A damning report by the Commons Public Accounts Committee warned that the use of unregistered care homes for children is widespread despite the Government vowing to stamp this out by 2027
Hundreds of children have been placed in illegal residential care homes due to chilling failures, a damning report has found.
Around one in 10 of all children in residential care were placed in unregistered housing – meaning they could be put at risk. The Commons Public Accounts Committee found the use of such homes is widespread despite the Department for Education (DfE) vowing to stamp this out by next year.
In September last year 800 children had been placed in illegal homes, the report found. Tory MP Sir Geoffrey Clifton-Brown, who chairs the committee, said: “The stated purpose of the children’s social care system is “to provide care for those who need it so that they grow up and thrive with safety, stability and love.
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“For the hundreds of children highlighted in our report living for months in illegally unregistered homes, a lack of oversight means we cannot know whether their circumstances are indeed safe, stable, or loving. A dysfunctional system is forcing local authorities to routinely reach for solutions which will see our nation’s children regularly put at risk.
“This utterly unacceptable situation has become normalised, but there is nothing normal about this unsustainable state of affairs.”
Today’s report comes after a separate document from inspectorate Ofsted last month(DEC), which warned fees for places in unregistered homes can be as much as £30,000 a week per child.
Ofsted said it had begun nearly 900 investigations during the 12 months to March 2025 into potential unregistered homes, “which often charge exorbitant fees to local authorities that have run out of options”.
Its report stated: “This shadow market only exists because there aren’t enough of the right kinds of places in legitimate registered homes to take the children who most need specialist support.”
The committee also noted that almost half (49%) of children in care in England were being placed in homes more than 20 miles away from their original family home. MPs said their research had uncovered a system where children are being placed in homes that do not meet their needs, with disparities in the number of places available in different areas of the country.
They warned that while the DfE was “relying” on a rise in foster carer numbers to help reduce demand for children’s residential care, “it has yet to address the significant challenges to increase numbers”.