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MPs slam care homes’ murky finances

The need to clean up the murky finances of the care home sector has been highlighted by MPs in a new report on social care.

The second report – Long-term funding of adult social care, published by the Levelling Up, Housing and Communities Committee calls, calls on Government to tackle tax avoidance in care. Looking at the issue of murky finances, the report also urges improved visibility of providers’ financial structures and to give service users more idea of what the price for their care covers.

Report witnesses raised concerns about possible financial foul play among care home operators. Among the concerns are the lack of rules, risky behaviour and lack of responsibility for continuity of care. MPs heard that providers could suddenly leave the market or change ownership, without penalty.

Workers employed by investment firms said they experienced exploitation, and corner-cutting in service delivery, due to profits being prioritised over care.

The MPs report also proposes reform of the market infrastructure. Among the recommendations are:

  • a dedicated focus on outcomes-based commissioning
  • greater fiscal devolution, through measures such as resetting business rates, and revaluing council tax
  • a new burdens assessment to determine the required level of local authority resource
  • additional and longer-term local authority funding aimed at sustainable local care markets
  • an end to differentiating between public and private care providers.

For workers, the report calls for:

  • a 10-year workforce strategy with a focus on parity of pay between the NHS and social care
  • extending the Infection Control Fund to support the current COVID-19 public health situation.

Commenting, Cllr David Fothergill, Chairman of the Local Government Association’s Community Wellbeing Board, said: “Social care has been facing an uphill battle for some time in terms of sustainable funding, the sector urgently needs financial support.”


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