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At least four out of five children in orphanages around the world have a living parent, a leading charity says.
November 24, 2009 / BBC News
In a report, Save the Children says some institutions coerce or trick poor parents to give up their children.
As a result, the report says, millions of children are put at risk through living in an institution, and face rape, trafficking and beatings.
Save the Children says resources should go into projects which support families so they can look after their children.
It also wants stricter monitoring of children's institutions.
The report says orphanages in some countries have become big business, with those who run them often receiving financial incentives from governments or well-meaning donors.
Parents who hand over their children to institutions may hope to give them a better future or believe they will be returned to them at 18.
But few are aware they are giving up all legal rights to their child, the charity says, and often adoptive parents do not know the true background of the youngster.
Save the Children says about eight million children are known to be living in orphanages and similar institutions around the world, but the actual number could be much higher as many are not registered.
The report says children have become "commodities" in a growing industry.
"Unscrupulous institutions are known to recruit children in order to profit from international adoption and child trafficking," the report says.
"This trend is exacerbated by the fact that many public and private care providers receive funding on the basis of the numbers of resident children in their care. They are, therefore, keen to maintain high head counts."
Report author Corinna Csaky added: "It is a myth that children in orphanages have no parents. Most are there because their parents simply can't afford to feed, clothe and educate them."
The BBC's Will Ross, in Kenya, says many children there have been forced on to the streets by poverty, the effects of HIV/Aids and last year's inter-tribal violence.
Institutions have sprung up to take in some of these children but there have been complaints of inhumane treatment and the government admits the homes are not always well run, our correspondent says.