Watchdog considers opening investigation into children’s social care market

The Competition and Markets Authority says there are “clear indications” the market is not working as well as it should, after calls to investigate from the Chair of the upcoming Independent Review into Children's Social Care in England.

The Competitions and Markets Authority (CMA) says it is “actively considering the case” for an investigation into the children’s social care market, responding to a request from the Chair of Independent Review into Children's Social Care in England.

Responding to the request, the watchdog said: “While we need to consider carefully which market studies to undertake, there are clear indications that the children’s social care market is not working as well as it should. We are therefore actively considering the case for future work in this area.”

The CMA is a non-ministerial government department responsible for preventing and reducing anti-competitive activities and strengthening business competition.

Josh MacAlister, Chief Executive of Frontline and soon-to-be Chair of a wide-ranging review of children’s social care in England, wrote to CMA Chief Executive Andrea Coscelli on Monday, saying an investigation by the authority would “provide invaluable evidence to my review”.

MacAlister said there were concerns around the insufficient supply of homes for children that meet their needs, the high and rising costs of placements, and the role of the private sector in the placement market.

MacAlister’s letter follows other calls in recent years for the CMA to investigate the children’s social care market from both the Children’s Commissioner in November last year, and from the Housing, Communities and Local Government Select Committee in May 2019.

Urging the CMA to investigate in her 2020 report ‘Private provision in children’s social care’, the Children’s Commissioner for England said: “It is imperative that the Government and local authorities understand how competition constrains prices in the sector and, where it doesn’t, what the alternatives are.”

The Housing, Communities and Local Government Select Committee made similar recommendations in its 2019 report on children’s services funding, saying: “There may also be a role for greater regulation of the market to ensure that costs do not rise disproportionally and that there is appropriate competition.”
In the same document, the select committee also recommended the National Audit Office “analyse and compare the cost and value for money of private and in-house children’s residential care provision.”

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