Care home owner hits out over ‘unjust’ North-South funding gap

The owner of two care homes in Gwynedd has revealed they could be paid an extra £500,000 a year for the same service if they were located in parts of south Wales.

Ceri Roberts, a director of Cariad Care Homes, spoke out over the “ever-widening North-South divide” that she says is blighting the sector in Wales.

Her company looks after a total of 76 residents and employs 130 staff at the Bodawen care home in Porthmadog and Plas Gwyn in Cricieth, making them one of the biggest employers in the area.

Most of the social care in Wales is funded by the public purse via local councils or health authorities.

A table compiled by industry champions Care Forum Wales (CFW) showed that all six local authorities in North Wales are rock bottom when it comes to the residential care fees paid to independent providers.

At the same time, according to Ms Roberts, homes like hers are being hit by a double whammy of “irresponsibly low” fees and soaring costs which will inevitably lead to more care home closures across North Wales.

Care homes in the region are struggling with increases of up to 100 per cent for utilities and insurance, along with hikes of more than 20 per cent for things like food and incontinence products.

The fees providers receive in North Wales can be up to £10,000 a year less per person than those given to their counterparts in South Wales for providing exactly the same level of care.

In recent months it’s been revealed that four care homes in North Wales – Trewythen Hall in Gresford, Bay Court in Kinmel Bay, Gwastad Hall in Cefn y Bedd and Morfa Newydd in Greenfield – have already had to shut with the loss of more than 160 beds, piling even more pressure on the beleaguered social care system and the NHS.

Rising costs

“I’ve been managing care homes since 2005 and year on year, it gets tougher,” Ms Roberts said.

“Our food costs have gone up by 22 per cent in the last 12 months and there’s been a 21 per cent increase in the price of incontinence products. At the same time, utilities have gone up 100 per cent. Those three items are the bulk of our costs other than payroll.

“We have been paying our staff the Real Living Wage for almost two years and we did that voluntarily. We just felt that the work the staff do is exceptional. It’s a tough job. It’s physically and emotionally a very difficult job. We’re very grateful for the team that we have and they deserve to be rewarded for the work that they do.

“On top of that, we recently introduced a loyalty bonus so the staff, providing they work their contracted hours as per their contract, they can then get an additional hourly rate on top of their salary just to give them that little bit extra and over the year, which would give them £480 per annum, regardless of their position.

“So, it’s important that the fees we receive are a fair fee for the care that is provided. But they’re not.

“Year on year, it’s a battle. Every year, we receive a letter from both health board and the local authority saying ‘this is what we’re going to be paying you this year’.

“I don’t know of any other industry that would put up with that. I can’t go to Tesco and buy my weekly shop and then tell them how much I’m prepared to pay them for what I’ve bought. It’s crazy.

“All we’re asking for is a fair and reasonable fee for the service we provide, a fee the covers the actual cost of providing care to ensure the service is sustainable and will be there for future generations.

“Welsh Government have a document called Let’s Agree to Agree which says that commissioners need to consult with providers with regard to fees but there’s never any consultation.

“We are now in consultation with the local authority because we will not be viable with the fees they are willing to pay

“The Real Living Wage has gone up by just over 10 per cent and the increase from the local authority is only 3.5 per cent, so how do you make things balance?

“If my care homes were in parts of South Wales, I would be over £7,000 per local authority funded resident more per annum so that would that would potentially equate to around £500,000.

“The extra money would enable us to have additional staff and we could invest more money in the homes. It could be put to good use instead of the constant struggle to make ends meet.

“Clearly, vulnerable people in South Wales are valued more than people in Gwynedd. Food costs the same in South Wales as it does here. It’s very unjust.

“I would anticipate that more care homes will close if things don’t change. It’s inevitable.”

Grave concern

According to Care Forum Wales, the situation is one of grave concern, with many care homes teetering on the brink of financial ruin.

Chief Executive Mary Wimbury said she expected the situation to get worse before it gets better.

She says local authority fees do not cover basic requirements or come close to meeting the actual costs of providing care.

There was also a widening North-South divide with the six North Wales authorities at the bottom of the fees table.

Ms Wimbury said: “People are struggling, they’ve been through a really difficult few years because of the pandemic and now on top of that, high inflation, staff wages increasing, cost of food, heating, insurance.”

Helena Herklots, the Older Person’s Commissioner for Wales, is among those worried about the deepening crisis in the social care sector.

Speaking to the BBC, she said: “We are hearing about closures of care homes but also concerns about whether the care home their loved ones are in was going to close in the future.

“It’s creating uncertainty and anxiety among older people, family and their friends and they’re also dealing with the cost of living crisis.”