Competitive market pushing children’s services ‘close to collapse’

“Markets do not care about children – people do.”

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A competitive market model has brought council children’s services close to collapse, a charity boss has warned.

Kathy Evans, chief executive of Children England, told an Institute for Government event that the current system of care provision is not working – with 75% of children’s homes owned and run by the private sector, and a significant portion owned by hedge funds.

“The idea of a competitive marketplace in children’s care is not working for children. Markets do not care about children – people do,” she said.

Children England – the membership group for children’s charities – fears competitive market methodology has drained the sector of profits.

Evans told IfG Election 2019: How to improve public services that the system was “close to collapse”.

Funding for children’s and young people’s services has fallen 29% since 2010, and councils face a funding gap of £3bn by 2025, according to Action for Children.

This, as an average of 88 children are coming into care every day, according to LGA figures.

In the Spending Round, the government announced around £1bn would be shared between child and adult social care in 2020-21.

Another speaker at the event, David Walker, former managing director of the Audit Commission, said there was not enough data on public service outsourcing to prove that it is effective.

“The idea that public services are cheaper and better because of outsourcing is simply not borne out,” he said.

Event chair and IfG programme director Nick Davies said there is a lack of evidence and data that supports arguments for both outsourcing and insourcing as an effective method of services provision.

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