One in eight children in care in 2018/19  – some 12,800 young people in total  –   had to live in ‘unregulated accommodation’ that was neither inspected nor required to meet basic standards of care. In her report (The children who no-one knows what to do with), the Children’s Commissioner of England, Anne Longfield recorded that children recounted finding knives and class A drugs behind sofas, as well as being left alone after the accommodation was broken into, being intimidated by local gangs and assaulted by other residents. Others described the ‘disgusting’, ‘prison-like’ conditions of their accommodation including a damp bedroom with bugs in the carpet and one working, but mouldy, shower shared between 14 children and young people.

Just last month, a High Court judge wrote to the commissioner after suitable accommodation could not be found anywhere in England for an extremely vulnerable child, despite its finding that such a failure would endanger the child’s life. As a result, the High Court is often left with two options: to authorise the child’s placement in unregulated accommodation or refuse to do so, releasing the child back into the community, leaving them vulnerable to criminal and sexual exploitation. Longfield said: ‘These shocking cases used to be rare but are now routine, and I am worried the whole system is becoming immune to the devastating effect this is having on children who may have previously been abused and neglected, or have serious mental or physical health needs.’

‘The growing reliance on private providers, some of whom are making millions, is another symptom of a system failing to prioritise the needs of children,’ the commissioner continued. ‘Both the government and councils have failed in their responsibilities by leaving it to the market.’

In her report, the Children’s Commissioner revealed that the number of children in homes owned by private providers has increased by 42% from 2011 to 2019. It also found that the average profit margin for large providers on the fees they charge local authorities is around 17%; meaning almost £240 million was paid to private providers in profit in total in 2018/19. Seven out of the top 10 providers of children’s homes are owned by private equity funds and, according to the report, their debts and corporate structure raise concerns over the homes’ stability and the best interests of the vulnerable children.

While Ofsted ratings suggest that the quality of care in both local authorities and large private providers is generally good, the increase in private providers has rendered the system less transparent; now requiring complex investigation to uncover the ownership, profits, costs and accountability for the care provided.

Another report on the stability of children in care indicated that 6,500 children in care were moved between at least four separate homes over two years. The policy manager at the Children’s Society, Iryna Pona, said that the reports were ‘enormously worrying but not surprising’.

The Commissioner made the following recommendations:

• For councils to use their capital budgets to increase children’s home capacity.
• For the Government to launch the Care Review promised in its manifesto and set out a strategy which improves capacity, stability, quality and costs in residential care homes.
• Appoint a central body responsible for providing oversight; assessing local and national levels of need for current and future care.
• For the Department of Education or Ofsted to collect standardised and timely information on the prices across the care sector so that local authorities can compare prices to the quality of care provided across the country.

The Government has acknowledged that no child under 16 should be in unregulated accommodation and said its independent care review would be launched ‘as soon as possible’.