A higher minimum wage is a solution to the crisis in care, not its cause

Improving quality of care requires higher wages for workers and an end to the socially irresponsible practices of large care home chains, writes Andrew Dolan

April 6, 2016 · 4 min read

Often things are more complicated than we first thought and in ways we didn’t expect. This is certainly true of the current crisis in adult social care in the UK. Yet despite the complexity of its causes there are a number of themes that repeatedly take precedence—and column inches—over others, one of which is the potentially destructive impact on the care sector of last Friday’s increase in the minimum wage.

This line of argument is central to what the research organisation CRESC, in their innovative new report on adult social care, refer to as a trade narrative, told mainly by spokespeople for large care home chains and repeated uncritically by the press. It goes like this: adult social care is in crisis because public funding has been cut, and already-squeezed care homes cannot afford the higher staff costs that will accompany the rise in the minimum wage.

Whilst there is truth to it, there are many reasons to question what is an incomplete narrative that functions to obscure a much more complicated situation. Of course, public funding has been reduced substantially in recent years, with local care budgets having undergone a 30 per cent decrease since 2010. This is undoubtedly a key factor in degrading the state and sustainability of care in the UK, but it is not the only one.

As CRESC have shown, large care home chains have been transformed by their owners into complex financial instruments, the purpose of which appears to be tax avoidance and cash extraction, as well as meeting the sizable interest payments on the hundreds of millions of pounds of debt accumulated through multiple highly-leveraged buyouts.

Together these practices constitute a business model in which it is almost impossible to account for the vast amount of public money pumped into the system, and where wages and working conditions are squeezed as a means of meeting excessive financial obligations arising in part from socially irresponsible debt.


Thus, when it comes to adult social care, talk of detrimental wage increases must be considered in the context of the sector’s largest providers channeling millions of pounds towards meeting the cost of business decisions taken with a view to maximise short-term returns.

Along with a reduction in public funding, it is this arrangement that is pushing adult social care into crisis, placing downward pressure on care quality. Far from exacerbating this situation, better-paid staff is absolutely crucial to solving it. There is no escaping the link between the low pay and high staff turnover characteristic of the sector and the care quality failures with which it is also associated.

This is not to ignore the scale of the financial crisis in care or the existential difficulties faced by many of the smaller providers that make up the majority of the industry. Rather it is to reaffirm that the interests of care home residents are best served by a well-trained, well-paid and well-represented workforce. Any attempt to reform the care sector must start with this understanding; and prohibiting the dubious business practices of large care home chains could be the first step towards realising it.

Scaremongering on the possible effects of paying care workers a fraction more than they now receive only serves to reinforce a trade narrative deployed primarily in the service of large care home chain owners whose motives are often ill-suited to the social good. So too does it betray an acceptance of a status quo in which care of the elderly is achieved at the expense of the wellbeing of the sweated workers—mainly women, disproportionately migrants, and some of the lowest paid—on whose backs the sector turns.

For further information on the financial practices of large care home chains see this article by the author: ‘Britain’s care homes are being turned into complex financial instruments.’


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