Nursing Homes Say National Audit Office Has Confirmed Their Worst Suspicions About Government Funding Cuts For Elderly Care

A new National Audit Office (NAO) report has confirmed suspicions about the extent of real terms cuts in the fees paid by local authorities towards the cost of caring for individuals who qualify for public funding, the Registered Nursing Home Association (RNHA) said today.

Commented RNHA chief executive officer Frank Ursell: “The National Audit Office has calculated that between 2009/10 and 2013/14 the rates that local authorities pay for care home places increased by 5% less than the costs incurred, with around half of all directors of adult social services admitting that care homes in their areas are facing financial difficulties.”

He added: “The NAO has also confirmed another scandal created by the cuts in government grants to local authorities that have in turn led to cuts in the value of fees they pay to care homes. Its report highlights the fact individuals who have to meet the care costs out of their own pockets end up paying more than the local authorities are paying for those who qualify for public funding. This enforced cross-subsidisation is wrong – yet further evidence of the negative impact of current government policies. “The NAO acknowledges that some local authorities do try to take account of care homes’ costs when setting their fees, which means that some do not. A number of recent court judgements in different parts of the country have found that this is unlawful. So we have a situation in which government cuts in public expenditure are forcing some councils to break the law by turning a blind eye to the economic realities of providing care. What a tangled web this is, and what an indictment on the whole system of funding.”

Responding to a recent Low Pay Commission recommendation for an increase in the national minimum wage from October 2014, the RNHA has welcomed the Commission’s call on the government to increase funding to the social care sector by 3% to help meet the cost of the increase.

Said Mr Ursell: “We think it is very telling that the Commission should be encouraging the government to do this. Yet again, another public body has seen fit to draw public attention to the funding shortfalls faced by care providers.”

He concluded: “How, logically, could the government tell us in one breath to pay our staff more whilst councils tell us they’re going to pay us less? Unless ministers grasp this conundrum, there will be even darker storm clouds ahead for elderly care in this country than there are already.”