Revealed: top 10 children’s care providers made £300m profits
The 10 largest providers of children’s social care placements made more than £300m in profits last year, according to research that will fuel concerns over profiteering by private providers.
As pressure mounts within government, regulators, councils and fosterers over the provision of care for the country’s most vulnerable children, analysis seen by the Observer reveals the growing role of private equity companies in many of the biggest suppliers of care home and fostering places.
Profits among the top 20 providers of care home and fostering places now amount to 20% of their income. Despite the pandemic last year, their overall profits rose by more than 14% from 2020, according to the study commissioned by the Local Government Association (LGA).
The findings follow a series of warnings that marketisation of children’s social care is leading to some damaging outcomes. Several figures within the sector have reported children being placed far from their support networks where homes could be built more cheaply, or placed with families who lack the skills to provide the right care.
It comes months after a highly critical Competition and Markets Authority (CMA) warned that the UK had “sleepwalked” into a dysfunctional market for children’s social care, with councils struggling to pay for expensive places that often failed to meet the needs of the child.
An official review of children’s social care in England has been commissioned by the government and will report later this spring.
There are hopes that the review will back reforms in England as a result of a growing consensus around the issues within the current system. Councils have reported that spending on residential placements has increased by 84% since 2015, and that they are
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