A child may be looked after very well physically in an orphanage (though many are not), but it is not the same life as living in a family. When asked, children in orphanages simply want to live a normal life, in a family like other kids. No child wants to be labelled for life as an orphanage kid. A lot of studies show the harm done by placing children in orphanages. Family life is a child rights issue as well, but the simple truth is that an orphanage is no place for a child.
Many people who have built, volunteered at or who have managed an orphanage are the strongest advocates against using orphanages as a form of childcare. Many well-meaning people who support orphanages love and draw strength from their own families and their own children, and yet unwittingly they support a system that separates other children from their families. It is a verifiable fact that in most cases 80% of children in orphanages have a living parent, or two.
In fact, we usually find that 90% of the children in orphanages have parents, aunts, uncles or grandparents who they could live with, with a little bit of support. It is a lot cheaper to support a child at home with their family than in an orphanage. An orphanage may seem like a nicely boxed solution to child poverty, but it fails on two counts. First, most of the children placed in orphanages are not orphans. Secondly, an orphanage is not a solution, it just prolongs the problem.