The sexual abuse by the gang uncovered in Rochdale is horrific enough, and made worse by the abject failure of the police to respond to pleas for help from the teenage victims over several years, but questions have naturally been asked about how such young girls could have been preyed on so extensively when they were in care. The answers now beginning to emerge cast a frightening light on the breakdown of social care for children, which parallel a similar breakdown of social care for the elderly in the case of Southern Cross last year. What links both cases is the manner in which private equity exploited its financial interests with complete disregard for its caring responsibilities.
One of the Rochdale victims was living, we now know, in a care home owned by a company within the Continuum Care and Education group which was itself owned by a collection of investment funds run by private equity group 3i. The latter was set up after the Second World War to provide finance to industry, but is now a regular private equity outfit run by New Labour PFI guru, Sir Adrian Montague.
As typically happens with private equity, Continuum was after a few years with 3i then sold on to another company, Advanced Childcare Ltd. This outfit, it turns out, is owned via an offshore company by funds managed by a US private equity group called GI Partners. The latter advertises its financial ambitions as “achieving superior returns by unlocking value obscured by complexity and market dislocations”. That might seem somewhat remote from the necessary task of providing decent homes for troubled children.
This is the reality of privatisation, squeezing local authority budgets to the point where they are forced to hand over the care of highly vulnerable individuals to finance-driven whizz kids with no sensitivity or interest in care needs. Similarly, Winterbourne View, the Bristol care home exposed last year abusing residents with learning disabilities, was part of a Swiss private equity operation.
This is a much bigger issue than simply Rochdale, Winterbourne or Southern Cross. The combination of social care for vulnerable people unlikely to complain with the anonymous ruthless world of private equity driven solely by leveraging maximum financial returns is a toxic and dangerous mix. There urgently needs to be a public inquiry into the full implications of this latest escapade of unregulated profiteering as it generates one scandal after another in the social care of the elderly and disabled and now highly vulnerable children.