By Luke Stevenson & Tristan Donovan
Staff knew something was up. First came whispers of financial problems, then talk of restructuring but always caveated with upbeat ‘don’t worry, it will work out ok’.
Then came the unfamiliar visitors, who came to the offices for hush-hush meetings. The mystery visitors, staff discovered were from the children’s charity Coram, who – unknown to them at the time – would take over a significant chunk of BAAF’s work in England just a few weeks later.
“The way that we found out was because they had to sign into the office,” one former BAAF employee told Community Care. “People would Google their names because there were so many secrets about it.”
The truth emerged soon after. On Monday 27 July BAAF employees were told there would be redundancies and more would be revealed that Friday. It was a blow, but at least there would be time to job hunt during the consultation period they thought.
But what happened on Friday 31 July was a shock. That day the 37-year-old adoption and fostering charity entered administration and announced it was closing with immediate effect.
Of its 135 employees, 55 were told they were now working for Coram, which had taken over several BAAF services in England including the Adoption Register, its membership, publications and the Independent Review Mechanism.
Around 50 of those remaining were told they were now unemployed while in Scotland staff learned that the country’s adoption register and national adopter information helpline had been transferred to St. Andrew’s Children’s Society.
Meanwhile, the rest of BAAF’s operations in Scotland, Wales and Northern Ireland were to continue for “a brief period” while options for their future were explored.
“It was just quite shocking really,” one former BAAF employee says. “It was quite unbelievable that something like that could have happened, such a crash without any real understanding.”
In a statement issued that Friday, BAAF’s chief executive Caroline Selkirk blamed the closure on “significant changes and prevailing economic conditions”, adding: “We appreciate that this is a very challenging time for our dedicated staff and are committed to giving them as much support as is possible during this period.”
Not that those who found themselves out of work that day feel supported. “When we read that staff are being supported as much as possible, I would like to ask those responsible what support that is,” says one of the employees made redundant. “We are not even being offered references or anything. We were just told get out of the building and that’s it. So I don’t know what constitutes as being supported.”
Administrators Smith & Williamson say they will be assisting those made redundant in making claims for redundancy payments to the government’s National Insurance Fund, but those who lost their jobs feel bitter about how they were treated that day.
“For many years, the chairman has stated that BAAF’s biggest asset was its staff group, yet those very staff who had contributed so much to the adoption and fostering sector, and had been responsible for maintaining BAAF’s worldwide reputation, were either dismissed without notice or notified that they were transferring to a new organisation on 31 July,” says one former employee.
‘A perfect storm’
BAAF’s path to insolvency began at least a month and a half earlier. In a letter sent to the charity’s creditors by the administrators and seen by Community Care, BAAF contacted Smith & Williamson after “discovering that it was experiencing financial difficulties”.
On 15 June, the financial services company met with BAAF’s trustees and was asked to review the ailing charity’s options. The exact causes of its troubles remain unclear. The letter to creditors names BAAF’s pension deficit as its most substantial debt, but former BAAF employees say other factors were involved too.
One of these was the cost of implementing the IT security for the Adopter Access Pilot, which was to allow would-be adopters to see photos and videos of children who were up for adoption. While the security requirements were set out in the contract BAAF signed with the Department for Education (DfE) to deliver the service, former employees say the costs were proving prohibitively high.
Another factor may have been what one ex-employee calls “a very significant” drop in referrals to BAAF’s family finding service, Be My Parent, following the Munby judgment. Others speculate that there may have been a drop in demand for BAAF’s training services due to local authority cutbacks.
The Charity Commission, meanwhile, is “considering whether we have any regulatory concerns we need to address with the trustees”.
The administrators, however, are not saying any more about the difficulties that caused BAAF’s closure for now beyond the charity facing “a perfect storm of adverse issues”.
Andy Elvin, chief executive of fostering and adoption charity and former BAAF member organisation TACT, feels the issues don’t explain the suddenness of BAAF’s demise.
“It’s a shock and disappointment that such a long-standing charity could go out of business so very abruptly,” he says. “We think it was the pension liability but I run a large charity and I can see these things coming 18 months away. It doesn’t speak of good governance.
“You can see financially a reasonably long way into the future, particularly if like BAAF you’re a membership organisation. You can see the trends in training take up and membership. Those things are foreseeable quite a reasonable distance into the future.”
Services sold for £7
After reading Smith & Williamson’s review, BAAF’s trustees decided administration was the only option. Restructuring was ruled out as needing more time and money than BAAF had.
Ahead of formally entering administration, BAAF began talks with Coram about the charity taking over its services, an option the letter to creditors said should enable the administrators to recover around £932,000 of the money BAAF is owed by its debtors.
While Smith & Williamson’s review looked at several merger partners, Coram was regarded as the only “appropriate” option by BAAF’s trustees.
Offering BAAF’s operations on the open market was ruled out due to the sensitive nature of services such as the adoption register, the need for the DfE to approve the transfer of such contracts and the charitable nature of the BAAF’s operations.
But even a deal with Coram had issues. The letter to creditors says regulatory differences prevented Coram from taking on BAAF’s work outside England and that the extent of BAAF’s debts, especially its pension deficit, prevented a wholesale transfer of all services in England.
In the end Coram offered BAAF a total of £40,000 for a number of BAAF’s operations. Of this £34,993 was to pay for its stocks of historic publications, £5,000 for fixtures and fittings, and £7 for the services it took on, namely:
- Policy, research and development
- Independent Reviewing Mechanism in England
- Adoption Register
- Adoption Activity Days
- Southern training
These services have now been distributed to different parts of the Coram group of charities, including a new entity called CoramBAAF. “CoramBAAF will continue to operate as an independent membership organisation for agencies and individuals in the UK as well as services in research, policy and development, professional advice and professional development, publications and Adoption Activity Days,” said a Coram spokeswoman.
The Independent Reviewing Mechanism, meanwhile, is now run by Coram Children’s Legal Centre while First4Adoption, which is run by Coram and Adoption UK, is managing the adoption register.
Conflict of interest
However, the transfer of services to Coram has caused concern among adoption and fostering agencies that were members of BAAF. TACT’s Elvin, for example, is uneasy about BAAF services now being part of a group that includes another adoption agency.
“BAAF was an umbrella agency, Coram’s an adoption provider, so they are in the same space as us,” he says. “It doesn’t feel comfortable with, particularly the Independent Review Mechanism where we are being asked to hand over commercially sensitive information to a rival agency. I’m not sure the DfE has been well advised to allow these contracts to be handed over.
“Same with the adoption register. There’s the new charity Adoption Link that do an excellent job with matching. That seems like a more obvious fit because they are not an adoption provider, so there is no conflict of interest.”
The DfE told Community Care that it approved the transfer of these contracts because the priority was to “avoid delays in matching children already on the register with loving families”.
“BAAF has worked tirelessly on behalf of vulnerable children for over 30 years,” said a DfE spokesman. “We’re grateful for the crucial role they’ve played in our commitment to overhaul the adoption system so more children can find permanent families. We look forward to seeing their work continue under CoramBAAF.”
There are worries on the fostering side too. Stephanie Clay is the chief operating officer of PICS, which runs the fostering agencies Clifford House, Fosterplus, ISP and Orange Grove Fostercare.
“I’ve worked with looked-after children for around 25 years so BAAF has been part of my career for a very long time and I’ve always referred to BAAF for guidance, literature, information, forms, training and conferences,” she says. “My relationship with BAAF over the years has been with people who have extensive expertise around fostering so there are a number of questions I would want to ask.
“Coram are experts in adoption so how are they going to retain expertise in the fostering field? How are they going to retain that link with central government around fostering? How are they going to inform practice and work with partners to inform the changes in the literature around fostering and the research to inform our practice?”
Of the services that didn’t get transferred to Coram, little is known. Former staff are particularly concerned about BAAF’s therapeutic services, which they say provided support to “hundreds” of looked-after children and families in England. Smith & Williamson say they cannot comment on specifics about this service at this stage.
The situation in Scotland, Wales and Northern Ireland is no clearer. All the administrators will say is that they are working with the respective governments in these nations to “achieve a smooth handover of these services”.
While some BAAF services have been rescued and more may yet survive, those working in adoption and fostering feel the organisation’s collapse will do long-term damage to work with looked-after children.
“It’s important that we have an independent body that is able to support and influence best practice in fostering and BAAF was that body. I don’t know who is going to fill that gap,” says Clay. “There is going to be a longer term impact as we move through this year. Where do people now go for that research? We had one body we could go to, one place, one phone number, one membership.”
Harvey Gallagher, chief executive of the Nationwide Association of Fostering Providers, shares Clay’s concerns about the potential loss of fostering expertise. “Although Coram has taken this on, for me the reason BAAF’s publications were so good was the expertise behind them,” he says. “At BAAF there were all these experts around the country coming together and contributing to this knowledge and that for me is the key thing we’ll lose with BAAF.
“Now more than ever it’s needed because there’s a huge increase in care numbers year on year and the system is under pressure like it’s never been before. I hope Coram can fill the gap.”
Elvin feels that while BAAF’s demise lacked the controversy and eye-catching images of Kids Company’s fall, it will be the sudden death of BAAF that will have the greater impact in the long run.
“It’s a significant loss, they were a great repository of expertise. In terms of its effect on vulnerable children over a longer period of time, BAAF is the more worrying loss than Kids Company, far more worrying.”