Private care home residents pay nearly £10,000-a-year extra to subsidise council shortfalls

Private care home residents are paying nearly £10,000-a-year extra to subsidise local authority patients because councils can no longer afford their bills, MPs have found.

A report by the Communities and Local Government Committeediscovered that 96 per cent of people who paid for private care were unknowingly spending an average of 43% more than their state-funded neighbours for the same room and same level of attention.

Care home campaigners said it amounted to a ‘stealth tax’ on private residents. The average cost of a private care home in the UK is approximately £31,000 a year, but the report suggests that is should be closer to £22,000 if private residents did not have to pick up the council shortfall.

The CLG Committee said it was unacceptable that private individuals were picking up the bill for council deficits and called for an urgent review of social funding.

Clive Betts, Chair of the Communities and Local Government Committee, said: “It’s a very big difference in terms of what private individuals are paying.

“In many cases, councils will not be meeting the cost of their residents at all and constantly re-negotiating down how much they are willing to spend, so care providers have no choice but to find the money from their private residents.

“There is a clearly a crisis in social care, not just in funding but in provision. A long-term fix, working on a cross-party basis and involving the public and social care sector, is urgently necessary to meet the ever-increasing demographic pressures on the system.”

MPs found that several care providers including Kent Integrated Care Alliance and Brunelcare had been told by councils that their private rates “should be raised in order to subsidise the socially funded provision”.

Stephen Burke, director of the Good Care Guide and United for All Ages, said: “This is a stealth tax on people who fund their own care home places.

“The care system is so underfunded that some care homes can only make ends meet by cross-subsidizing state funded residents. We need a properly funded care system that is fairer, simpler and sustainable to meet the needs of our ageing population.”

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