Private companies running children’s homes are charging cash-strapped councils as much as £22,000 a week per child, it was claimed yesterday.
The staggering cost was revealed by Sharon Cooper, head of services for children in care at Warrington Council in Cheshire.
She said on BBC Radio 4’s Today programme: ‘When you’re faced with the prospect at five in the evening where you can’t find a home for a child who needs to come into our care unfortunately, you’re between a rock and a hard place.’
The bill for children in a care home is typically £3,800 a week – or £197,600 annually – according to the County Councils Network.
The Competition and Markets Authority highlighted the risk posed to children’s care services by private equity firms, which run six of the ten largest children’s home providers and the two largest foster care (file photo)
But Warrington Council’s chief executive, Professor Steven Broomhead, said: ‘We were recently quoted £22,000.
This is rare, but is no longer unheard of with external placements, especially when trying to place children with particularly complex needs.
‘On average, we are paying around £4,500 per week, with the current highest cost being just over £10,000.’
Yesterday, there were further concerns the number of children in care homes could rise by 36 per cent to 95,000 by 2025 putting ‘unprecedented pressure’ on local council budgets.
Last month, the Competition and Markets Authority highlighted the risk posed to children’s care services by private equity firms, which run six of the ten largest children’s home providers and the two largest foster care companies.
Private equity has been widely criticised for a culture of excessive debt and asset stripping while reaping huge profits and dividends.
The CMA said high debt levels leave firms vulnerable to going bust if credit conditions tighten ‘with potentially serious negative impacts on children and the ability of local authorities to fulfil their statutory duties’.
Department for Education figures show numbers of children entering and leaving care in 2020/21 fell to their lowest levels in nine years.
There were 28,440 new arrivals, down 8 per cent year-on-year, and those leaving fell 6 per cent to 28,010.
But the year was impacted by coronavirus and the number of looked-after children still reached a record high of 80,850.
Projections for the County Councils Network estimate that it could reach 95,000 in just over three years’ time.
The amount spent by councils on children in care could rise from £3.8bn in 2015 to an ‘unprecedented’ £7.4bn in 2025, the network said.
Private companies running children’s homes are charging cash-strapped councils as much as £22,000 a week per child
Keith Glazier, the CCN’s lead for children and Conservative leader of East Sussex County Council, said that as council budgets are swallowed on soaring care home costs, councils ‘aren’t having the ability to go out and do more early intervention with families, to try and keep families together, rather than having to take children into care’.
He added: ‘At the end of the day we have to ensure children are safe, that is the prime purpose’.
Speaking at the CCN conference in Marlow, Bucks, yesterday, the CCN’s chairman Tim Oliver said: ‘The reality is that there are too many vulnerable children being placed in expensive residential care settings and staying in the care system for longer.
‘With the situation becoming unsustainable, we need additional funding and an unrelenting focus on preventing family breakdown and keeping families together, alongside systemic reform of how councils work with their public sector partners to achieve these aims.’
A Department for Education spokesman said: ‘We recognise the challenges that councils are facing, including the pressure on children’s services, which is why we are providing local authorities councils with £4.8bn in new grant funding to help maintain vital frontline services, including children’s social care.’
