Care home crisis ‘tightens its grip’ – report shows care home closures on the rise in England and Wales

The number of care home insolvencies in England and Wales increased by nearly a fifth in 2015 according to new research published.

As local authority spending cuts bite and the National Living Wage impacts on costs the pressure is mounting on care homes and the sector continues to struggle.

  • In 2015 total of 47 care homes became insolvent in England and Wales, up from 40 in the previous year and up from 35 in 2012-13, according to figures from accountancy firm Moore Stephens released today (April 25).
  • Further cuts in local authority spending, coupled with the introduction of the national living wage, will heap further pressure on the sector, said the report.

Mike Finch, of Moore Stephens, said homes are under growing strain and face a sharp increase in their wage bill.

The sector has complained it will struggle to fund the new National Living Wage of £7.20 an hour introduced this month.

Mr Finch said: “With funding from local authorities contributing a substantial amount to the revenue of care homes, there is understandable concern of the impact any further spending cuts would have on the sector.

Care home sector is at a 'tipping point' – Mario Kreft

CFW's chair, Mario Kreft (pictured below), said care homes in the poorest parts of Wales are particularly badly affected because many homes in these areas receive all their funding from local authorities, which have seen their own funding cut.

He said: "What the figures show is that actually we are passing the tipping point. There is almost nothing now that can be done to save some of these [homes] that I would consider, very valuable community assets.

“There are people I know with small rural care facilities, who basically are at 100% occupancy. They are always full with a waiting list.”

Read more on this story

Walesonline: Care home crisis tightens its grip as cuts bite and living wage adds to costs

Walesonline: Rhondda Care home to shut because it couldn't recruit 'suitably experienced nurses'

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