LGA research on profit making and risk in independent...

Rachel Dickinson, ADCS President, said:

“This research, commissioned by the LGA, examines the changing nature of the children’s homes and independent fostering placements market for children in our care - though it’s important to note local authorities are the sole purchasers of placements.

“Children’s services have long operated in a mixed economy with private, voluntary, charitable and community providers involved in the delivery of services locally, but multi-million-pound mergers between providers are becoming commonplace and private equity is driving rapid changes in ownership, financial models and service delivery. There are significant challenges in regulating and monitoring providers of this scale and a lack of transparency regarding ownership. The report raises important issues worthy of further discussion and debate. In the context of rising placement costs, there are fewer providers dominating the market however these providers have significant debts and liabilities; there is now an unacceptable level of risk in the system.

“The excessive profits being made by some providers on the backs of vulnerable children is difficult to stomach, particularly when austerity continues to bite in local government. However, our overriding concern remains how the extraction of profit and the level of risk in the system might negatively impact on children’s outcomes.

“ADCS would welcome the opportunity to work with the Department for Education, Ofsted and others on the issues raised in this report. The government’s intention to undertake a review of the care system is a positive step forward but this issue needs immediate attention. We cannot wait for a situation where providers fall and vulnerable children suffer the consequences, the system must be driven by children’s needs, not maximising profits.”

ENDS

---

---