Illegal nursing homes ‘profit’ from at-risk children

A family court investigation has found illegal children’s homes are charging up to £20,000 a week per child and are failing to protect vulnerable youngsters.

In a case heard in Liverpool in August, the court heard how a 14-year-old boy was still at serious risk despite the local authority paying high fees to an unregistered children’s home.

The increased demand for placements, particularly for children with the most complex needs, has led to costs that have been described as “explosive” by one senior judge.

The estimated cost of housing children in a local authority has more than doubled in three years to £16m, a senior manager told the BBC, in a move that could lead to the council going bust.

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It’s a busy day at Liverpool Family Court.

The BBC has taken advantage of the unprecedented access it offers to report on its proceedings, as part of a wide-ranging pilot project to make the workings of family courts in England and Wales more transparent.

Judge Stephen Parker is hearing two separate but very similar cases, both involving 14-year-old boys in a youth care home in the North West of England.

Both are violent and both are suspected of being criminally exploited by drug dealers.

They are the responsibility of several local authorities, both of which are forced to place them in unregistered homes, without Ofsted oversight. No other children’s home would take them.

Samantha Derbyshire is a senior manager at Cheshire East Council, where she is responsible for finding residential placements for children. She is giving evidence in one of the cases today.

Her local authority has to pay a whopping £20,000 a week per child for 24-hour care.

“This is public money,” she tells the BBC outside court.

“This is your money, this is my money, and they are taking advantage of our children without the experience and without the Ofsted regulations that go with it.”

She is struggling to find a place to take “Jack” (not his real name), who has been in an institution since February.

During that time he attacked staff and even broke one staff member’s arm.

While being moved between locations, Jack attempted to kick out the windshield of a moving car. Caretakers said they had to transport him in the trunk to protect himself.

Recently Cheshire East Council placed him with a private care provider that was not registered with Ofsted. The cost of the placement is £16,000 a week, which equates to £830,000 a year.

Despite this, Jack has run away repeatedly and regularly smokes cannabis at the orphanage.

One day he returned home covered in what looked like someone else’s blood. He wouldn’t say how it happened.

The council has now applied to the Family Court to have Jack moved to a new private children’s home, under a so-called Deprivation of Liberty (DoL) order.

This means he is constantly monitored by at least two staff members who can lock him in and physically restrain him if he tries to run away.

The new home, like the current home, is not registered with the regulator Ofsted, so it should be unlawful to place a child under 16 there.

However, Supreme Court Justice Steven Parker has the authority to authorize the placement and restriction.

He does so, saying that there is no alternative. He adds that there is a risk that Jack will “kill or be killed” if this order is not given.

Mrs Derbyshire told the court the local authority’s bill for residential childcare had risen from £7.5 million a year to an estimated £16.5 million over the past three years.

She says this is an overspend with a significant potential impact: “There will either be cuts in another part of local government, or we could be forced into bankruptcy.”

The new placement agreed for Jack costs £12,000 per week and the provider agrees to apply for Ofsted registration.

That same day, Judge Parker hears the case of another boy who – like Jack – is suspected of involvement in organized criminal gangs.

The boy, whom we’ll call “Joe,” has been in foster care for three years and has multiple felony convictions: one count of battery on a child and nine counts of vandalism and theft.

He is already subject to a DoL order and his local authority is asking the court to extend it.

The terms of Joe’s placement mean that he is supervised at all times by three members of staff, who are allowed to restrain him. He has been out of training for over a year.

Every now and then he leaves his house – under strict supervision – to visit his family or to go out.

But he has attacked staff and repeatedly tried to flee, once trying to jump from a moving vehicle onto the highway.

Judge Parker says he sees “a risk of catastrophic harm or a risk” and agrees to extend the DoL order.

Like Jack, he says that anyone who restrains Joe must be specially trained.

Joe’s placement is costing his local authority, Halton Council, £13,600 a week – around £750,000 a year.

Judge Parker describes the cost of the placements as “breathtaking” and notes that local governments are “essentially at the mercy of the private sector”.

He says local governments are often faced with a ‘Hobson’s Choice’ (a choice that is no choice at all).

Speaking to the BBC after the hearing, Ms Derbyshire said that while there were excellent Ofsted-registered placements run by private companies that did not charge exorbitant fees, there were also private care providers that were not registered or inspected. Some of them, she said, “were in it for the wrong reasons”.

Ms Derbyshire says some of these unregistered providers charge “staggering” fees and the placements are typically not staffed by trained social workers, nor do they provide specialist or therapeutic care.

However, she says it is difficult for municipalities to challenge the rates.

“They will always say it’s a cost to the board, or a cost to the person in charge, or a cost to management,” she tells us.

“And it is also difficult for us to have such conversations at the moment, because we know that there are ten other children waiting for that one bed.”

Ms Derbyshire says her council is no exception and many others face similar problems. Last year the Local Government Association said “immediate national action” was needed.

The Children’s Home Association represents providers registered with Ofsted.

According to CEO Dr Mark Kerr, his members want action taken against unregistered homes: “They are holding children captive who are not getting the care they need.”

Dr Kerr says the government should also support new specialist provision for children like Jack and Joe. At the moment, he says, it would be difficult to place them in homes with other children.

The Minister for Children and Families, Janet Daby, has told us that the government is committed to “crack down on providers making excessive profits” and that measures will be included in the forthcoming Child Welfare Bill, Labour’s flagship education and childcare legislation.

“It is devastating that these young people are being failed by a system that should keep them safe,” she said.

Meanwhile, more children like Jack and Joe appear before the family court.

The number of DoL orders has increased twelvefold over the past six years, from over 100 per year to 1,200.

Mrs Derbyshire tells us that she often worries about the safety of these children.

“I feel helpless,” she says.

“I keep thinking: where are they going tonight and is someone going to take care of them according to the standards we expect?”