Commercialisation and care sufficiency: the privatisation of children's homes in England

Although the commercialisation of care services is intended to produce markets that respond to care need, it is still unclear whether profit incentives align with population need. In this Health Policy, we examine the provision of the children's residential care market in England and whether it responds effectively to geographical need. We analysed comprehensive data on all children's homes in England between 2014 and 2023 and categorised providers as Local Authority, third sector, investment owned, individual owned, or corporate owned. We operationalised area need through net loss measures: the difference between the number of children placed outside a Local Authority versus those placed within it. Using Bayesian hierarchical models, we assessed the relationships between area characteristics, children's home locations, and ownership structures. In 2023, 852 (29·8%) of 2861 children's homes in England were owned by investment firms, doubling the number they ran in 2014 (414 of 1350 homes). All for-profit homes disproportionately located in areas of low need and investment-owned homes located more in areas with low house prices. Compared with Local Authority homes, investment-owned homes were less likely to operate in areas of high need and non-commercial homes were most likely to open in areas of high need. The commercialisation of children's social care provision has corresponded with less accessible services, contributing to sufficiency issues. Current market dynamics fail to address, and likely worsen, geographical disparities in children's residential care provision.