Unprecedented sector-wide coalition warns Chancellor half of all care provision will close

A coalition of 15 major organisations have united to warn the Chancellor of the “devastating financial collapse” facing social care.   
 
The social-care coalition – which includes the Local Government Association, Alzheimer’s Society, the GMB Union, and the Living Wage Foundation – warned that 50% of care homes, and 74% of the domiciliary care market will be financially unviable unless urgent funding is provided by Wednesday’s Comprehensive Spending Review.
 
The coalition also warned of the knock-on impact on the NHS, which would be left to care for hundreds of thousands of vulnerable older people causing a national health care crisis of unimaginable scale.
 
Already care providers – both care homes and domiciliary care – are withdrawing from local authority contracts due to unsustainable fees being paid. The introduction of the National Living Wage, rising registration costs and other inflationary pressures will lead to a £2.9 billion black hole for social care by 2020.  
 
In particular, many smaller family-run care home providers are facing closure due to the lack of funding in the care sector and increasing staff and registration costs. Eighty per cent of all residential care is delivered by smaller providers who are at the greatest risk of closing.
 
Professor Martin Green, chief executive of Care England, commented: “For too long the care sector has been chronically under-funded, stifling staff wages and undermining investment in services. Faced with increasing costs and falling fee levels, many smaller care providers will go to the wall, jeopardising the care of thousands of vulnerable older people.
 
“Already providers are handing back local authority contracts and closing services – this will only get worse, with 50% of homes being financially unviable once the National Living Wage is introduced.
 
“We call on the Chancellor to properly review the funding of the care sector in the Comprehensive Spending Review to ensure that the care sector can continue to provide the care that hundreds of thousands of Britain’s older and disabled people expect and deserve.”
 
Mike Parish, chief executive of Care UK, said: “Half the care homes in the country will be loss making with the introduction of the National Living Wage. We are not asking the Chancellor to pay our staff's wages; we are saying that local authorities must be able to pay the necessary and fair fees to keep these homes open.
 
“We're seeing a rapidly emerging two tier care system – if you can pay you can live in a beautiful care home and receive excellent care; if you can't pay you're increasingly at the mercy of shrinking budgets and loss making homes.
 
“I'm deeply uncomfortable with this growing unfairness in social care.”

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