N.L. children-in-care costs skyrocket

Newfoundland and Labrador's latest financial audit is raising eyebrows over the amount of money spent to house young people under state care, and the lack of paperwork documenting the services.

The annual cost per child ranged from $157,000 to $600,000 in 2009.

Auditor General John Noseworthy says the Child, Youth and Family Services Department, through Eastern Health, paid two private agencies — Caregivers and Waypoints — alone more than $10 million during the last fiscal year to provide living arrangements for the young people.

Many were children in temporary accommodations, such as hotels or other supervised arrangements, until long-term foster homes could be found.

"We're looking at a lot of money here, $10 million," Noseworthy told CBC News.

Noseworthy said the cost of providing the service has increased by about 350 per cent since 2005, from $3 million that year to $13 million in 2009. The cost is expected to rise to $17 million in 2010.

Noseworthy said he is also concerned that contracts went to the companies without being put to public tender.

"There should be some kind of public call or proposal," he said, "or something just to see if there's anybody else out here ready to provide this kind of a service, when you're talking this kind of money, and probably at a better price for government."

'May improve care'

Noseworthy said putting a contract up for public tender might also attract other companies or groups with the required expertise to deal with children in care, and might result in the children getting better care.

The auditor general went looking for paperwork to see why Caregivers and Waypoints got the work, but he said he couldn't find any.

"No contract on file. No documentation to show how the two service providers were ever selected," he said. "Nothing to show that the people providing those services are qualified."

Noseworthy said that as a result, Eastern Health, the health authority that handles the program, can't measure its effectiveness or competitiveness.

"They cannot conclude that people with the proper education and qualifications are involved in this. They can't determine that, they didn't do it. They might assume, but they didn't check," he said.

Eastern Health responded to the auditor general's concerns by saying those two companies were the only agencies able to provide all the services required and the health authority had no plans to call for public proposals.

Joan Burke, minister in charge of the Child, Youth and Family Services Department, which was created in 2009 to separate child-care services from health, told CBC News the solution is to find more foster-care homes.

"Not only do we not have a sufficient number of foster homes," she said, "there is no strategy out there about how we're going to get more homes. So, one of the challenges for the new department is to develop that strategy."