DfE plans will curb profiteering but not without cutting care placement supply, say social workers

Most social workers believe Labour’s plans to tackle profiteering in children’s care will succeed, but not without consequences, a poll has found.

The Department for Education’s (DfE) proposed reforms include regional commissioning of care placements, greater transparency around provider pricing and new powers for Ofsted to investigate providers of multiple children’s homes and fine providers of unregistered services.

Should these measures not succeed in bringing down excessive profit-making from care placements, the government has said it would introduce a cap on providers’ profits.

But do social workers think these measures will work?

Reducing profiteering to affect care placements

A Community Care poll of nearly 800 social workers revealed that most (73%) were confident that the DfE’s plans would curb profiteering.

However, most of this group – and 60% of all respondents – said they would also result in a reduction in the already scarce supply of care placements. 

Just over a quarter (27%) believed the reforms would make little or no difference.

Reforms require ‘commitment by all services’ to work

Social worker Tom J questioned how the government would address the issue of providers “making excessive profits” on the grounds that they would be unlikely to be transparent and co-operate voluntarily.

“Many care homes in the UK are owned by private equity companies, including those based in Qatar and the emirate of Abu Dhabi. They have to make a profit. The company will never open up its books, but the care provider they own may be able to open up about their data.”

Mark Corrigan argued that the way forward was not reform, but increased funding for local authorities to create specialist provision, while Steve advocated fostering competition in the sector by encouraging local care providers to open children’s homes.

“Councils could do this by engaging with the already existing good quality provision and inviting them to branch out into new areas, such as children’s homes,” he said. “Many elderly or young adult providers would jump at the chance to make a better profit […], but moving into another market is risky.”

However, another practitioner, Annie, doubted the government’s capabilities to tackle profit levels, citing its track record in other sectors.

“Based on the government’s success in tackling profiteering of private companies in other sectors (railway, fossil fuel, and water companies spring to mind), I wouldn’t hold out hope for either reducing costs or better provision in the care sector any time soon.”

What are your thoughts on the DfE’s plans to tackle profiteering in children’s social care?