Private equity companies now own or partly own 11 of the 20 largest providers of fostering and children’s homes in England, according to an investigation by the thinktank Common Wealth. This comes amid growing calls to ban profit-making in the children's care sector.
The investigation found that the four largest independent fostering agencies, which provide almost a quarter of fostering placements in England, have paid out more than £200m from taxpayers to shareholders in interest payments since 2020. These companies reportedly used shareholder loans, with interest rates ranging from 8% to 14%, to pay or reserve at least £205m to shareholders and investors.
Unison general secretary Andrea Egan described the findings as a “wake-up call” for systemic change, stating that “profiteering from children’s social care is nothing short of obscene.” The analysis also found that at least one in three fostering agency placements and one in five children’s homes placements are run by firms backed by institutional finance.
The UK government has pledged to curb profiteering in children’s social care through improved oversight and, as a last resort, capping profits. The Welsh government has committed to ending for-profit provision in children’s social care by 2030.