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The quality of care provided by contracted residential agencies that housed more than 1,000 children in government care in British Columbia last year is unknown, and the provincial government has no strategy for using the services, says a new report by B.C.'s Auditor-General.

The report, which follows a string of reviews from B.C.'s child watchdog office that flagged problems in the sector, found a host of problems, including lack of oversight of contracts with service providers and a system in which social workers struggled to find placements that would match the needs of children.

Katrine Conroy, B.C. Minister of Children and Family Development, said the province accepts all four recommendations in the report and has already begun to make changes, which the Auditor-General acknowledged in her report.

The Auditor-General’s findings are disappointing, but not a surprise, said Jennifer Charlesworth, B.C.'s Representative for Children and Youth.

“This has been known for a long time,” Ms. Charlesworth said on Wednesday, noting that before being named as representative in 2018, she had co-authored an extensive review of residential care that was presented to the province in 2011.

“For me, one take-away is heartbreak – here we are, we continue to have these conversations. And that’s a lot of young people who have been served, and perhaps not well-served, in the intervening period," Ms. Charlesworth said.

Auditor-General Carol Bellringer said the children’s ministry has not set sufficient quality standards for contracted agencies and that it is struggling to match children’s needs to appropriate placements. She added Indigenous children were being placed in homes without an Indigenous cultural component.

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As of March 31 of last year, there were about 6,700 children and youth in care in the province. Of those, about 1,150 had spent time in residential care, the report said.

Arc Programs executive director Shane Picken on Wednesday said he hoped the Auditor-General’s report would lead to more funding allowing operators to hire more staff and increase wages.

Mr. Picken, whose company operates five homes in the B.C. Interior, said many of the children housed by his agency have behavioural problems, including aggression, and that well-trained, qualified staff are important.

“It’s difficult to keep them and staff safe,” Mr. Picken said.

Rick FitzZaland, executive director of the Federation of Community Social Services of B.C., whose members include contract care agencies, said his group welcomed the report.

“It echoes the [other] reports over the years. … I’m glad the Auditor-General has highlighted it; it’s more difficult for the government to ignore a report by the Auditor-General,” Mr. FitzZaland said.

In June, 2018, former children’s representative Bernard Richard issued a public statement raising concerns about contracted residential agencies, noting a review the previous month had resulted in the ministry relocating 18 children and youth after reports that a staff member was gang-affiliated, took a youth on drug drops, had smoked marijuana with the youth and offered him cocaine.

An investigation found just 10 of 33 staff and caregivers had completed criminal record and other security-screening criteria, Mr. Richard said at the time.

Mr. Richard’s predecessor, Mary Ellen Turpel-Lafond, also flagged concerns about contracted service providers in several reports, including a 2014 document that concluded children were being placed in inappropriate settings “with negative and sometimes tragic outcomes.”

In a statement Wednesday, Ms. Conroy noted several changes under way, including background checks on more than 5,800 workers, a 2018 moratorium on new agencies and checks to ensure children were placed appropriately.

Asked how much government investment might be needed to address the problems outlined in the new report, Ms. Charlesworth said the first step should involve getting a better understanding of existing needs and services.

“There is a tremendous amount of money being spent and we don’t know what the outcomes are,” she said.

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