An interesting development ?
Today's Guardian :
https://www.theguardian.com/society/201 ... ckbay-bill
Tory MPs demand bailout for care agencies in £400m backpay crisis.
Services hit by massive bill may face closure without state aid, say campaigners.
Our monies used to bail out " Charities " who broke the Employment laws ????
Senior Tory MPs have joined calls for a government bailout of social care providers, after warnings that some will go bust as a result of a crisis over a £400m bill for back pay. Former cabinet ministers are among those concerned about the government’s failure last week to guarantee financial aid to those affected. It comes at a time when the social care sector is already under extraordinary financial pressure.
The crisis arose after a court ruled that carers staying overnight, known as sleep-in shifts, were entitled to the minimum wage, rather than a flat-rate £30 which had been paid by care providers. Charities say they had been wrongly advised by government guidance. It means some face bills for back pay covering up to six years, with many saying they will simply fold without a bailout.
After months of delay, the government announced a scheme that would give providers 15 months to calculate the amount they think they owe their workers. However, it did not give any guarantees that state support would be available to help them pay it. The concession has been criticised as inadequate by councils and charities facing big bills, while Tory MPs are also concerned. Some are demanding urgent action in the chancellor’s budget later this month. Sarah Wollaston, chairwoman of the health select committee, said: “Unless there is government funding for the backpay bill, many providers will go to the wall, and there is also a huge issue here for those individuals who receive direct payments. I hope this will be addressed in the budget.”
Peter Aldous, Tory MP for Waveney, said ministers had “not addressed the problem” and called for financial help: “The government’s announcement just adds to the uncertainty overhanging the sector,” he said. “I’m minded that the government has said they wanted to work with the sector and providers to find a solution, and I do think they need to get back to that discussion. So far, we are not at that point. To be fair to this government, it is an issue that has landed on their watch so I have some sympathy. But the parties have to sit round the table, and there may need to be a financial package put down,” he added.
Kevin Hollinrake, Tory MP for Thirsk and Malton, said: “This needs resolving. Charities and other providers thought they were applying the rules correctly and now find they weren’t, so it is very unfortunate and puts them in a very difficult situation. This could cost the sector, to their reckoning, £400m, which would put some of them out of the work of providing care. It’s horrendous. We need a permanent solution.” Labour is also pushing the government to draw up a financial package to ensure that social care providers are not forced out of business.
Government officials say that ministers are still considering what action to take and whether financial aid should be made available. They said that EU state aid rules need to be investigated to determine whether any support, if deemed necessary, would be allowed.
Tim Cooper, co-chair of the LD Voices coalition of care providers, said no providers would “come out unscathed”.
“One charity supporting 85 people have calculated that if they have to fund the liability, that comes to £1.5m,” he said. “Their reserves total £1.4m, including properties and cash. Unless they get assistance, it is the end of the road. That is just one example of a number of charities in that position.This is not about employers trying to avoid paying staff. We are fully committed to paying staff, but it is difficult to do that when charities have not set money aside. We don’t know if we’re about to plunge over a precipice.”
Derek Lewis, chair of the charity Mencap, said: “The government has also kicked into the long grass the decision over whether or not it will give financial support for the sector. It is having immense consequences. At Royal Mencap, as one of the stronger organisations, we have had to put a stop on investment in new programmes, IT and employment. Staff are concerned. Some are sitting there in uncertainty. It is a massively destabilising situation to be in.”
A government spokesman said: “This scheme helps get workers the wages they are owed, while maintaining vital social care services for people in our communities. We have listened to the concerns of care providers and this scheme gives them clear time-scales and support to identify what they owe and need to pay their workers.”
Interesting ... one can see the reasons why ... Government would be faced with a financial crisis inside several supporting organisations.
At the same time , the supporting organisations stepped in to provide facilites no longer made available BUT ... without doing their homework first ... a theme all to offer seen in the social care sector.
No right answer beyond yet another crisis brought on by two factors ... lack of finance and stepping in blindly to fill the gap.
Seems to be that , in some sectors , it has not matter if one makes errors , someone else will bail you out ???
In the public interest ?
I will assume that no care providers caught up in all this are connected to certain mps ... ??????
Usual comments section buzzing ... just one to end ... for now :
It's clear that the model does not work, that it is open to abuse and lack of accountability, financially and operationally. The plethora of providers does not help, neither does the chronic underfunding and dwindling contract payments.
Rather than pay £400m to shore up a government created problem, I'd like to see a ring fenced social care system with clear budgets, managed by councils and run by non profits. Large care agencies owned by hedge funds have no place in delivering care to vulnerable people.
The government and councils need to get back to grant funding. Paying people the minimum wage to care for the elderly is offensive.