Life in the care capital of Britain, where children are left hundreds of miles from home

Known mainly for its theme park, rock and donkey rides on the beach, Blackpool is still a beloved holiday destination for millions.

Blackpool is also the children's home capital of Britain, where one in 52 children are currently in care. Private companies are snapping up cheap housing stock in one England's poorest towns to maximise profits for shareholders and investors.

And with a chronic shortage of places elsewhere they can hold councils to ransom some charge up to £10,000 a week to look after a single child, according to the Local Government Association. Vulnerable kids end up hundreds of miles away from friends and family, cut off in a town already struggling with criminality, social problems and crumbling services. Matt Roper investigates.

As she stands in front of the imposing red brick children's home, Jade Barnett is bombarded by painful memories. "I used to run away down that street." She points. "I used to hide my bag in someone's shed, ready for when I got the chance to run away. Or I'd go over to the sand dunes over there and cry. I felt so far away and I missed my family and friends so much."

It is the first time Jade has returned to the Fylde children's home where she was sent 260 miles away from everyone she knew aged 15, reports the Mirror.

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Jade is a casualty of a care system that sees kids like her as a lucrative source of revenue while private companies shamelessly cash in on children's misery.

Councils spent £1.8billion on placements in private children's homes last year, the Local Government Association says. Yet while their owners and investors make millions, the firms are often criticised for not even providing the basics for kids in their care.

There are 34 children's homes in Blackpool. So many are set to open there that the council has brought in new distancing rules of at least 400 metres between them.

All but one are operated by private companies, drawn to the area by cheap property and labour. Most are owned by foreign and private equity firms linked to offshore tax havens.

This concentration in Blackpool which has the highest rates of sex offences and of deaths linked to alcohol, drug abuse and suicide in England, according to the latest crime data is something Ofsted says needs to be "urgently resolved".

A spokesman for the watchdog said: "We have long been concerned about the uneven distribution of children's homes across the country and the impact this has on children especially those with complex needs who are sent to live far away. While the number of children's homes continues to rise, they are often not located in the right places or offering the specific care children need." The home where Jade spent 18 months isrun by private firm Cambian, it was blasted by Ofsted last year as "requires improvement to be good".

Inspectors found one child sleeping on a soiled mattress, one without a coat and another without "suitable footwear". Their report added: "Children do not always feel able to share their views, as they say they do not think they will be listened to or that their concerns will be acted on."

Jade, now 23, originally from Lewisham, South East London, believes little has changed since her day. She says: "I felt lied to by the social care system because I was told I would only be there for two weeks." Jade believes no consideration was given to her background or cultural needs. She says: "I was the only Black person in my school. I felt like I stood out when I was on the street. I couldn't get the hair and skin products I needed and the home said they didn't have the extra money to buy them. It scared me to see crackheads everywhere, smoking on street corners... in front of where we were living."

Police forces warn that county lines drugs gangs and child sexual exploitation rackets are increasingly targeting areas where there is a large population of looked-after kids and Jade says she saw children in her home fall into drug addiction.

She recalls: "Some young people in my care home would go out and use drugs, which was shocking for me. One boy always seemed to be high. He'd go missing for days."

Philip North, the Bishop of Burnley whose diocese covers Blackpool, is deeply concerned about the effect being brought to the town has on children in care.

He says: "The huge increase in care homes in Blackpool is not because Lancashire children are going into care, but because [of] the privatisation of the sector and the town's cheap property and labour. We're commodifying the nation's most vulnerable children. It is profiteering and it is a scandal. You end up victimising those children and destroying their life chances because they are being lifted out of their schools and extended families and placed in a deeply alien environment where they are simply not going to flourish."

Katharine Sacks-Jones, head of the Become charity for children in care and care leavers, adds: "We know gangs target areas where there are a lot of children's homes with the intention of criminally or sexually exploiting them."

Yet while children are put at greater risk, the owners of Blackpool's private children's homes are getting richer. Cambian is owned by CareTech, a firm incorporated in the Caribbean tax haven of Nevis, while its holding company is wholly owned by a trust based in another tax haven, Guernsey. It's the UK's largest provider of children's homes, with contracts with over 300 councils.

In 2018 CareTech's owners, Kenyan-born brothers Farouq and Haroon Sheikh, shared £12m after floating the firm, retaining a £42m stake. In 2022 CareTech profits rose 14.6% to £68.2m. Accounts show it paid out £17.3m in shareholder dividends and handed execs almost £1m in bonuses.

Nine Cambian children's homes were judged "inadequate" by Ofsted last year, including one in Bolton, Greater Manchester, where "serious and widespread failures mean children and young people are not protected or safeguarded", and another in Dudley, West Mids, where a child "disclosed concerns that indicated they were subject to sexual exploitation".

A spokesman for CareTech said: "There are well-established and sound reasons for a local authority to place a child in any of our homes. We support all young people in conjunction with the placing local authority to have appropriate and agreed contact with their family."

The firm said "identified shortfalls" in its Lytham St Annes home were immediately corrected during the Ofsted visit. It said fees at that particular home are not £10,000 a week and its most recently published accounts showed an operating profit of 2.1%. The spokesman added: "To therefore assert that CareTech is profiteering is simply incorrect."

Other private providers in Blackpool include Sandcastle Care, owned by Dutch private equity firm Waterland, which runs 15 children's homes. Its most recent accounts show one director received £1.1m, including a £305,000 award. Ofsted rated one of its Lancashire homes "inadequate" last year, reporting "children are not adequately protected due to the safeguarding failings". Waterland was contacted for comment.

Another firm, Care 4 Children renamed Your Chapter last year showed profits rising from £1.7m to £2.2m. One of its Lancashire homes was rated "inadequate" in October after inspectors reported that on one occasion, children did not have enough food to eat.

Another shut after Ofsted noted kids were not provided with essential toiletries and hygiene products and described holes in walls and doors.

Your Chapter said: "We acted quickly to ensure that children were safe and took the decision to close the home to enable corrective work to be done. We are proud of our record of providing high quality services for vulnerable children and have a profile of 90% 'good' or 'outstanding' across our residential homes and... schools."

Jade, who turned her life around despite her experiences in Blackpool, says the care system needs to change. She adds: "I feel glad that I managed to get out, and I turned out all right. Not everyone will be so lucky."