Ofsted has described the rising use of unregistered children’s care homes as a “national scandal.”
Its annual report reveals nine in ten councils across England are placing vulnerable children in settings that lack official registration, with some charging up to £30,000 a week per child.
Chief inspector Sir Martyn Oliver says the system is being “bent out of shape” by profit motives, with homes opening in cheaper areas regardless of local demand. He warns that rapid growth in the number of homes masks serious problems with affordability, suitability and location.
In the past year, Ofsted launched 870 investigations into suspected illegal homes, with 680 found to be unregistered. Operating without registration is a criminal offence, but inspectors currently have limited powers to issue fines.
Councils’ spending on children in care has more than doubled in less than a decade, rising from £3.9 billion in 2015–16 to £8.1 billion in 2023–24. The Local Government Association says the “astronomical cost” is leaving less money to support children before they reach crisis point.
The Children’s Homes Association has called for urgent government action, warning that the system is failing children with the most complex needs.
