Last week the BBC reported:
“A new “secure school” which aims to get young offenders away from gangs and knife crime is set to open in Kent following a £40m renovation. The Ministry of Justice said the “first-of-a-kind facility” for children and young people in custody would have “rigorous education and training” at its heart. The school in Rochester, operated by specialist education provider Oasis Restore, is on the site of the former Medway Secure Training Centre…Up to 49 children will be at the school at any one time – both boys and girls – and every young offender will be enrolled in formal education or training….The average cost per person per year will be about £250,000.”
But before you all cheer too loudly consider this report on the project from Schools Week from two years ago:
“The first proposed secure school for young offenders is now three years behind schedule and £31 million over-budget, a National Audit Office investigation has found. The school, for 49 young people on the site of a former secure training centre in Medway, was supposed to open in autumn 2020 and cost £4.9 million. But delays mean the school now won’t open until November 2023 at the earliest, with incorrect assumptions about timescale, changes needed to meet Ofsted requirements and arrangements for charity status blamed. The estimated costs of the project have also ballooned to £36.5 million, an increase of 645 per cent on the Ministry of Justice’s original 2018 estimate. It follows “significant design revisions after due diligence”.
The Chancellor of the Exchequer announced in his Budget speech in March that the Government would “invest £165m over the next four years” to increase the “capacity of the children’s homes estate.” New spending announcements in Budgets used to come at a torrent. There are rather fewer of them now. That is because we have “maxed out”, as the Americans would say, the nation’s credit card. The Budget announced that public spending is due to rise further, in real terms, over and above inflation. £1.216 trillion for 2023/24. £1.226 trillion in 2024/25. £1.252 trillion in 2025/26. £1.29 trillion 2026/27. Those are figures at current prices. Naturally, the pundits given airtime by the BBC, posing as independent experts but with their own ideological prejudices, say that this is still terribly austere and that spending should rise by much more. But that is probably impossible. Economic growth would get choked off by higher taxes. The interest on the National Debt would rise as the public finances became ever more dodgy.
So an extra £165 million on new places at children home places is an odd choice. First of all, as the experience from Rochester that along with every other public sector project costs and timescales are sure to escalate hopelessly. But also because there is no clear evidence that local authority placements at independent children’s homes cost more than those at their own children’s homes.
Here are some figures I obtained, via Freedom of Information requests, where local authorities had higher annual costs per child with placement at their own homes than in those of independent providers:
Blaenau Gwent £245,072 v £157,019
Bridgend £142,705.20 v £135,610.75
Buckinghamshire £271,555.71 v £266,535.00
Caerphilly £320,935 v £251,982
Derbyshire £268,195 v £260,965
Devon £516,522 v £259,000
Dudley £220,706.63 v £160,134
Hammersmith and Fulham £228,714 v £213,755
Hampshire £331,000 v £252,000
Hartlepool £251,000 v £225,000
Hull £246,250.00 v £244,376.00
Kirklees £368,524 v £238,566
Knowsley £324,390.26 v £298,132.31
Norfolk £248,134 v £209,968
Nottingham £282,412 v £257,712
Orkney £230,673.92 v £166,101.91
Oxfordshire £274,111 v £267,892.
Rotherham £333,602 v £307,985
Salford £368,684.00 v £123,355.62
Sheffield £452,400 v £241,956
Shropshire £372,513 v £269,578
Somerset £525,652 v £309,046
Wigan £261,413 v £261,404
There are some caveats. Many local authorities did not provide the figures – often they did not have their own children’s homes so could not make a comparison. There were some where the costs of LA provision were lower. But even then it was pointed out that you can’t make a valid comparison between a child with general needs and complex needs.
For instance, Cornwall Council told me that “the average annual cost for children in care placed in local authority registered children’s homes for the financial year 2022/23 was £0.236m.” By comparison, for independent registered children’s homes for the financial year 2022/23 “the average weekly fee was £6,205.” That comes to £322,660 a year. So might Jeremy Hunt’s announcement, at least provide good value if applied in Cornwall? Perhaps not. The Council adds: “However this is based on the total weekly fee that we have paid so may include extra services above the placement base rate eg mileage, therapy etc which may skew the average figure.”
There is no dispute that the costs of children’s home placements are absurdly high and produce disastrous outcomes. But it is false for the Conservatives to join the socialists in blaming “excess profits” or the “wasteful competition” of capitalism and looking to increased state provison for salvation. We need to focus on demand rather than supply. Far fewer children should be placed in these institutions. That is the way to stop the fat cats getting rich at the expense of the taxpayer – not by municipal empire building which would cost the taxpayer even more. As I wrote in February, a good start would be to challenge why children capable of attending mainstream schools should be regarded as requiring residential placements in children’s homes. Last year, Bristol City Council spent £774,165 for such a placement for just one child. Quite staggering. Wherever possible such children should be placed with foster carers, or better still adoption.