How can a child in care cost £281,000 a year? Ask the wealth funds that have boards about a barrel | George Monbiot
I‘I am a patron of a small local charity that helps troubled children rebuild trust and connection. It is called Sirona Therapeutic Horsemanship, and it works by bringing them together with rescued horses. The horses, like many of the children, arrive traumatized, anxious and scared. They help each other to heal. Children who have lost their trust in people can find it in horses, who do not threaten or judge them, and then gradually build that relationship to reconnect with people.
It is amazing and inspiring to see the children begin to calm down, relax and find purpose and hope. It can have life-changing consequences. But while I cannot in any way speak for Sirona, I am painfully aware that such charities can only help a small proportion of children who are in desperate need of stable relationships, trust and love.
Some of the children who come to Sirona are in healthcare, a sector that has now become a business. Children’s homes, foster care and special schools have been steadily taken over – with the blessing of successive governments – by profitable companies. Private agencies now own 36% of England’s foster care sector, while companies make profits owns 83% of children’s home care. “Supply blocks” – that is, numbers of children – are traded from one company to another. How much is a person worth? A child’s worth is written in the books, as dedicated journalist Martin Barrow documents £100,000.
So this is what I learned. That nothing is sacred now. Nothing is too valuable, too important, too fragile not to be hacked and stacked and used as fuel for the bonfire of capitalism. Interested as we are in the destruction of all that we hold dear, turning children into commodities from which commercial enterprises can make profit stretches the boundaries of faith. Can it be true? Is this really how the system works? Yes and yes.
Children in homes generate average £910 per week profit per week for the companies they control. Create large commercial providers of children’s homes average profit of 19%, according to a report commissioned by the Local Government Association – an astonishing return. Ordinary companies would do well to earn 5%.
Who are these lucky companies? An Observer investigation found that many of these are private equity, venture capital and sovereign wealth funds. Among the owners is the state of Qatar and the emirate of Abu Dhabi, whose healthcare company in Britain, which mainly invests in special schools, made a 26.5% profit in 2022. Our government finds it unacceptable for the Telegraph newspaper to be bought by the United Arab Emirates, but acceptable for essential public opinion. services that will be owned for profit by this cluster of dictatorships.
Some providers are highly opaque, registered in foreign secrecy regimes and largely unfathomable to those who want to discover whether their businesses are sustainable. In some cases their business model resembles that of the privatized water companies: burden themselves with debts, sucking away profits and dividends, dumping risk and creating what could be a very unstable system. In some cases, their ability to pay off these debts depends on their huge profit rates. If these were to falter, they would collapse. Because a few large companies now dominate the sector, the failure of any one of them could be catastrophic for thousands of their “transferable assets,” known to you and me as children in care.
Who pays for these profits? On the surface: our local authorities – and by that we of course mean all of us. This month, two Northamptonshire councils announced they are paying an average of £281,000 a year for each residential placement, or £5,400 per week. A direct comparison cannot be made as many children in care have complex needs, but for reference only Eton’s eye-watering fees are £46,000 a year. This is exacerbating the impact of austerity: a combination of massive cuts to council budgets, the rising number of children in care and the astonishing profits made by private operators are pushing many local authorities to the brink of bankruptcy.
But those who pay the highest price are of course the children (in addition to the shelter staff and foster carers). often ruthlessly exploited). In many cases, the residential care company works as follows: the companies rent, buy or build houses where there is land and real estate cheapest, and then offer slots to local authorities. Children are sometimes moved hundreds of miles to the cheap accommodation, cutting ties with siblings, friends, teachers, carers, therapists, courses and everything else that is familiar. Children in south Devon are being sent to Liverpool and Yorkshire, 300 miles away.
There are extreme cases, such as that where the 12 year old is ‘placed’ (dumped seems more appropriate) in a caravan on a campsite. Others have been ‘placed’ in tents. Some private providers offer good service once children end up in a home. But the model itself, which routinely uproots children and breaks connection and trust, can nevertheless be devastating to their well-being. When children working for Sirona are suddenly transferred from the region to a residential home on the other side of the country, the commitment and trust that the charity began to develop is shattered and they are once again set adrift.
The system is in crisis, but a crisis is lucrative. The independent assessment of children’s social careon the instructions of the government after repeated requests from local authorities and published in 2022, emphasizes the crucial point that private providers may ‘refuse to engage in efforts to rationalize the system because they have no incentive to see it reformed. Constant chaos means they are deliberating over a vessel. Systemic dysfunction forces local governments to make expensive last-minute ‘spot purchases’ of residential care, rather than, for example, setting up regional care cooperatives, which could predict and absorb demand, invest in public or non-profit facilities and enabling children to stay close to home. For these and many other reasons, the study concluded that “care for children should not be based on profit.” But the government doesn’t want to listen.
How could we have reached this point where the exchange of children for profit has been normalized and generalized? Well, by following the dominant, toxic ideology of our time – neoliberalism – to its logical conclusion: that everything, regardless of inherent value, can be bought and sold.