Private Equity Firms Extract Millions From English Children's Care

Research from the thinktank Common Wealth reveals that private equity firms own or partly own 11 of the 20 largest providers of fostering and children's homes in England. The investigation found that the four largest independent fostering agencies paid more than £200 million in interest payments to shareholders since 2020, utilizing shareholder loans with interest rates ranging from 8% to 14%.

National Fostering Group, owned by Stirling Square Capital Partners, paid over £116 million in loan interest and £71 million in preference shares during this period. BSN Social Care, majority-owned by MML Capital Partners, paid more than £7 million in loan interest. National Fostering Group defended its operations, stating that its funds are focused on frontline care and the needs of complex children.

In response to the findings, Unison and Common Wealth are calling for a ban on for-profit provision and a return to public sector insourcing to prevent profiteering. While the UK government has pledged potential profit caps and better oversight, the Welsh government has announced plans to end for-profit children's social care by 2030.