Premier Dalton McGuinty says he wants to work with Children's Aid Societies to understand how to fix their funding problems.
McGuinty's overture comes a day after 11 agencies went to court to ask for more money from the province.
The societies have been facing a $67 million deficit and say they need more funding to avoid staff reductions and cuts to core services.
They are asking a court in London, Ont., to review the funding decisions made by the Ministry of Children and Youth Services.
The 11 Children's Aid Societies involved in the case allege the government review process was biased and the outcome predetermined.
On Wednesday, the premier acknowledged there is a "real issue" when it comes to funding the agencies, and questioned why these challenges persist despite increased funding and a drop in the number of children in care.
The Ministry of Children and Youth Services is looking into the problem, he says, and has asked for advice on how to resolve it.
But, McGuinty adds, he's not sure both sides will agree on the answer.
Jeanette Lewis of the Association of Children's Aid Societies says the agencies didn't make the decision to ask for the judicial review lightly, but says it's needed to ensure proper care.
It's true that fewer kids fall under the care of CAS, she says, but that's because they are increasingly being placed with relatives — an arrangement that still requires funding.
The province has already appointed a commission to study the workings of the Children's Aid system.
It has also supplied interim funding and promised to work on a long-term plan to address the crisis.
The 11 agencies seeking the court review are in Brant, Chatham-Kent, Durham, St. Thomas and Elgin, Kingston, Haldimand and Norfolk, Huron Perth, Oxford County, Timiskaming, Nipissing and Parry Sound and Timmins.