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Rochdale: companies make millions from running care homes

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Government inspectors from Ofsted have launched an investigation into one of the care homes at the heart of the Rochdale sexual abuse case.
Issue 2304

Government inspectors from Ofsted have launched an investigation into one of the care homes at the heart of the Rochdale sexual abuse case.

Its management had been warned more than once in the last two years about its standards of care for vulnerable young people.

Accomodation is cheap in poverty stricken Rochdale. That’s one reason it has up to 47 private care homes that councils from across Britain use to house teenagers who have been referred to social services.

Up to 75 percent of children’s services in Britain are privatised. Green Corns was the company running the “solo care” home in Rochdale when its only resident was suffering sexual abuse.

Solo care means that a number of staff are dedicated to looking after one young person. This costs the council over £250,000 a year.

The work is a profitable business. Green Corns was bought up by private equity group 3i for £26 million in 2004 and became part of Continuum Care and Education Group. Annual operating profits reached £2.7 million.

In turn Continuum was bought up by Advanced Childcare Limited (ACL) which itself had been bought by another private equity company, GI partners, in April last year.

Then managing director, Alfred Foglio, boasted, “Advanced Childcare has pioneered the trend of managing children’s care services on behalf of budget constrained local authorities.”

ACL is now the largest provider of specialist children’s care and education services in Britain.

It reported an annual turnover of £15 million in 2010, up from £11 million a year earlier. Pre-tax profit increased to £2.6 million during that period, up from £700,000 in 2009.

Most of this income is from local authority contracts for residential care. The combined company now runs 143 children’s homes with 416 placements, 15 special schools and over 100 fostering placements.

The company’s founder Riz Khan has high hopes for future profits. He said, “We would be disappointed if we cannot at least double the size of the business in the next three to five years.”

Fascists try to whip up racism

The British National Party (BNP), the English Defence League (EDL) and other far-right racists tried to influence the Rochdale trial.

Now the EDL plans to march in Rochdale on 9 June. The BNP has threatened to march too.

One local Labour Party activist told Socialist Worker, “We are organising against them. We have to show solidarity with the Muslim community. The EDL and BNP want to exploit this situation and we must not let them.”

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