Why illegal children's homes are being paid up to £2m per child by councils

Key developments are emerging from the global stage. Why illegal children's homes are being paid up to £2m per child by councils6 minutes ago Share Save Add as preferred on GoogleNoel TitheradgeInvestigations correspondentBBCThe bungalow doesn't look much like a children's home. A sheet of privacy film wrongly placed outside a window is peeling. Inside, the wallpaper is flaking, carpets are frayed and doors are broken.

The children's home is unregistered and therefore illegal but the provider is charging a council elsewhere in the country £13,000 a week to care for a vulnerable teenage girl. She requires the support of three full-time members of staff. There are no books, toys or games.

The Details

Just a few miles away, another illegal children's home is being run from a council house. Its tenant is subletting the property to a company that is also charging a different local authority thousands of pounds a week. Five years ago, my reports into such placements led directly to a government ban on the use of unregulated children's homes in England.

I found that children as young as 11 were being housed in homes that were not registered with or inspected by Ofsted. These included squalid flats, tents, caravans, narrowboats and a home under surveillance by the police for suspected gang activity. The previously found that a 14-year-old boy was placed in unregulated care on this narrowboat 200 miles from his familyI also exposed how one girl was trafficked directly from her home and sexually abused, while a boy was kidnapped from another home to sell drugs.

A Newsnight investigation said teenagers were being abandoned to organised crime. The 2021 ban on under-16s being housed in such homes was meant to bring an end to the practice. But in reality, councils struggling to accommodate children are placing more of them than ever in what are now illegal homes - at huge taxpayer expense.

What Experts Say

I've now learned of unregistered placements that are costing as much as £2m per child a year. The sector is a "Wild West", according to Dr Mark Kerr, chief executive of the Children's Homes Association. "This is the culmination of 10 years of systemic failure to develop specialist provision for our most vulnerable children," he says.

While the majority of children are either fostered, adopted or placed in legal children's homes, local authorities have struggled to find homes for children with the most complex needs - who are often the most expensive to care for. And in around 800 cases in England, councils have turned to unregistered homes, despite the ban on them, according to the Public Accounts Committee. So why, if the homes are unregistered and therefore illegal, are English councils still placing children in them?

And how can the system be reformed so this doesn't continue to happen? The scale of the problemCounter-intuitively, just as the use illegal children's homes has increased, the number of registered children's homes has soared - doubling from 2,209 to 4,455 in eight years, according to Ofsted.

The development has drawn wide international attention, with diplomatic circles watching closely.