Yorkshire council denies claims it is 'at the mercy' of private companies running children's homes

Councillor Stewart Golton said it is “appalling” that Leeds City Council has not opened any of the eight new children’s homes (each providing two places) that were announced in September 2021.

It is part of the Labour-run council’s plan to become less reliant on private providers, which currently run 80 per cent of the homes in England

Councillor Fiona Venner, Executive Member for Children’s Services, has not revealed when the homes will open but said “it is nonsense to suggest that Leeds has been behind the curve” in addressing this issue.

It comes as leaders of struggling local authorities across the country are urging the government to cap the fees which have soared in recent years due to a nationwide shortage of places.

In Leeds, the council is responsible for more than 1,500 children who have been taken into care and the 10 most expensive placements amount to around £3m a year.

Across the country, the 20 largest providers were paid £1.63bn last year to provide residential accommodation and they kept almost 19 per cent of the money (£310m) as of profit, according to the Local Government Association.

Councillor Golton, leader of the Liberal Democrats in Leeds, said: "Residential care delivered directly by local councils is a fraction of the cost that the private sector charge, and we should be building and staffing such accommodation at pace to protect more and more money being diverted from elsewhere in the council, that means other services get cut.

"If the Labour administration had swallowed its pride, and followed up our call for more council accommodation to be built in 2018, we would be in a much more sustainable position.”

He added: "Instead, the council made a commitment to make a start two years ago, but their lack of urgency in making it happen has left us millions out of pocket instead."

Councillor Venner said the council has responded to “a rapid rise” in the number of children needing care caused by rising levels of poverty and cuts to support services to struggling families.

“Despite sustained cuts to local government funding, Leeds has retained more beds provided by our own children’s homes than most local authorities and, against the national trend until recently, our numbers of looked after children were coming down,” said the Labour councillor.

“We are increasing our in-house provision by creating a further 25 places in response to the recent increase in costs of private residential fees."

She added: “Our plan is underway and is being accelerated for completion over the coming year.”

There are more than 82,000 children in care and councils, which are legally required to find accommodation for every child who needs it, are forced to bid for a small number of places.

The average cost reached £3,830 per week per child in 2020. But prices are still rising for local authorities like Bradford Council, which now pays an average of £6,000 each week.

There has also been a sharp increase in the number of placements costing at least £10,000 a week in England, according to the Local Government Association. There were 120 of these placements in 2018/19, rising to 1,510 in 2022/23.