A very happy New Year to you all!
I will, for the next few posts, begin with urging you to signup to our new twice weekly newsletter. If you are not receiving a copy you can sign up here.
There are many significant issues dominating the care sector industry, but I think one of the most significant and looming is the introduction of the national living wage (NLW) coming this April. I am sure you already know that a minimum rate of £7.20 an hour will apply for workers aged over 25, rising to £9 in five years’ time.
Professor Martin Green of Care England wrote to the Chancellor, in August last year expressing deep concerns.
In very simple terms the introduction of NLW is set to cost the care industry up to £1 billion by 2020.
Who would not be supportive of a national living wage? It would be very difficult to look anyone in the face and attempt to argue why such an introduction would be wrong. However, facts are inalienable facts, and it is sometimes very easy to stand on a rostrum and issue crowdpleasing gestures when someone else is picking up the bill. Many operators operate at the very margins of profitability and the additional costs not only increased wages, but also an increased national insurance could simply push them into liquidation/closure.
A report by the ResPublica think tank revealed that a cash crisis facing care homes across the country could see a collapse of residential care within five years, costing the NHS an extra £3 billion annually as a result. This equates to a loss of 37,000 beds as funding fails to meet demand. Then it would be left to already underfunded national health service to step in and pick up the cost.
I did say in a previous editorial it is time to stop kicking the can down the road, and I note that Allied Healthcare have suggested raising the threshold at which care employers pay national insurance by £5,000, saying the move could save 15,000 care workers’ jobs.
To me this seems a logical and sensible approach, and one I very much hope is taken seriously.
We here at The Carer would once again welcome your views and comments on this highly contentious and imminent issue. So please feel free to contact us, and once again, we wish you all a very happy New Year!
Editor of The Carer