The UK Care System is in severe crisis. Over 12 years of underfunding has led to a spiralling momentum towards this severe crisis ever since the Con-Dem government spending cuts to local government in 2010. With funding for local authorities having been cut by over half (55%) between 2010/11 and 2019/20 [1], it has created a ‘ticking time bomb’ in social care provision and staffing levels because of over a decade of wage restraint on wage-levels which were already pitifully low.

As things stand now at the start of 2023, the Care Quality Commission (CQC) report that there are now currently 168,000 vacancies in social care. [2]  The shortfall in capacity is the cause of the current hospital bed-blocking crisis, with an estimated 13,000 people currently taking up beds in hospitals waiting to be accommodated in care homes and the knock-on effect in A&E waiting times and ambulance wait-times (and even ambulance queues). The social care crisis has now become a national crisis affecting one and all.

From Austerity to Catastrophe – the government’s inability to read the road ahead

Any care worker in the last ten years could have told you the care system was in crisis. How this has come to have the serious knock-on effect it has now had was not inevitable nor predictable. The situation we find ourselves in now has been because of an unprecedented set of circumstances being similarly felt across the world – namely the impact of covid. However, we in the UK find ourselves in a deeper mess altogether, with the NHS now at breaking point, with strikes an inevitable course of action for a desperate workforce with no alternative way of getting their message heard. Unique UK circumstances amplified this crisis: it was as a result of structural deficiencies in the care sector “market” , that some care providers closed down due to loss of patients, and the impact of this merged with the double-whammy of labour market effects from Brexit and the sudden impact from the exodus of 50,000 care staff from the care-system after the temporary enforcement of vaccine-mandates on care-staff during the epicentre of the pandemic – all of which has led to the sudden contraction in the capacity of care provision we have now. It is the knock on effect from this that has escalated the crisis in the NHS this winter.

 The structural integrity and durability of the care system has undoubtedly been weakened over the past 13 years as a result of the cuts imposed in the austerity years and continued shortfalls of funding by the last two Tory governments since Theresa May declared “austerity was over” in 2018. 

Nevertheless, this structural deficiency of the care sector has not only been the result of long-term underfunding. A key facet of this structural deficiency has been a result of the fact that care providers maintain a system of considerable profit extraction, which has combined with severe cuts to affect this weakening in the structural integrity of the care system to make it so vulnerable to these recent dramatic impacts – resulting in the present disintegration of the care system and its capacity.

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 1 According to a damning study into the sector from the Resolution Foundation published on 27th January 2023, social-care pay is “unlawfully” low for many workers, with “the staffing crisis having a negative impact on workload and safety” Ref: https://morningstaronline.co.uk/article/b/social-care-pay-unlawfully-low-damning-study-finds?fbclid=IwAR1jzZF7lQDW94EEDEKAJMeKukmX6xrNSqjgwN31Ws9bCbHbq0pRx_C6Pqw         

2. More than one million people work in social care in the UK. However, England is projected to need close to 500,000 more care staff by the middle of the next decade. A £500m workforce fund created in October last year by the government has been dismissed as “a drop in the ocean”. [Ref: Robert Booth, The Guardian, 11^th October 2022: “England’s social care workforce shrinks for the first time in 10 years”].  The labour shortfall is partially relieved by new rules to include care assistants, care workers, carers, home care assistants, home carers and support workers (nursing home) on the ‘Shortage Occupation List’ for the Skilled Worker visa route which took effect from 15 February 2022. However, with the cost of visa applications and the cost of living, the low salaries for these professions has so far not led to any significant flow of migrants into care work.      

                                                                                                                        

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The shocking, degraded status of care workers

With the escalation of the cost-of-living crisis and the impact of the inflation spike on real wages over the last year coming on top of a 12-year fall in the real wages of all workers and a feeling of under-appreciation for all of our frontline public sector workers, particularly NHS staff and teachers, it must be emphasised that care workers are at the absolute bottom of the heap in terms of pay and working terms and conditions. It is quite simply a national disgrace that care workers in the (albeit for not much longer) 4th largest economy in the world are paid so miserly. That they are paid so poorly reflects how they are effectively valued by society, though anyone who works in or has first-hand engagement with the care system would tell you, it is an utterly erroneous appraisement of the complexity and wide skillset required in the job. They are largely the forgotten, unseen workforce in society in general, seemingly only getting wider recognition during the pandemic for obvious reasons (though the reality of their existence of being like ‘canon fodder’ was perhaps never more prescient than during the height of the pandemic in 2020). Virtually all are un-unionised because they are very much a highly fragmented workforce, with the vast majority of both home-visit care and residential care-home provision in England now provided by private companies. Some care workers are employed on zero-hour contracts, with contracts of employment with minimum wage levels. The average hourly pay of care workers, £9.50, is currently £1 less than novice healthcare assistants in the NHS receive (by comparison, starter jobs in Amazon Warehouse pay £11.45 per hour for a day shift, rising to £22.90 per hour overtime), with almost a quarter of care jobs being precarious zero-hours contracts compared with 3% in the wider population.  However, researchers from the University of Surrey found that the average salary of the top executives at some of the largest care home owners including Barchester, HC-One, Care UK, Avery Healthcare and Signature Senior Living, has disgracefully rocketed by more than 100% in five years! [3].

Hourly-rate pay is usually given to carers who do home visits, with time per service user limited because of travelling time between service users. However, there have been cases of carers being paid per visit and not getting paid travel time, such as the case in 2020 of ten home care workers awarded more than £100,000 in backdated earnings following an employment tribunal ruling after the tribunal ruled they had been illegally paid less than half the minimum wage (£4 an hour) in contracts with care service companies, Kaamil Education Limited, Diligent Care Services Limited and Premier Carewaiting Limited who inherited the contracts from the care provider, Sevacare. [4]   A significant number of care home providers are large chains with private equity parent companies hidden in complicated organisational structures. A report by Unison highlighted the growing role of private equity in the sector, finding that more than one in nine (12%) care beds in the UK were now in the hands of investment firms. [5]  Although local authority budgets have been drastically cut by the central government – forcing them to reduce the amount they pay to private providers – private providers can still achieve significant rates of return on their capital investment, with 12% normally expected. [6]  UK’s biggest care home chains saw their profit margins jump by 18% on average during the pandemic [7] The introduction in 2016 of a ‘national living wage’ for workers aged 25 and over of £7.20 an hour, rising to £9 an hour by 2020 had consequences for the trading margins of private care providers. Previous to 2016,  staffing costs were held down to support profit levels in the years of austerity following the global financial crisis with reduced funding of social care, across the care sector, wage levels were generally kept at or only barely above the very base-minimum-wage levels of £6.19 in Oct 2012 and £6.50 in Oct 2014.

When privatisation of care first started

The privatisation of adult social care began in the 1980s. The creation of ‘personal social services’ as a ‘fifth social service’, complementing the four established pillars of the post-war welfare state – social security, education, housing and health – was only accomplished by the Local Authority Social Services Act of 1970; barely two decades later these services became a prime field for the new neoliberal policy of outsourcing public services to the private sector. Following Sir Roy Griffiths’ 1988 report for Margaret Thatcher on the funding and organisation of community care, the 1990 National Health Service and Community Care Act re-cast local councils as ‘enabling authorities’ rather than providers of care services, such as care homes. Funding for this new role
was accompanied by a central government requirement that 85% of it should be spent on the ‘external’ purchase of care services from the private sector so that local authorities began to contract with private providers to provide care rather than deliver it themselves. [8]

...and what privatisation of care provision has done to our care-system

Fast forward to 2023 and the legacy of 12 years of cuts in funding, plus a staffing crisis and affordability crisis to accommodate projected minimum-wage increases, has become a recipe for deterioration in the capacity and quality of the care sector (such as the closure of daycare centres, deterioration of facilities, reduced staffing levels and cuts in additional ‘services’ for residents, such as outings and entertainment), as care providers negotiate a trade-off between service levels and maintaining an acceptable rate of return on their profit margins. Increasingly, with ever-tightening financial budgets, services have become increasingly exposed to chronic and deliberate understaffing of homes, rationing of medical supplies and food, and the falsifying of paperwork to cover up mismanagement. Even amongst care providers registered as charities, there remains a suspicion that despite being “not-for-profit” providers, where rates of return on capital investment are not a defined objective, the deterioration in the level of service is a result of masking of the same outflows or leeching of revenue via some kind of financial accounting trickery with parent companies possibly deriving revenue streams within complicated organisational structures. 

In the case of domiciliary care, there has been wholesale adoption of a flawed ‘task and time’ model, with units of as little as fifteen minutes of care per client imposed in order to reduce costs. [9] 

The 2016 report by the Centre for Research on Socio-Cultural Change (CRESC) argued that the financialised care home chains with their debt-based financing model are not suitable for this kind of low-risk, low-return activity, with cash extraction and debt-leveraged buyouts having created an unstable, fragile residential care sector. [10]

Outside of care homes and in the community, cuts in local authority care services have placed increasing pressure on unpaid carers, with 1.6 million people aged 65+ not receiving the care and support they need with essential living activities, with local variation in care provision leaving many older people without any support in poorer areas, especially in deprived areas of the country. [11]  The future remains bleak with chronic underfunding combined with severe staffing shortages, and with a growing elderly population (a projected 49% increase in those aged 65+ by 2040), it is increasingly leading to a situation wherein as things stand, many in the future will not get the care and support they need. Promises by successive governments to fix the system left hanging in the air for the last 2 decades, with calls for fundamental reform and a concerted plan seemingly continually pushed back because the scale of the challenge with an ageing population is so daunting, will inevitably cost billions of pounds, even with homeowners having to put charges against their property below set-limits (as opposed to the current situation of the entire value of their property). The national insurance rise put in place to underwrite a vague back-of-the-envelope non-plan by Boris Johnson’s government has since been reversed. However, recognition of the scale of the challenge is actually recognised in government, even if any move to tackle it keeps being put on hold.  The problem, apart from the competence of the government of course, is that the system of privatised provision we have in place is not fit for purpose – a system in which private providers gleefully rub their hands cashing in on the considerable property assets of the elderly and infirm and dementia inflicted.

The drastic collapse in the capacity of provision and the level of service as a result of a sudden loss of patients because of covid and loss of staff due to covid mandates has now come on top of all this.

What has happened to the care system is a warning to us all of the dangers of privatisation of the NHS.  It shines a disturbing light on what the future of a privatised NHS could look like.

Overhaul measures

Profiteering must be removed from social care. The profit motive is incompatible with the provision of quality, affordable care. It is also time the skills and experience of care staff were respected instead of them being underpaid and undervalued. UNISON is calling for reforms, including a move towards a non-profit care sector and a limit on the size of care home groups. [12].  

The starting point must be the immediate implementation of the following 6-point transitional plan:

1).  Full restoration of the social care budget component of the local government settlement from the Treasury to 2008/2009 levels

2).  A national wage for carers that has equivalence with care assistants in the NHS.

3). A tightening of standards in regard to regulation of care homes with regard to labour regulations and their terms and conditions, including restoration of the right to sick-pay

4).  As advocated in the CRESC Report, the immediate imposition of a 5% limit on the rate of return on annual profits accrued by care providers in the management of care homes

5). Government legislation sanctioning the immediate confiscation of property owned by care providers who are found to have failed care standards (CQC) or are in breach of labour standards. Compulsory purchase of property by care providers who fail to limit the rate of return on annual profits outlined in (4) above

6). The financing of state-owned not-for-profit regional care providers whose capital finance will be dictated by the shortfall in provision from an anticipated rationalisation of care provision in the short-to-medium term because of the inevitable departure from the care-provision sector of some of the profiteering companies purely motivated to make money in the sector, due to the aforementioned action points (1, 2, 3, & 4) above.

Following on from that, with the start of the aforementioned inevitable rationalisation in the sector mentioned above in point 6, this process will naturally be extended and there will be an inevitable steady flow of availability of the physical infrastructure of care provision for sale on the market. At this point, as well as existing providers still remaining in the care sector, the government could step in further to purchase some of this property. However, the government may proceed to make considered judgements with long-term considerations of planning, the scale of provision, structural integrity and integrity of building design and sustainability in making decisions on to what extent it would purchase existing property as compared to building its own bespoke care provision infrastructure. [A model blueprint for the kind of new care-provision development which may better serve people with complex conditions or needs (such as a combination of learning disabilities and another long-term condition such as a severe mental health issue) could be the village-design layout of the site of Chalfont Epilepsy Centre, for instance].  These considerations, requiring commitment from central government spending, are akin to many other demands on the public purse. However,  resources spent this way for future care provision (with the largest areas bound to be elderly care and dementia care) would be the most cost-effective, equitable and sustainable use of resources in the long run, as well as being a more achievable means of providing affordable, quality care.

References:

[1]. BMA media team, 8^th June 2022: “BMA warns of social care crisis as the current system is ‘deeply flawed’ and in need of ‘urgent reform’ ”

Ref: https://www.bma.org.uk/bma-media-centre/bma-warns-of-social-care-crisis-as-current-system-is-deeply-flawed-and-in-need-of-urgent-reform

[2].  Emma Baines , The Nursing Times, 21 October, 2022: “Workforce crisis responsible for ‘gridlocked’ health and social care system”

Ref: https://www.nursingtimes.net/news/workforce/workforce-crisis-responsible-for-gridlocked-health-and-social-care-system-21-10-2022/

[3].  “Care bosses taking home 13 times wages of workers, says UNISON report”, 15 June 2022

Ref: https://www.unison.org.uk/news/2022/06/care-bosses-taking-home-13-times-wages-of-workers-says-unison-report/

[4]. “Legal win for care workers not paid travel time sees them awarded £10,000 in back pay”, by Jill Rennie, Homecare – 15 Sep 2020

Ref: https://www.homecare.co.uk/news/article.cfm/id/1633293/legal-victory-win-for-care-workers-not-paid-travel-time-to-visit-vulnerable-in-their-homes

[5]. Ibid, UNISON, 15 June 2022

[6]. The Centre for Health & the Public Interest, Nov 2016: “The failure of privatised adult social care in England: what is to be done?”, by the Centre for Health & the Public Interest

Ref: https://chpi.org.uk/wp-content/uploads/2016/11/CHPI-SocialCare-Oct16-Proof01a.pdf

[7]. Shanti Das, The Guardian, Sun 24 Jul 2022: “Private UK care homes’ profit margins soared in pandemic, research finds”

Ref: https://www.theguardian.com/society/2022/jul/24/uk-private-care-providers-profit-rise-covid-report

[8]. Ibid,  The Centre for Health & the Public Interest, Nov 2016

[9].  Benbow, S (2008), “Failures in the system: our inability to learn from inquiries”, The Journal of Adult Protection, Vol. 10 Issue: 3, pp.5 – 13

[10]. Ibid,  UNISON, 15 June 2022

[11]. BMA media team, 8^th June 2022: “BMA warns of social care crisis as current system is ‘deeply flawed’ and in need of ‘urgent reform’ ”

Ref: https://www.bma.org.uk/bma-media-centre/bma-warns-of-social-care-crisis-as-current-system-is-deeply-flawed-and-in-need-of-urgent-reform

[12]. Ibid, UNISON, 15 June 2022