Profits in residential children’s services in Scotland currently are at least £28,000 per child.
The trend direction is clear; the share of the market taken by private providers is increasing.
The Scottish Government has treated removing profit from children’s residential care as if it is very difficult but in fact there is no obligation to send any contracts to the private sector and a procurement framework for not-for-profit care already exists. There is no reasons to believe that the Scottish Government’s stated fear that it would lose capacity if it Ending Private Provision of Children’s Care Services 5 Common Weal committed to only non-profit care is well-founded since the same staff would be looking for the same job
For this reason, the provision of care could easily be transitioned to a nonprofit model.
The profit margin in the private sector is such that the better terms and conditions in the public sector could be met without additional investment.
A simple audit of care buildings would indicate how much it would cost to buy out existing buildings and transfer them to the public sector.
The biggest barrier to a shift to a non-profit system is the fragmented nature of services as they stand. A central team in every local authority should reverse this and instead of countless ad-hoc placements, would coordinate the care provision across the whole local authority. This would ensure continuity of care for individual children and would result in a more cohesive service.
So long as the Scottish Government holds its nerve then it is highly likely private providers would be willing to negotiate their exit from the system and for any who walk away, there are already procedures to enable government to take over that provision. There will certainly be very little sympathy for profit-extracting private businesses