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Government emergency funding during the pandemic did not benefit staff in care homes.

According to Amy Horton lecturer at University College London and researcher for Financial Impacts of Covid on Care Homes, new research sheds light on how much extra money went into care homes during the pandemic, and how it was spent.


The government scrambled to pump money into the sector, but to a large extent, staff often kept services going at a cost to their own wellbeing. The research also reveals that workers fared differently in for-profit care companies compared with not-for-profit organisations. These insights hold important lessons for the future of care.


Spending on emergency funding


The research showed only a small proportion of the government’s emergency funding was spent directly supporting care staff. Care homes for older people in the UK received extra public support worth £2.1bn in the first year of the pandemic – about £5,900 for every individual care home place. Services needed support to help cover the huge costs of Covid-19. They received free PPE, money to cover sick pay for staff required to isolate, and subsidies for empty rooms as residents died and new admissions were suspended during outbreaks.


The government funded full sick pay for Covid across the UK and, for some of the care home workforce, “recognition payments” of a few hundred pounds. These were important but modest improvements. Yet in our survey of more than 600 staff, two-thirds said extra funding for their employer did not benefit them. Most reported working much harder without an increase in pay, and often doing unpaid overtime.


Care staff suffered personal financial problems


Disturbingly, more than 40% of staff in the survey reported that they had experienced personal financial problems linked to working in care during the pandemic. There was a range of reasons. Some had their hours cut if their home had fewer residents. When care staff caught Covid, employers didn’t always offer full sick pay, despite government support for the cost. They also lost earnings if they had to take time off to care for family members with the virus. In contrast, there was an unexpected jump in pay-outs to investors in the first year of the pandemic. Dividends from 122 care companies rose by 11%.


Business models of care homes


Even though the UK government has shown little interest in the business models of care homes, there is mounting evidence that ownership matters. Staff in for-profit care homes reported greater increases in their workload and working hours during the pandemic. They were less satisfied with their sick pay and the support available to them. These differences could be because some companies are paying out significant portions of their revenue to investors, landlords and creditors, rather than reinvesting in the service. And although there are many committed managers in private care homes, not-for-profits care homes were less likely to cut spending on staff during the pandemic. Amy Horton suggests they may be offering more secure contracts and pursuing different priorities.


Greater transparency of income distribution in private care homes


We need to see greater transparency on how companies split their income between staffing, facilities, rent, debt repayments and profit. Unlike not-for-profit care homes which have a duty to their residents and staff, private care homes also have a duty to their shareholders.


Companies that make profits from the operation of care homes should not expect to be bailed out by the public purse when things become difficult and should maintain reserves for such contingencies.


Summary


The research carried out by Amy Horton shows that during the pandemic only a small proportion of emergency government funding was spent directly supporting staff in care homes. Many staff kept services going at a cost to their own well-being.


Not surprisingly the research also revealed that workers fared differently in for-profit care companies compared with not-for-profit organisations. Staff working in private for-profit care homes reported greater increases in their workload during the pandemic, but two-thirds said extra funding for their employer did not benefit them. Even though dividends from care homes rose by 11%.


There is a case for greater transparency in care homes on how income is spent. Can we continue to have staff recruitment and retention issues that have been laid at the door of poor pay and conditions, when more realistic profit margins could go some way to solving the problem?


Albert Cook BA, MA & Fellow Charted Quality Institute

Managing Director

Bettal Quality Consultancy

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