacts the social services and ask for payment for caring for the boy. If they refuse, ask them for a copy of their complaints procedure (this usually tells them that you mean business) and follow it through. The other way is to complain to your local MP - who will pass your complaint through to the chair of the Social Services Committee, who in turn passes it through to the Director and it eventually gets passed down to the relevant team manager. I can tell you from experience that when this happens, team managers jump, because the director is asking for an immediate response, because he/she has to get back to the Chair of the Social Servies Committee (who are really the employers of the Social Services Dept.
It would look good on the front of the local paper wouldn't it "OAP asked to care for 15 year old boy and Social Services won't pay her a penny"
It depends how far you want to push it and how close this boy is to 16. The one problem is that SSD have said the boy can go home, so it could look like your friend's nan is choosing to care for him.
Kinship carers have to be approved as foster carers for their relative and then they are paid a mandatory allowance for day to day expenses (rates vary between LAs) but kinship carers don't often get paid a fee, which is payable to carers looking after non relatives. There is no way the LA are going to assess your friend's nan to be approved as a carer, given that the boy is 15 and more importantly because they are saying he can go home.
They can't have it both ways can they 1) Will his nan have him
2) He can go home???
I'd want their response to this contradiction.