A new report by the House of Commons Public Accounts Committee (PAC), published on 16 January 2026, has raised serious concerns about the state of children’s residential care in England, warning that the system is “not working” and is placing vulnerable children at risk.
The report Financial Sustainability of Children’s Care Homes found that in September 2024 nearly 800 children were living in illegal, unregistered children’s homes or supported accommodation, often placed for an average of six months, rather than on a short-term emergency basis.
These findings have clear relevance for Harrow. Published written evidence submitted to the PAC by the Harrow Monitoring Group highlights how national failures in the system are experienced locally. Like many London boroughs, Harrow faces a shortage of suitable local placements, increasing the likelihood of children being placed far from home or moved repeatedly between care settings.
The PAC report also draws attention to the rising cost of children’s residential care. Spending has almost doubled in five years to £3.1 billion in 2023–24, with average costs per child exceeding £318,000 a year. The Committee links these escalating costs to a dysfunctional market, where local authorities compete for scarce placements and where poor matching and instability drive further expense.
In its submission, the Harrow Monitoring Group highlighted the role of Independent Reviewing Officers (IROs), whose statutory responsibility is to ensure children’s needs are properly assessed, and that placements remain suitable. While Harrow’s IROs carry out their statutory duties and raise concerns, the Group’s evidence shows that wider systemic problems – including weaknesses in assessment quality, shortages of appropriate placements, and commissioning constraints – limit the impact of IRO challenge. As a result, unsuitable placements may remain in place, leading to placement breakdowns, disrupted education, reduced family contact, and rising costs over time.
The Harrow Monitoring Group notes that many of the PAC’s conclusions closely reflect the concerns raised in its own written evidence. In particular, the report substantively takes up the Group’s core arguments on the suitability of placements, the limits of oversight, failures in escalation when care arrangements break down, and the cost consequences of instability and poor matching. While the PAC presents these findings at a national level rather than attributing them to individual local authorities, the report strongly validates the issues identified in Harrow.
The Committee issued a series of recommendations, including a commitment to end the use of unregistered homes by 2027, stronger oversight of provider profits and debt, improved regional planning of placements, and more effective action to increase foster care capacity.
For Harrow, the report reinforces concerns long raised by local residents and community groups: that improving the suitability and stability of placements is essential not only for children’s wellbeing, but also for achieving value for public money. Without better assessments, stronger oversight, and sufficient local provision, costs will continue to rise while children face avoidable disruption and instability.
Commons report: Financial sustainability of children’s care homes
The report Financial Sustainability of Children’s Care Homes found that in September 2024 nearly 800 children were living in illegal, unregistered children’s homes or supported accommodation, often placed for an average of six months, rather than on a short-term emergency basis.
These findings have clear relevance for Harrow. Published written evidence submitted to the PAC by the Harrow Monitoring Group highlights how national failures in the system are experienced locally. Like many London boroughs, Harrow faces a shortage of suitable local placements, increasing the likelihood of children being placed far from home or moved repeatedly between care settings.
The PAC report also draws attention to the rising cost of children’s residential care. Spending has almost doubled in five years to £3.1 billion in 2023–24, with average costs per child exceeding £318,000 a year. The Committee links these escalating costs to a dysfunctional market, where local authorities compete for scarce placements and where poor matching and instability drive further expense.
In its submission, the Harrow Monitoring Group highlighted the role of Independent Reviewing Officers (IROs), whose statutory responsibility is to ensure children’s needs are properly assessed, and that placements remain suitable. While Harrow’s IROs carry out their statutory duties and raise concerns, the Group’s evidence shows that wider systemic problems – including weaknesses in assessment quality, shortages of appropriate placements, and commissioning constraints – limit the impact of IRO challenge. As a result, unsuitable placements may remain in place, leading to placement breakdowns, disrupted education, reduced family contact, and rising costs over time.
The Harrow Monitoring Group notes that many of the PAC’s conclusions closely reflect the concerns raised in its own written evidence. In particular, the report substantively takes up the Group’s core arguments on the suitability of placements, the limits of oversight, failures in escalation when care arrangements break down, and the cost consequences of instability and poor matching. While the PAC presents these findings at a national level rather than attributing them to individual local authorities, the report strongly validates the issues identified in Harrow.
The Committee issued a series of recommendations, including a commitment to end the use of unregistered homes by 2027, stronger oversight of provider profits and debt, improved regional planning of placements, and more effective action to increase foster care capacity.
For Harrow, the report reinforces concerns long raised by local residents and community groups: that improving the suitability and stability of placements is essential not only for children’s wellbeing, but also for achieving value for public money. Without better assessments, stronger oversight, and sufficient local provision, costs will continue to rise while children face avoidable disruption and instability.
Commons report: Financial sustainability of children’s care homes
Harrow Monitoring Group 