Thomas Bridge 20 August 2015

Major care home provider could ‘collapse’ under living wage pressure

Care leaders have warned introduction of the National Living Wage could cause a ‘catastrophic collapse’ in the sector within the next year.

Five of the UK’s biggest care home providers and representative body Care England have written to chancellor George Osborne to say the pay rise could cost the sector £1bn by 2020.

Government plans would see workers aged over 25 paid a minimum of £7.20 an hour from April next year, rising to £9 in five years’ time.

Employees are thought to account for more than 60% of the cost of care, rising to 80% for more complex cases.

Four Seasons Health Care, Bupa, HC-One, Care UK and Barchester said they supported the National Living Wage but called for government support to ensure the rise in costs is covered.

With care homes in England currently looking after more than 400,000 older people, the collapse of a major provider could place significant pressure on the NHS as vulnerable people seek new support.

Martin Green, chief executive of Care England, said: ‘The care sector welcomes the National Living Wage and has long campaigned for it to be introduced. However, it is not sustainable for us to meet the increased cost of care when local authorities are already paying well below the true cost of delivery.

‘We want to work with the Government to find a solution that will ensure the 400,000 people the care sector supports can continue to live in a safe and comfortable environment in their older years.’

A government spokesman said: ‘The National Living Wage will benefit hundreds of thousands of care workers who will see their pay increase.

‘The overall costs of providing social care will be considered as part of the spending review later this year and we are working with the care sector to understand how the changes will affect them.’

SIGN UP
For your free daily news bulletin
Highways jobs

Registered Building Inspector (Band 2/Grade 7)

Health and Safety Executive
£60,760 - £65,776
The Building Safety Regulator (BSR) is transforming building safety regulation across England. United Kingdom / various Locations
Recuriter: Health and Safety Executive

Revenues and Recovery Team Leader

Ashfield District Council
£37,938 - £40,476 per annum (pay award pending)
We have an exciting opportunity for a Revenues and Recovery Team Leader Sutton-In-Ashfield, Nottinghamshire
Recuriter: Ashfield District Council

Housing Options Officer

Ashfield District Council
£31,067 - £33,366 per annum (pay award pending)
Do you want to make a real difference to the lives of residents in housing need? Sutton-In-Ashfield, Nottinghamshire
Recuriter: Ashfield District Council

Building Services Operative

Ashfield District Council
£25,584 - £27,269 per annum (pay award pending)
The Facilities team are looking to recruit an enthusiastic individual Sutton-In-Ashfield, Nottinghamshire
Recuriter: Ashfield District Council

Street Cleansing Technician (CDC)

City Of Doncaster Council
Grade 5, £24,397 per annum (pay award pending)
Do you enjoy working outside, as part of a team that make a direct difference to the communities of Doncaster? Doncaster, South Yorkshire
Recuriter: City Of Doncaster Council
Linkedin Banner