The act of ‘profiteering’ care home providers who accommodate children in caravans and Airbnbs

Children’s homes will stop making “enormous profits” in an overhaul of the care system, the Government has announced.

New powers will be given to Ofsted watchdogs to crack down on private social care providers who deliver “sub-par standards of care at high cost to councils”.

Measures to be introduced in Parliament will also force companies providing care for children to adjust their finances to increase transparency in the sector, the Department for Education (DfE) has said.

A report by the children’s commissioner published on Monday found that vulnerable children were being made to live in caravans and Airbnbs, with many being placed in “inappropriate” accommodation.

The proposal is aimed at empowering social workers and others who work with children to take action against providers, the department said.

It said a long-standing challenge was that some private providers “suck money that should be aimed at vulnerable children, make too much profit or run unregistered homes that do not meet the correct standards of care”.

Local authority spending on looked after children has doubled in just ten years, from £3.1 billion in 2009-10 to £7 billion in 2022-23, the DfE said.

A ‘Backstop’ law is planned

The 15 largest private providers make an average of 23 percent of profits, according to an analysis by the Local Government Association, which says there are more than 1,500 children in placements each worth half a million pounds a year.

The government said it would also introduce “backstop” laws that would limit the profits companies can make if suppliers do not voluntarily stop profiteering.

Bridget Phillipson, the Education Secretary, said the system was “suffering from years of neglect”.

“It’s bankrupting the council, letting families down and, most importantly, leaving many children forgotten, helpless and invisible,” he said.

“We will crack down on care providers who make too much profit, tackle unregistered and unsafe providers and ensure early intervention to protect families and help children thrive.”

Ofsted will also be given powers to investigate multiple homes run by the same company, in response to recommendations made following abuses found at the Hesley Group of children’s homes.

The Child Safeguarding Practices Review Panel last year called for a more joined-up approach to the care of disabled children in care homes after its report into homes run by the Hesley Group.

The review focused on three residential settings – Fullerton House, Wilsic Hall and Wheatley House – registered as children’s homes and operated by the Hesley Group in Doncaster, between January 2018 and March 2021.

Young people ‘pay the price’

Looking at the experiences of 108 children and young adults, it found that some of society’s most vulnerable people had experienced “systematic and persistent” abuse and neglect for more than three years.

Dame Rachel de Souza, the children’s commissioner, said young children were “paying the price of a broken social care system” and “wearing things that no child should be wearing”.

He said the measures outlined in the bill were “an opportunity to overhaul how we treat young children in this country”.

A separate report by Dame Rachel found that some children’s basic rights to safety and happiness were “too often ignored in a system that puts profit above protection and allows decisions to be dictated by local resources”.

It said the autistic teenager was placed in an Airbnb by the local authority under supervision for nine months after being pressured to be discharged from hospital because he did not meet the criteria required under the Mental Health Act.

‘Not very suitable’

It also cites the example of a teenage girl who suffered abuse and parental neglect and who, after experiences in orphanages and children’s homes, was given a supervised crisis placement in a caravan.

He then lived in a children’s home 120 miles from his grandparents.

Dame Rachel said: “The vast majority of children subject to deprivation of liberty orders are in the care system.

“Some live in homes or special therapy settings for children that have been created specifically for them.

“However, many children are living with these restrictions in inappropriate places, including illegal children’s homes, Airbnbs or in hospital wards while waiting to be discharged.”

Her report recommended that “fewer” children should be deprived of liberty orders, and that for them, they should not be placed in unlawful children’s homes.

The Commissioner calls for the strengthening of the law in this area to provide clarity and transparency in decision-making; for children to have a strong voice in the process; and supervision by judges to ensure local authority decisions are reviewed every three months.

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