How can homecare companies operate a decent care service as local authorites force bidding down?


Care Industry NewsAs local authorities force down the value of care to £15 per hour or less a group of social care providers have vowed to continue in their fight to get fairer funding to look after older and disabled adults.

Over the last 25 plus years many social care providers have been forced into closure as local authorities use a ‘bidding down’ process. Yet there is a disparity between what local authorities force private companies to charge and what they charge via their own social services, when you take into consideration the costs of local authority staff (pensions, overtime, bank holidays etc.).

As a result a group of providers mounted a legal challenge against Herefordshire Council after it imposed an unacceptable maximum price which it then required local operators to bid below in order to secure business.

The providers argued that the maximum price of £13.98 per hour would not enable them to deliver safe or quality home care to people who used home care services in the area. They also argued that the council had not consulted properly over its decision to lower the maximum rate from what it had previously paid.

Although the High Court rejected the providers’ call for a judicial review of the council’s processes, the providers pledged to fight on.

A spokesperson for some of the claimants and providers, Mike Padgham, said:

“We may have lost the battle over this unfair price for care but the war on inadequate funding will continue.

“The fundamental issue goes far beyond pounds and pence. We are talking about being able to provide proper, safe and dignified care to older and disabled people who, frankly, deserve to be treated better in 2014.

“And we are talking about paying providers a fair and realistic rate that enables them to recruit, train and reward hard-working and committed staff to provide compassionate care.

“The consequences of repeated reductions in the price paid for care are obvious: Fewer people receiving care, a reduction in the quality of that care and operators being put out of business. That is the situation that, as a country, we seem intent on sleepwalking towards.

”Adam Hartrick, Partner at Hempsons Solicitors, who supported the providers with the challenge, said:

“Whilst the Court’s decision is disappointing it is specific to the facts as perceived by the Court to exist here; the fact is local authorities have a duty to consult and properly consider the costs of providing safe care to those in their own homes, just as they do when placing people in care homes and if they fail to discharge this duty, they should expect to be challenged: otherwise there will be a disparity in the quality of care people receive in their own homes as opposed to those in care homes. On what basis is that right?”

Aside from seeking the right for a judicial review against Herefordshire Council, the providers were also looking to draw a line in the sand for other local authorities.

Mr Padgham added: “A legal declaration would help to ensure that, when councils set prices for care services, they must take proper account of actual costs of providing care, consult properly and pay full regard to equality considerations.”

The providers contended that the council’s maximum price represented a figure of up to 18.4% below current market rates. They argued that the authority had not properly taken into account providers’ legal obligation to pay care workers the National Minimum Wage, cover travel, sickness and holiday pay, or to meet training and essential quality checks. They concluded that the council’s maximum price compromised their ability to provide a proper service and may have even risked service users’ safety.

They warned that the only way providers could bid below the council’s maximum price was by cutting costs, penalising their staff and putting the viability of their services at risk.

They also argued that not enough consultation was carried out before the new ceiling was imposed. This, they argued, denied the providers any opportunity to give feedback on the proposed ceiling and the impact it would have.

Speaking on behalf of the national association for homecare providers, Colin Angel of United Kingdom Homecare Association said:

“This case highlights two recurring issues: councils cutting costs to an unsustainable level and taking advantage of their dominant purchasing power to the point where local homecare providers can be forced to use the courts as the final form of redress.

“These care providers are fighting for important principles: sufficient funding to deliver safe, dignified care which also meets the legal requirements of at least the National Minimum Wage for their workforce.”

Care Industry News says ‘Not only does this case highlight local authorities needs to cut costs via it’s most vulnerable but it also shows that the High Court is out of touch with the cost of care and the cost of running a business that enables its staff to deliver decent care; that it’s allowed this authority to continue to underserve it’s own residents.’


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