CYP Now - Profit Making and Risk in Independent Children’s Social Care Placement Providers

Local authorities in England spend more than £2bn a year buying fostering and children's homes services alone from private and voluntary sector organisations (collectively referred to as the independent sector). Local authorities themselves continue to provide most foster placements, but around two in every five foster placements are made with independent sector providers. In children's homes the reverse is true. Here, three in every four placements are made in the independent sector.

Consolidation sees groups of providers operating under single ownership structures. Picture: ASDF/Adobe Stock

In parallel with the continuing year-on-year upward trend in placement and spending activity there has been consolidation of providers leading to several large groups of services operating under single ownership structures.

Consolidation among independent providers is more advanced in fostering – the six largest providers have more than half of all placements made in the independent sector – than in children's homes where the 10 largest providers have around 30 per cent of all independent sector homes. Some of the larger groups of providers operate both types of service, and additional services including education, schools, and services for adults. They also provide services to other territories including Wales, Scotland, and Ireland.

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