Britain’s biggest care home group is closing three of its homes putting over 150 jobs at risk because they are ‘operating at a loss’.

Four Seasons Health Care, which owns 470 homes with more than 20,000 beds, is closing three homes in the Birmingham area which could lead to 162 members of staff losing their jobs.

‘Each of the homes is operating at a loss and has been for some time,’ explained Rachael Junge, the Four Seasons regional managing director.

‘The number of residents living in each home is well below its capacity.’

Oaklands, located in Moseley, has 43 staff looking after 21 residents and a capacity of 36. Ivyhouse Care Home in West Heath has 74 staff looking after 45 residents and a capacity of 75. Finally, Heath House has 45 staff and 29 residents. Its capacity is 45.

The Four Seasons Health Care Group has been facing financial difficulties because of what the chairman Robbie Barr described last May as ‘the under-funding of social care’.

As the MJ reported, earnings before interest, taxes, depreciation and amortisation for Four Seasons was £38.7m last year, compared with £64m the previous year.

Ms Junge also said Oaklands and Heath House required ‘substantial investment’ to modernise them, and Ivyhouse was having difficulties recruiting and retaining staff.

Four Seasons is in a consultation process with the staff and unions about the proposed closures.

‘We will consider applications for staff to transfer to our other homes in the area, subject to there being suitable vacancies,’ said Ms Junge.

Responding to the news of the closures, Alan Lotinga, service director for Adult Care and Housing Options for Birmingham City Council, said: ‘Birmingham Council will offer support to all residents, ensuring that the appropriate responsible authorities are contacted and assessments completed.

'Dedicated Social Workers will be assigned to the homes and will establish a drop-in surgery service to assist residents and relatives. This will make sure that we are pro-active and that Birmingham residents have the appropriate care and assist the smooth transition for those residents that are the responsibility of other neighbouring authorities.’

The number of care home insolvencies has jumped by 18% in recent months, as local authority spending on care homes continues to fall.