Financial transparency and profit limitation in children's residential care: consultation analysis

Summary of views of other stakeholder groups

9.17 A key message from this group (which included some local authorities and care providers, as well as a wider range of stakeholders) was that there needs to be more evidence gathering and analysis undertaken by the Scottish Government before proceeding with a legislation. Questions this group thought needed to be answered included the following:

• How should ‘profit’, ‘profiteering’ and ‘excessive profit’ be defined? This is among the most challenging aspects of this work. Has the Scottish Government done any benchmarking on financial statements available online to determine what is meant by a ‘profit’ or what can be considered to be ‘excessive’?
• How do models of financial management impact on care for children?
• What can be learned from the experiences of Wales and England?
• What is the scale of the problem in Scotland and are the proposed measures proportionate?

9.18 Concerns expressed by this group included that:

• Providing care to children with complex needs can be very expensive. There is not always a clear understanding of what the cost really is. There are also high expectations (from the Care Inspectorate) about the quality standards of these services.
• Local authorities do not have the capacity to provide residential care services for children and young people. What will happen to the children and young people in services that end up being deregulated, or whose services have to close? If the children in these services are experiencing good care, it doesn’t seem to be in line with the aspirations of the Promise to close them down.
• There needs to be greater focus on quality of care, rather than just costs of care.
• Any proposals to address costs in residential care need to take account of the views of children and young people with experience of these settings.
• Three different parts of the UK were looking at this issue, and the response in each area may be different. This could cause issues for companies that provide care services in more than one jurisdiction.
• The Scottish Government is possibly being overambitious in relation to the timescales for implementing this legislation – this could lead to deteriorating outcomes for children.