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Cost of unregistered children's care homes a 'national scandal': Ofsted
Children’s homes in England increased 15% to over 4,000, but placement shortages and high costs strain local councils and fuel unregistered homes charging up to £30,000 weekly.
- This year, Ofsted's annual report warned of systemic failings in children’s services, with Sir Martyn Oliver calling it an `ongoing national scandal`.
- A shortage of suitable registered placements, especially for children with complex needs, has fuelled a shadow market as providers open unregistered children's homes where housing is cheaper, driven by a strong profit motive.
- There were 4,010 registered children's care homes in 2024/25, while Ofsted launched nearly 900 investigations into potential unregistered homes, which charge up to £30,000 a week per child.
- Councils face budgetary strain as Ofsted warned their budgets cannot keep pace with spiralling care costs, and currently Ofsted can only issue warning letters though new powers are expected under the Children's Wellbeing and Schools Bill.
- As of June 2025, 172,400 children were homeless and living in temporary accommodation, inspectors warned the situation is especially dire for children aged 10 to 17, and the Children's Homes Association urged the government to `fix the system`.
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Ofsted criticisms of ‘profiteering’ children’s homes prompts counterblast from provider body
Ofsted criticisms of “profiteering” in the children’s homes sector has prompted a counterblast from the main organisation representing providers. The regulator said that the rapid growth in the number of homes and their concentration in cheaper areas suggested decisions were being driven by profit rather than children’s needs, in its annual report, published yesterday. As a result, homes were being sited in areas where they weren’t needed, leavi…
Ofsted annual report warns against ‘profiteering’ in children’s homes sector
Annual report sees great work being done by education and care professionals but there are concerns about the rapid growth in children’s homes, and outcomes for disadvantaged and vulnerable children remain poorer than their peers.
·United Kingdom
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