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‘Government funded trap houses‘? Unregulated care homes and County Lines

Insights Perspective


Joe Caluori, Head of Policy

Thursday 23 July 2020

Amid concerns about untrained staff, unclear responsibilities and cases of violence, exploitation and abuse, the Government are currently considering changes to the rules on looked after children (LAC) being placed in independent and semi-independent settings.

In the second long read for our current research project into County Lines and Looked After Children, we examine whether the growing use of unregulated care homes has indeed increased the risk of exploitation in county lines drug networks for vulnerable adolescents in the care system, drawing on the findings of field research in Merseyside.

What are the lessons from Merseyside and will the Government’s proposals go far enough to resolve the weaknesses in the current system? Is the present system placing vulnerable adolescents in settings which are little more than ‘Government-funded trap houses’, used by organised crime groups to recruit and exploit them in county lines?

Vulnerable adolescents in the care system

Looked after children are a prime target group for the organised criminal gangs (OCGs) and criminal groups that operate county lines. Rescue Response, the London-based County Lines service, published data showing that in their first year of operation, as much as a quarter (24 per cent) of their caseload were in care. In our own research, data shared with Crest by North Wales Police shows that 30 per cent of missing investigations flagged by the police as involving Criminal Child Exploitation (known as a CCE flag) concerned children in the care system. In addition, the National Crime Agency have repeatedly highlighted the risk posed to looked after children by gangs operating county lines.

Since 2015, the number of children taken into local authority care has increased by 12 per cent, from just under 70,000 (rate of 60 per 10,000 children under 18) to nearly 80,000 (rate of 65 per 10,000 children under 18). This increase is predominantly accounted for by adolescents, with the number of looked after children in the age groups ‘10-15’ and ‘16 and over’ increasing 18 per cent and 21 per cent respectively since 2015. This has presented local authorities with the challenge of securing appropriate placements for adolescents with complex, multiple vulnerabilities.

The rise of unregulated care homes

A family environment, such as a foster family, is widely agreed to be the best environment for a child in care. However, foster care placements, scarce at the best of times, are difficult to source for adolescents. Adolescents, especially those exhibiting challenging behaviour, are a daunting prospect for a foster carer, especially with the levels of funding currently on offer from local authorities and independent fostering agencies.

Children’s homes providing care for looked after children must register with Ofsted, abide by strict rules and regulations and submit to regular inspection. These placements are often used for older children in the care system, but this remains a challenging market for local authorities to navigate. There is competition for places in care homes rated good or outstanding by Ofsted, and these places come at a financial premium. So how have local authorities plugged the gaps and met their obligation to secure sufficient placements?

This is where the role of the rapidly expanding sector of ‘unregulated care homes’ comes into the spotlight. Charts A and B (below) show that beneath the eye-catching figure of an 80 per cent increase in the number of looked after children (LAC) living in these settings (from 3,430 in 2010 to 6,190 in 2019), in fact the numbers of children in such placements stayed fairly consistent until 2015, after which we can see particularly steep rises for placements of looked after children in semi-independent accommodation.

Chart A: Number of children in independent accommodation and semi-independent accommodation at 31 March (2010-2019)

Source: Department for Education, Looked after children in independent or semi-independent placements

Chart B shows that the number of looked after children starting to be looked after in independent and semi-independent living accommodation has increased by 79 per cent and 108 per cent respectively in the last five years. This strongly suggests that over the last five years these placements have been used to accommodate a surge in demand for unplanned placements for vulnerable adolescents - rather than planned placements to help young people to transition to independence.

Chart B: Children who started to be looked after in independent and semi-independent living accommodation during the years ending 31 March 2015-2019

‘Unregulated care homes’ as they have come to be known, fit into two broad categories - independent (or supported accommodation/ supported living) and semi-independent, depending on the level of supervision and support on offer to residents. These settings could be operated by housing associations, local authorities or charities but over three quarters (77 per cent) of LAC in unregulated settings are accommodated by private providers. These settings are not required to register with Ofsted and are not subject to inspection.

There is huge variability in terms of the quality of accommodation on offer at these establishments. Providers such as the St Christopher’s Fellowship offer high-quality accommodation, often to young people with highly specialist needs, and others such as the privately run Keys Group have voluntarily submitted their independent and semi-independent settings to the Care Quality Commission for inspection.

Professionals and experts we have engaged with in the first phase of this research expressed concerns about privately run settings that have entered the market in recent years. There is a perception that providers often charge local authorities substantial fees, ranging from £900-£3,500 per week, yet often fail to deliver the standards of accommodation and supervision they promise.

The vulnerabilities young people in unregulated accommodation face are exacerbated when they are placed in settings at a distance from their home, so it is a matter of concern that 45 per cent of semi-independent accommodation placements are outside the boundary of the young person’s home local authority.

The following comments by young people in unregulated settings - included in a briefing recently compiled for MPs by the National Youth Advocacy Service - appear typical.

“My experiences living in that type of environment [unregulated accommodation] was a living nightmare. The number of stories and scary experiences I’ve faced during living there will probably stay with me forever.”
“Almost everyone was carrying around illegal weapons, everyone was engaging in gang activity and the levels of drug use was appalling. The amount of nights I was woken up to screaming, other kids fighting or the fire alarm going off at 4am. This made it impossible for me to continue my studies, so I never got to finish my college course.”
“There is always an easy escape living in [unregulated] supported accommodation and that's drugs because no matter what day or time it is you can always get hold of some or somebody is always willing to share.”

Unregulated care homes and county lines: ‘Government funded trap-houses?’

To explore the relationship between the increased use of unregulated settings and county lines exploitation of looked after children, Crest analysed data on children reported missing in the Merseyside Police Force Area and spoke to a number of senior police officers charged with disrupting county lines and protecting vulnerable children in Merseyside Police.

Given the scarcity of published (or indeed unpublished) data on local or national cohorts of children involved in county lines, missing data is often used as a proxy to understand the scale of the problem. This is possible where police missing data includes flags for CSE, CCE and — as in Merseyside — county lines. Where these flags are applied consistently and reliably, missing data allows us to see which types of children are targeted by OCGs.

Chart C shows that whereas around 4 in 10 missing incidents reported to Merseyside Police involved looked after children, this cohort accounted for over a half of missing incidents in which the child had a CCE flag. Notably, 1 in 5 of the missing incidents involving a child with a county lines flag involved a child from semi-independent accommodation.

Chart C: Reported Missing Incidents, broken down by flag and accommodation type (April 2018-March 2020)

Source: Missing Incident Data from Merseyside Police Force

The table below identifies the ten individual children with county lines flags with the greatest number of missing Incidents. Four of the top ten were looked after children placed in semi-independent accommodation at the time of their most recent episode. The top three were all in semi-independent accommodation. Three of the four children also had a number of previous missing incidents recorded from children’s homes, prior to their subsequent semi-independent placements: one had 9 prior missing incidents, one had 12 and a third had 33. One might legitimately ask whether it is appropriate for children with a county lines or CCE flag and multiple missing incidents to be placed in a semi-independent setting.

Table 1: Top 10 children with a county lines flag with the highest number of Missing Incidents (between April 2018 and March 2020)

Problems with semi-independent accommodation

When young people are placed in residential care or unregulated settings in a new police force area, the police — and the local authority — are often given too little information to effectively safeguard them. It’s rare for a placing local authority to consult the local police about whether the location of a placement poses any specific risks to the young person, or makes the setting unsuitable. The police usually only become aware of a vulnerable young person when they are reported missing or are arrested. This means the police in areas such as Merseyside, where a large number of children are placed in settings from outside areas, are left with a limited picture of who the most vulnerable young people resident in their patch are, what their vulnerabilities are and what they might need to do to manage the risks around those children.

Yet if the problems with semi-independent accommodation are partly true of all out-of-area placements, the senior police officers we spoke to in Merseyside also described four additional layers of difficulty.

Firstly, whereas the PCSOs and neighbourhood police teams are often able to develop relationships with registered care homes on their ‘patch’, it is far harder to establish such a relationship with unregulated settings. The reduced staffing and supervision in those settings and their high staff turnover means that local police are unable to make productive links. The police also complain that these settings frequently seem to open, close, move and reopen with little or no warning.

A second problem reported by the police in Merseyside is that unregulated settings are concerned that they do not appear to provide ‘care’ to their residents, as this would require Ofsted registration. Because of this caution, staff are often unclear what their responsibilities towards looked after children are. In the past this is said to have led to a reluctance in some settings to report missing episodes.

Thirdly, there is the issue of supervision. A looked after child is subject to the same statutory regulations whether they are in a registered children’s home or semi-independent setting. This means there must be a visit from their social worker within five days of the placement and a looked after child (LAC) review within twenty days. A care plan for a vulnerable young person may involve protective measures such as a curfew. But whereas a registered care home may enforce that curfew, a semi-independent — with looser supervision — may not. The police in Merseyside describe semi-independent settings as an environment in which young people typically come and go as they please, enjoying a high level of freedom, despite legally being children until their 18th birthday.

Finally, as there is no relationship between the unregistered settings and Ofsted, the police have no way to flag concerns about individual settings in such a way as to alert local authorities who may use those settings, other than through multi-agency meetings about individual children on a case by case basis.

Criminality and ownership of unregulated accommodation?

As part of our project, we have spoken to officers from the Merseyside County Lines and Serious Violence Unit, the Merseyside Violence Reduction Unit and the Liverpool Missing Persons Unit — and, in North Wales, officers who police county lines running from Merseyside. In these interviews, it has been suggested to us that OCGs and criminal groups not only target individual unregulated settings, but may also coerce young people to engineer a situation, with or without parental collusion, where they are taken into local authority care with the explicit aim of using their placement as cover to work on a county line and/ or recruit their peers for participation in county lines.

It is important to note that we have not so far been able to evidence these claims, but these suspicions remain amongst police officers in both North Wales and Merseyside. Neil Woods, ex-undercover drugs squad officer turned campaigner and author, described to us the lengths to which OCGs would go to build and protect their business. Although no evidence has yet been found to prove this tactic has been used, he, and many police officers we have interviewed, agree that it is plausible that OCGs would have sought to do so.

There are, however, known aspects of the market around unregulated settings in Merseyside which seem to point towards a darker purpose, either of criminality or highly irresponsible profiteering. This is especially worrying in a context where the number of unregulated settings is rapidly increasing. In St Helens, for example, the number of unregulated care homes has nearly doubled in recent years — from 29 to 55.

There is often a confusing nexus of companies and individuals involved in unregulated settings. There are many players: the owner of the building, the owner of the company running the provision, the managers, the staff. Often there are complex chains of companies involved.

Amid this confusion — who are the true responsible parties? Are they who they claim to be? Are they suitable people to work with children? Are they profiteering or, worse, laundering the proceeds of organised crime? — Merseyside police have attempted to contain the growth of unregulated settings by working through the planning system to influence decisions made by planning authorities on planning applications.

In one example shared with us by the Missing Persons Unit Prevention team, a former doctor applied to convert a residential care home into a supported accommodation setting. CQC had closed the home because of ten serious breaches and fears for people’s safety, including kitchens that were unsafe, a rodent infestation, faulty electrics giving staff static shocks and serious fire risks. The local authority refused the application and this decision was upheld at appeal by the planning inspector.

In the second case, the applicant had seven known aliases and eighteen previous convictions, even using an alias on the planning application form. The applicant had applied simultaneously for two homes at two different addresses. Happily this application was also refused.

In the third case the applicant was subject to an investigation by the local authority when they worked for another supported accommodation setting, for failing to follow safeguarding rules when a gun was found in the possession of a young woman. The police took no further action but the applicant and a colleague were subject to disciplinary action by their employer. The applicant did not give their first name on the application form. This application was approved by the local council.

The fact that the application in the third case was approved despite police objections, underlines the need for local authorities to, when they are making these decisions, fully explore the powers that they have — preventing settings that pose a risk to vulnerable young people or the wider community from establishing themselves.

These case studies paint a damning picture of some of those who wish to provide accommodation for vulnerable adolescents. As one of the police officers we interviewed put it: “I would never allow my son to stay alone in one of those places for even two or three days — why would we expect any other child to stay there?”.


During our research, we have heard anecdotal evidence from social workers, police officers, academics and campaigners that unregulated settings are an acute risk factor for county lines exploitation.

The continually changing resident groups in these homes — a mix of looked after children, care leavers, unaccompanied asylum seeker children (UASC) and young people accommodated under homelessness legislation — and the mixture of needs and vulnerabilities, all accommodated in predominantly densely populated urban areas often with minimal supervision, creates the perfect conditions for recruitment for county lines either by adults or peers. As one social worker we engaged with in Phase 1 of this research said to us, ‘They (unregulated care homes) are ‘Government funded trap houses’.

Coordination and risk management between local authorities, the police and the providers is inconsistent. If a new resident at a setting poses a risk to another young person, there is no guarantee that their social worker or their family will be made aware. Instead, the first local authorities hear about new residents is often from the young people themselves, through disclosures during visits from their social workers.

When a vulnerable adolescent in care is placed out of area, responsibility for their welfare lies with the local authority placing them. It is the responsibility of that authority to inform the host local authority about the placement and to make the necessary checks to ensure the area and the placement are safe for the child. This should involve engaging with the local police. The evidence we have heard from social workers and children’s social care managers is that this checking is minimal in terms of meeting basic statutory requirements — let alone regularly checking in with providers of placements to make sure that there are no new risks.

However, it is clear that local authorities rarely have access to the type of placements that might offer a vulnerable adolescent a safe environment in which they can thrive. Evidence of vulnerable adolescents in care being exploited through county lines and being coerced to recruit peers should raise alarm bells as to how, as a society, we are failing these young people for whom we have assumed responsibility.

It seems likely that the Government will implement new rules for the use of unregulated care homes on which they have consulted. This includes stopping the use of such placements for those under 16, driving up the quality of support offered in independent and semi-independent provision through new national standards, introducing new measures so that local authorities and local police forces liaise before a placement in this provision is made, and giving Ofsted new legal powers to act against illegal providers.

But do these proposed changes go far enough? If the options for accommodating vulnerable adolescents in care remain limited to the narrow range of options currently available, the goal of protecting a generation of adolescents in the care system from criminal exploitation will remain out of reach.

How have we arrived at this point? Adolescents in the care system, many of whom have complex needs, do not perhaps elicit the same public sympathy as younger children. They may exhibit challenging and difficult behaviour. They are on the cusp of transitioning into adulthood and independence. They may be difficult for professionals to work with.

Given the amount of money spent on accommodating these young people and the hours of time required from social workers, police officers and health workers to keep them safe, it doesn’t seem that protecting vulnerable adolescents from exploitation is a question of resources, but more one of accountability. Who will take responsibility for helping them transition safely to adulthood? Is it right that they are often placed in accommodation hundreds of miles from home? How can we get a balance between ensuring their short term physical safety and having long term plans in place that enable them to build a life for themselves and escape the gravitational pull of organised crime?

Bold thinking is needed to develop an offer for vulnerable adolescents coming into care which will enable them to have a beneficial experience of care for the short time they are in the system, improving their mental and physical health and emotional wellbeing, alongside educational and employment goals.

There must surely be a case for investment, driven by central government, to develop alternative models of care for vulnerable adolescents. This could include intensive one-to-one fostering relationships, with youth workers or other adults with experience of working with vulnerable teenagers, receiving training and funding to see these children through the last years of their adolescence and into adulthood.

Considering how poor the outcomes are for children who come into care in their later teenage years, and the cost to wider public services that result from these poor outcomes, it is surprising how little effort has been made to seek viable alternatives. We will return to this question in our final report later in the year.


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