Children and Young People Minister Mick Gentleman announced the new funding on Wednesday, part of a $16 million boost to out of home care for vulnerable children and their families in the ACT.

Funding by government and fund raising efforts, Karinya House is the Canberra region's only residential outreach service providing accommodation and support services to pregnant women and mothers as well as their families during times of crisis.

Mr Gentleman said the immediate funding would see a near doubling of Karinya House capacity and services, to provide 24-hour supervised support for up to three months for mothers whose babies are at risk of entering care.

Already the facility has supported more than 4000 mothers and babies since it was established in 1997.

"We are also investing in initiatives run by the non-government sector at the front of the care system, including placement prevention services that will provide intensive, in-home, practical support to children whose families are at high-risk of entering the statutory care system," Mr Gentleman said.

"This strategy also focuses on getting children and young people home safely as quickly as possible following entry to care, so a dedicated reunification service will be established."

The government's out of home care strategy was launched last week and will be progressively rolled out over five years, beginning in January 2016.

Karinya House director Marie-Louise Corkhill said the major expansion and consolidation was welcome news for the facility and its clients.

"We've had a long-term and very good relationship with care and protection services and the community services directorate and we are really formalising that with our care of mothers and babies, particularly those at risk.

"Half our budget every year is made up of fundraising and donations so it is very important to have very strong government backing as well as community partnerships," Ms Corkhill said.

Funding for the new Step Up for Our Kids strategy comes on top of annual ACT government budget allocations of about $31 million.

Designed to break intergenerational disadvantage, the broader plan will see non-profit agencies take over some government co-ordination of children living in care and will prioritise providing children with one foster family throughout their childhood years.

The strategy aims to better support birth parents and return children to their families as soon as possible or seek to finalise secure and permanent foster care or adoption options where a return cannot be achieved.

Part of the strategy is to provide more autonomy for non-government agencies working in the child protection sector.