Care home fees crisis reaches a climax

    The campaign by the independent care home sector to get local
    authorities to increase the fees they pay has reached crisis point,
    with some homes threatening residents with eviction. Jonathan
    Pearce reports.

    A frog thrown into boiling water will immediately jump out, they
    say. But if one is placed in cold water, which is then brought to
    the boil, the frog will do nothing to save itself.

    For the pan of boiling water read the independent care home
    sector, and for the frog, the care home owners. The market in the
    sector is almost at boiling point and, although many home-owners
    have already found the temperature unbearable, many more have yet
    to jump out of the pan. However, there is a twist in the story –
    this time the frog has got a gun and taken a hostage.

    Across the UK, private and voluntary care homes are rebelling
    against local authority fee levels which they claim are forcing
    them out of business. The hostages are the council-sponsored
    elderly residents in long-term care who are now threatened with

    In a move mirrored in other areas, Evedale Care Home in Coventry
    has issued the council with an ultimatum: increase the fees or 38
    residents will be evicted on 15 July.

    “Holding a gun to the head of older people is not in anyone’s
    interests,” says a council spokesperson. Maybe not, but with
    similar actions taking place in Devon, Birmingham and Scotland it
    speaks volumes about the state of the sector.

    Although not all the care homes are taking this line, some
    councils are being forced to make contingency plans to deal with
    the threat of evicted residents, while hoping that negotiations
    will prevent care homes taking such desperate measures.

    Despite claims of distorted truths and militant activity, there
    are some simple facts underlying the crisis. First, the sector is
    in meltdown, having grown successfully and profitably out of a
    Thatcherite boom in the late 1980s and early 1990s. For decades the
    closure of long-stay institutions and the elimination of geriatric
    wards kept the market buoyant. Now it is struggling.

    Figures from leading sector analyst Laing and Buisson suggest
    that more than 1,500 care homes have closed over the past two
    years, representing a loss of approximately 16,000 places each
    year. The figures are offset by some new home registrations, for
    instance 145 new homes opened last year offering about 5,000

    The reasons behind the closures are varied, depending on
    individual situations and local economies. Devon is a case in
    point. About 50 nursing home-owners have given Devon Council seven
    days’ notice before terminating the contracts of council-sponsored

    Devon’s director of social services David Johnstone is pragmatic
    about the crisis. “The public sector can’t bail out bad economic
    decisions [by home-owners],” he says.

    He sympathises with the plight of the care homes, but believes
    such threats undermine the progressive work going on elsewhere in
    the county to develop new services.

    Some homes will close because they are not economically viable,
    he claims, or have not invested properly. The ones that survive are
    the ones that recognise the way the market is moving. So that means
    a wider mix of services – such as outreach services, day-care
    provision, more investment in caring for the elderly mentally ill –
    and a shift away from traditional full-time residential and nursing

    Each part of the country has a different story to tell, but they
    all operate against a background of government policy which has put
    the sector through a period of transition.

    National care home standards, which come into force next year,
    mean owners have to upgrade their properties to comply.
    Improvements to employees’ rights in recent years, such as the
    national minimum wage and the working time directive, have also
    increased staff costs.

    In addition, the government wants to promote the independence of
    older and vulnerable people, giving them more choice in how they
    are cared for and where, leading to an increase in sheltered
    housing, domiciliary care and direct payments to clients. On top of
    this, last year’s NHS Plan developed the concept of intermediate
    care, with the aim of reducing unnecessary hospital admissions,
    limiting stays in care homes and getting people back home. However,
    all this is happening without any significant increase in the
    funding of long-term care.

    “We can no longer deliver quality of care at these ridiculous
    prices,” says Barry Giddins, chair of the National Care Coalition –
    an umbrella organisation of private care associations and
    home-owners. “We have tried for two or three years to talk to
    social services, but they haven’t listened.”

    He sends out a stark message to local authorities: “If you don’t
    work with us soon, then you won’t have to, because we won’t be
    here.” The NCC is in the vanguard of the campaign against local
    authority fee levels – particularly the fact that many councils pay
    far higher fees to their own homes.

    There are several responses to the independent sector’s cry of
    “unfair”. The first says the two rates cannot be directly compared.
    The local authority rate is a “unit cost”, while the independent
    sector rate is a “price”.

    According to accounting formulae, such unit costs must take into
    account a relevant proportion of all the local authorities’
    overheads and salaries, even though some of these might not be
    directly related to the council care homes in question, thus
    inflating the unit cost.

    The second argues that local authority staff are better paid –
    an historical circumstance borne out of trade union organisation in
    public sector services.

    A third suggests that councils’ own homes only provide about 15
    to 20 per cent of the total care provided, and that this is driven
    by the fact they care for the more vulnerable clients with high
    support needs that the independent sector is not interested in.
    Such care inevitably costs more.

    Home-owners refuse to buy these arguments, claiming local
    authorities are simply running a care market monopoly. Not so,
    claim the directors of social services. They are simply trying to
    manage the market.

    Social services departments spend a massive amount of money
    purchasing care – often a half or two-thirds of their annual
    budgets. The stark choice lies in paying less for more people or an
    overcrowded NHS picks up the overspill.

    “At the root there is the argument that government has not got
    enough money to purchase the care it needs,” says Middlesbrough
    director of social services Glenys Jones. She attributes many of
    the problems in the care home sector to “wobbles in the market”
    caused by public policy shifts – which are right in principle, but
    lacking in money – and economic changes, such as rising property
    prices and increasing employment.

    High property prices allow home-owners to sell up while the
    going is good, while high employment makes it hard to recruit
    staff. “If people have a choice, then they would rather not wipe
    bums,” she says.

    Interestingly, local authorities in England and Wales have
    looked at running care homes and have independently decided they
    want out – mainly because they cannot afford to meet the new
    standards. “It’s primarily about local authorities not having the
    capital [to invest],” says Jones.

    Scotland has a similar problem, but has approached it
    differently. Scottish Care – representing 800 of the 1,100 private
    care and residential homes in the country – recently met with the
    Scottish executive to discuss funding problems and fee levels.

    Estimates from Scottish Care and the Association of Directors of
    Social Work put the country’s funding shortfall at between £25
    million and £50 million, if care standards are to be

    There has been some talk of evicting council-sponsored residents
    from homes, but this has not emerged as a major threat just yet. In
    Scotland, the issue is seen as one for central government, with the
    Scottish executive stepping in to set up a “short-life working
    party” to review fee levels and report within about three

    This contrasts with the Westminster approach which puts local
    authorities in the firing line, while simultaneously developing a
    concordat with the private sector on long-term care.

    It is unclear exactly what is on the table at the moment, but
    the concordat aims to stabilise the industry by improving
    commissioning arrangements between local authorities and care

    In Scotland, public services are seriously defended and there is
    little talk of anything like public-private partnerships, private
    finance initiatives or the involvement of the newly created care

    It all boils down to definitions and funding of free nursing and
    personal care and how much will transferred to local authorities in
    preserved rights benefit payments from the Department of Social
    Security for pre-April 1993 residents. All these are unanswered
    questions both north and south of the border – with the exception
    of free personal care in the south.

    Whatever the mechanics of resolving the sector’s problems, two
    fundamental facts will not go away: the population is ageing
    rapidly and long-term care is seriously underfunded.

    Local authorities may not be perfect purchasers of care, but
    neither is the independent sector a perfect provider. Both are
    hampered by a short-term view on how their finances are run. The
    care homes need investment, while local or central government needs
    to invest in the care home sector to ensure the elderly and
    disabled are properly cared for.

    If councils could raise capital, then the story might be
    different. There may be potential in care trusts for the
    development of a different model of public sector provision.

    As Middlesbrough’s Jones says: “It’s about managing this
    transition in a way which is least painful for everyone.” Including
    the frogs.


    Judges take a firmer grip of care plans

    More confusion, work and delays in implementing care plans may
    result from a Court of Appeal decision to give family courts
    greater powers, reports Alex Dobson.

    Social workers dealing with children and families often suspect
    the legal framework within which they operate is far from perfect.
    But a landmark decision in the Court of Appeal could mean more
    delay and confusion for professionals and families.

    The judgement, concerning Torbay and Bedfordshire councils is
    the first to connect the “right to a family life”, enshrined within
    the Human Rights Act 1998, to the plans drawn up by local
    authorities for children at risk.

    The Court of Appeal’s decision, which some have hailed as a
    rewriting of the Children Act 1989, may yet be subject to a
    challenge in the House of Lords. But in practice, it could mean
    councils must implement care plans made when a care order is
    obtained or face the prospect of being taken to court to explain
    why things have gone wrong.

    Social workers will, in future, need to alert the court if
    planned developments fail to materialise, such as when a planned
    family reunion or a scheduled adoption does not go ahead.

    The upshot is that judges will in future have much more freedom
    to intercede, to demand more information, and in some cases to
    refuse to make a care order at all.

    While the number of cases directly affected is likely to be
    small – some observers suggest as few as 200 per year – there are
    likely to be a number of knock-on effects.

    Social workers’ time, already in short supply, could be
    stretched to breaking point by the demands of a number of complex,
    lengthy court cases. And courts, for their part, could choose to
    err on the side of caution, resulting in an increased use of
    interim care orders.

    Jane Held is vice-chairperson of children and family services
    for the Association of Directors of Social Services, and director
    of social services in Camden. She says: “There could be problems
    because there are already long delays in some parts of the country
    in the court process. The decision has echoes of the old wardship
    jurisdiction of the courts which is something that we moved away
    from when the Children Act was passed.”

    She says it is crucial to keep the child’s best interests as the
    focus and to avoid the sorts of delays that can impact negatively
    on a child’s life. “We know that it is essential that we work
    quickly. It looks like the effect of the decisions may be to slow
    down the system even more.

    “One of the impacts could be to take frontline social workers
    away from the work they are doing with vulnerable children and
    their families.”

    According to human rights lawyer Bernadette Livesey, a key issue
    will be deciding what amounts to a “fundamental failure” of the
    care package. She warns that challenges in future could come from
    many sources.

    “There are going to be disputes over what is considered to be
    important,” she explains. “Aggrieved parents may feel that one
    aspect of the care plan is vital, or guardians ad litem may feel
    that there are aspects that are essential to its success. The local
    authority may take a completely different view, and the child may
    take yet another view. All of these people now have an expectation
    that they may be able to go back and have the position reviewed,”
    she says.

    As Livesey points out, this is at odds with the messages from
    the Lord Chancellor’s department which has warned that care
    proceedings are taking too long, and recommends that decisions
    concerning children should be made as quickly as possible.

    But others welcome the move. Robert Tapsfield of the Family
    Rights Group says that, until now, parents have been unable to
    challenge changes to the care plan. To date, their only option has
    been to apply for a revocation of the plan.

    “They have no rights if the care plan is changed by the council,
    or where there is a failure to carry out all or part of the plan,”
    he adds. “We welcome any move that allows parents to question how
    the lives of their own children are affected by the decisions that
    are made.”

    Tapsfield argues that, while these decisions seem to be eroding
    local authorities’ unfettered discretion under the Children Act, it
    is absolutely essential that parents are able to challenge and ask
    for a hearing where their views can be heard.

    He says that prior to the judgement, where care plans have not
    been applied in full because of budget constraints or staffing
    shortages, parents had been “denied fundamental rights”.

    Lawyers who brought the cases in the Court of Appeal say that
    the decisions will concentrate the minds of some local authorities
    who until now have been able to drag their feet with impunity.

    They suggest, too, that judges are not rewriting the Children
    Act, but interpreting the provisions so that they are compatible
    with the Human Rights Act 1998 and the UN Convention on the Rights
    of the Child.

    The changes triggered by the test cases may not be actually
    spelt out within the Children Act 1989, but neither are they
    prohibited, the lawyers argue, welcoming some degree of return to
    the old wardship jurisdiction of the courts.

    The judgement also means, they add, that failings that have
    become apparent since the arrival of the Children Act can be

    The ultimate test of the court cases is whether they will result
    in added benefits for children and families, and on that the jury,
    if not the judges, are still out.

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