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Welfare Reform on the Web (August 2011): Care of the elderly - UK

The 2bn question: will Osborne agree to fund reform of elderly care?

N. Morris

The Independent, July 4th 2011, p. 1

The article reports that health chiefs have voiced concerns that the Chancellor, George Osborne, could veto proposals to reform long-term care for the elderly because they would cost 2bn-plus to the public purse. They also warned that hospitals could face a crisis because of the pressures of caring for the elderly and that this might result in even more stories of abuse of vulnerable pensioners. Andrew Dilnot proposed a cap of between 35,000 and 50,000 on the amount people would have to pay towards their care in their later years; the remaining amount would be paid out of the public purse. The bill for the Treasury is estimated to reach 2bn and it would have to be paid out of cuts other expenditure, and tax rises. In view of the other austerity measures already being implemented, the Government would be unlikely to welcome either solution. A Liberal Democrat source is quoted as saying that Mr Osborne is likely to kill the proposal 'at birth', although Treasury sources have said they would not kick the Dilnot plans into long grass and that they were keen to go ahead with the reforms. However, they have also said they would only act on the basis of consensus with the other parties and with groups representing the elderly.

Collapse of Southern Cross costs public purse 25m

H. Power and J. Sherman

The Times, July 13th 2011, p. 5

Southern Cross has announced that it is breaking itself up and returning its homes to its landlords. However it owes money in unpaid tax, national insurance and VAT after suspending payments to Revenue and Customs last month. At this point it will leave the taxman more than 25 million out of pocket. The bill is increasing as it continues to pay staff at its head office and in 502 of its care homes. It also owes about 45 million to Barclays and Lloyds Banks. Major shareholders are considering bailing out the business. Paul Burstow, the care services minister, has promised that the government would not stand by and let anyone find themselves homeless and no transfer of care would take place without the new operator being approved and registered by the Care Quality Commission.

'Fatal consequences' for elderly as Britain's biggest care home chain shuts down

M. Beckford

Daily Telegraph, July 12th 2011, p. 2

Southern Cross, Britain's biggest care home operator, has ceased trading after months of uncertainty. Southern Cross ran 752 care homes with places for 31,000 people. It has been agreed that 250 leased homes will be returned to landlords, many of whom already run residential care homes, but landlords responsible for the remaining 500 were said to be finalising their plans. This means that any judged financially unviable could be closed down, forcing elderly residents to move. The government has only guaranteed that no-one will be rendered homeless as a result of the closures.

(See also The Independent, July 13th 2011, p. 8); Guardian, July 12th 2011, p.13, 24 + 28; Times July 12th 2011, p. 10)

More elderly care homes set to close after spending freeze

J. Laurance

The Independent, July 14th 2011, p. 2

The health and social care consultancy Laing and Buisson has warned that more care homes for the elderly could go bust as a result of councils freezing the fees they pay for residents at a time when costs are rising. The widening gap between the money spent by councils and the increasing costs faced by providers could lead to staff reductions, and a decrease in quality and type of services provided.

Spending cuts cast shadow of doubt over 1.7bn cost of reforming care for the elderly

C. Smyth and R. Watson

The Times, July 5th 2011, p. 13 Hints that long-awaited plans to reform care for the elderly may be watered down are revealed in the cautious government response by the health secretary that 'In the current public spending environment, we have to consider carefully the additional cost to the taxpayer of the commission's proposals against other funding priorities.' Under the Dilnot proposals no one will have to contribute more than 35,000 of their own resources towards the cost of care. A cap has also been suggested on the costs of food and accommodation.

(See also The Guardian, July 5th 2011, p. 10)

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