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SECTOR PULSE CHECK: Care providers forced to take ‘drastic action’ to cope with cost pressures

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The learning disabilities sector is reaching a “crisis point”, a new report has warned, with a growing number of care providers being forced to reduce capacity to tackle persistent cost pressures.

The Sector Pulse Survey, commissioned by Hft, found that more than half (62%) of providers have had to close down some parts of their organisation or hand back marginal contracts since the start of the pandemic, up from 45% on last year.

The main cost pressure cited was rising wage bills (79%) followed by lack of fee income (63%).

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Around a third (29%) of providers have made redundancies, in keeping with the last two years, with one in ten saying they have had to offer care to fewer individuals.

This is a trend that looks set to continue, with over half (51%) stating they are more likely to close down some parts of their organisation or hand back marginal contracts and 47% likely to make staff redundancies in response to Covid-19 cost pressures.

Kirsty Matthews, Chief Executive for Hft, said: “While the Covid-19 pandemic has seen some additional funding enter the sector, it falls far short of solving an enduring and underlying financial challenge. The precarious financial situation is a culmination of years of financial pressures, which have forced providers to take drastic action in order to remain sustainable. It is vital that the government brings forward a long term funding solution for adult social care to safeguard the future of the sector.”

Josie Dent, managing economist at Cebr, which conducted the survey on 72 providers, said: “The finances of the social care sector continue to stand in a precarious position as costs rise, yet in spite of this, the research shows providers have increased their mental health support for staff over the past year.

“Furthermore, a lack of fee income, cited by over three in five organisations, means these increasing costs are difficult to fund. We are therefore seeing more and more providers close down some parts of their organisation or hand back marginal contracts and services to their local authority, with 62% taking this action in 2020.”

Commenting on the report, Dr Rhidian Hughes, chief executive of the Voluntary Organisations Disability Group, said: “This year’s Hft Sector Pulse Report highlights the extent to which the coronavirus pandemic has exacerbated the challenges already faced by an over-stretched and underfunded social care sector.

“High quality support services for disabled people can be transformative and this report, as we collectively look to recover from a truly challenging year, clearly exposes how the government and it agencies must do away with short-term fixes and instead invest in sustainable, long-term reform.”

Hft is now calling on the government to ensure the future financial sustainability of the social care sector by providing immediate funding to stabilise the system while working towards an equitable and sustainable funding solution in the longer term.

Tags : HftSector Pulse Check
Sarah Clarke

The author Sarah Clarke

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