Social Services: Children

Every child in care should have a safe and loving home which is also value for money for the taxpayer.

In their 2022 report, the Competition and Markets Authority estimated that the operating profit margins for large children’s social care providers between 2016 and 2020 were 22.6% for children’s homes, 19.4% for Independent Fostering Agencies and 35.5% for supported accommodation - well above what would be expected in a well-functioning market.

The Government is clear that profiteering from vulnerable children in care is absolutely unacceptable and both the Department for Education and Ministry of Housing, Communities and Local Government are committed to stamping out profiteering where it occurs in the children’s social care placement market.

In May, the Government made clear we would not flinch from using new powers to cap the profits of private providers in children’s social care if our assessment and consultation showed this to be necessary. The Communities Secretary wrote to local authorities alongside his statement and stated that by profiteering, he is referring to providers charging local authorities at unacceptably high rates that do not reflect value for money, with costs and profits rising faster than the quality or volume of provision.