Private child social care providers in England will be kicked out of the system if they are found to be making a profit, the children’s minister has said.
Josh MacAlister, who oversees the overhaul of the care system for children, also called for an increase in matching the Homes for Ukraine scheme to provide homes for thousands of children.
Announcing a major push to recruit 10,000 new foster carers as part of a bid to balance child social care from private providers, MacAlister said the state was “failing to provide the lifelong, loving relationships these children need”.
MacAlister led one independent review of child social care under the last Tory government before becoming an MP and then a minister. He said his message to private providers is: “If you want to be part of this system in the future, don’t measure the price; don’t make a profit.”
He added: “Maybe there are some [private] Providers of that mixture who are on board and those who are not are rejected by the system.
Ministers are carrying out an urgent review of the financial security of private providers of child social care, and have come down on the growth of profits in the sector – warning that they will implement a cap on profits if profiteering by private providers is discovered.
An oversight mechanism that would take place within months would reduce the risk of a repeat of the Southern Cross scandal, which saw the collapse of a major private equity-backed UK care home provider in 2011 after a rapid and unsustainable expansion, MacAlister said.
Landmark legislation to eliminate private profit from children’s social care services in Wales came into force in April last year, while in Scotland the government trying to limit for-profit operators. But in England, more than 80% of children’s homes are for profit. In 2022, the Competition and Markets Authority found that children’s home owners in England, Scotland and Wales were making too much profit while carrying too much debt – exposing children and councils to unacceptable risks.
Taxpayer spending on residential care has doubled in England since 2020, with residential care costs reaching £3.1 billion by 2023-24, meaning each children’s home will cost more than £300,000 a year.
Roxy Wilson, a contestant on this year’s BBC program The Traitors, and who has experienced foster care, said: “People think they can’t get support, but they do.
Wilson said she saw firsthand the difference a stable home can make after experiencing foster care early in her life before being adopted by Judy Wilson, who also appeared on the show.
A new national system will seek to stop an exodus of foster carers, which has seen the number of people approved for foster care fall by almost 12% in the last decade, with the decline even greater since the Covid pandemic.
The government’s £88m fostering plan will also include £25m to help potential fosterers update or extend their homes to accommodate more children, and will see a rollout of pilots that will see potential fosterers help part-time. The new regional fostering hubs will provide stronger guidance on who is suitable, challenge “old-fashioned” ideas that they should be married, own a home or not have a full-time job, and help local areas work together to recruit and provide support to local parents.
MacAlister said the recruitment drive was a “call to arms” and compared the drive to the Homes for Ukraine scheme, which saw more than 100,000 people offer a place in their homes to Ukrainian refugees in the first 24 hours. “The public is ready, they want to play their part in this. We just need to change the system so they can go ahead and do their bit,” MacAlister said.
Sarah Thomas, the chief executive of The Fostering Network, said the government’s pledge to find foster families for 10,000 more children by 2029 was a good step forward, but there was a need to focus on retaining foster carers and increasing wages as some care reached poverty levels.
“Retaining foster carers is as important as recruiting them, so the lack of equal emphasis on retention and financial support is disappointing,” she said.