Care Home Time Bomb!

The title of this blog is taken from the front page headlines of the Daily Express on Tuesday 5th June 2018.   It’s a report from an investigation carried out by the GMB Union which investigated the level of arrears of older people living in residential care.   The figures are quite startling:-

  • 160,000 pensioners and disabled people are in debt as they cannot afford to pay residential care bills;
  • Nearly 1200 people have been taken to court by Social Services because of social care debts;
  • 78,000 have debt management procedures started against them for non-payment of charges.

If this is the situation, and it may be understated because not all Local Authorities responded to requests for information, it is certainly very concerning.

But I am puzzled ????????

If people have no assets, I thought the Local Authority was required to pick up the bill.  Alternatively if they owned a house, the Local Authority should pay the bill and take out a charge on the property which would be redeemed when the house was sold.   So why would Local Authorities be taking people to court for non-payment of fees ?

I must be missing something ????????

Successive Governments have confused the picture by continually reassuring older people and their families that they do not have to sell their house if they move into residential care.   Of course that’s understandable if there’s a spouse continuing to live in the house, but otherwise, what reason is there for not selling your house if you move into residential care?

Another explanation  for being in arrears is that many residential care homes now charge higher rates to individuals than the fees they agree with Social Services.   At one time, top up fees were not allowed but now it seems they are an everyday occurrence.   Therefore it’s quite possible that arrears might accrue from higher charges than Social Services deem eligible.   But in this case, I would assume the home owners would be the people taking court action.

The article does not delve into the issue more deeply to examine exactly why the debts arise.   But, with care home fees being as high as a £1000 a week and 160,000 people being in arrears and generally court action not taken for some time after people have gone into arrears, you could imagine that the overall debt must be COLOSSAL.

If each person was just £1,000 in arrears, that suggests there could be as much as £160 million owed by residents.  That can’t be right ????


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1 Response to Care Home Time Bomb!

  1. davidfreeman says:

    initially this is very disturbing! I just wonder if this is a case of an accountants game to rob peter to pay paul?
    An example/experience in my earlier life of accounting which I did not understand fully.
    A ship would be drydocked on a budget of costs. A past event would allegedly cause a repair to be carried out which was unforeseen [cost wise]- the staff [management company] would create an insurance claim, less deductables for the cost of the itemised repair. The holding management company responsible for the monies would now create a new account, against the alleged insurance company in detail- the cost of the insured damage would be presented to the ownwers of the ship as a cost incurred=but with a note of alleged recompense from the alleged insurance company.
    The management company on behalf of the owner pay the total costs for the completed drydock bill, excluding the alleged insurance claim cost- This would be an itemised accounts bill for settlement later when the alleged insurance company settled the claimed. Now we come to the crux of the insured alleged claim made, the management and owners were able to delay and pay the alleged insurance at a much later date when the accountants had settled the accounts for that particular ship/owner, and so it was that an ”alleged insurance claim whether legitimate or not,[due to lack of business acumen- but not integrity??]” was a vehicle for the accountants to delay payments, between all business agreements/partners? Being cynical the insurance company receiving a non bonifiedy claim may the next year increase the premium payment due to it, so everyone was a kind of ”winner”’? Its an accountants world, and I just wonder if the blog by John is questioning the recorded assets against the incurred expenditure by the local government and social services. The poor house owner tenant is being, maybe fleece though interest charges for cots incurred.
    But this is a cynical viewpoint? and an alleged practice by those in charge. Note maybe the council does not lose???

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