Children’s social care providers making ‘obscene profits’, says Baroness

Children’s social care providers are making “obscene profits”, while many looked after children are not receiving adequate care, a Labour frontbencher told Parliament.

Baroness Chapman of Darlington told peers that 43% of children’s services departments are currently rated inadequate or requiring improvement.

She said: “We’ve seen Sure Start centres closing, preventive services stripped away and young people abandoned in unregulated settings – some, heartbreakingly, in semi-independent homes miles away from their homes.

“At the same time, we see some providers raking in frankly obscene profits and the response from the Government so far is not sufficient.”

She added: “Last year, the 20 biggest private state providers of children’s homes and private foster placements made £300million in profits.

“And is the Government sure that these private providers are offering the best value for money and the best quality of care and the best services and, most importantly, the best opportunities for these children?”

Her comments came as the House of Lords debated the Government’s new strategy to fix children’s social care, which has been allocated £200million over the next two years.

The plan is a response to recommendations made by three independent reviews by Josh MacAlister, the Child Safeguarding Practice Review Panel into the tragic murders of Arthur Labinjo-Hughes and Star Hobson, and the Competition and Markets Authority.

We’ve already announced an investment of £259million to expand the number of children’s homes - we agree that it is not acceptable that children are sent miles from their roots

Baroness Chapman said she welcomed a consultation on national rules for the use of agency social workers mentioned in the plan, but also branded it “low hanging fruit”, urging the Government to also work on improving the worst providers.

Education minister Baroness Barran indicated that she was also concerned about the large profits being raked in by children’s social care providers.

She said: “I think the noble lady knows my views on some of the profits – I think my popularity on the benches opposite rose at that point.

“We’ve already announced an investment of £259million to expand the number of children’s homes – we agree that it is not acceptable that children are sent miles from their roots.”

The minister previously told peers: “In relation to excessive profits of independent providers, we are absolutely clear that we need to avoid profiteering from any providers, and the key to this is growing capacity in some areas.

“That is why we are supporting local authorities to expand their provision and reduce reliance on the private sector.”