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NEWS RELEASE FROM THE Issued 17th March 2004 NURSING HOMES’ PLEA TO GOVERNMENT TO COVER COST OF Employers in the independent care sector are today urging the Government to make extra resources available to cover the cost of the next significant increase in the national minimum wage. This follows its announcement of a rise in the rate from £4.50 to £4.85 an hour with effect from October 2004. The Registered Nursing Home Association (RNHA), which represents around 1,200 nursing homes across the UK, says the 8 per cent rise in staffing costs which they are facing in the autumn must be met by proportionately higher fees paid for publicly funded patients. Nursing homes are already struggling to balance their books, the RNHA says. Many of them will be unable to absorb wage increases well above the rate of inflation. More closures are therefore inevitable. According to the RNHA, most of the local authorities which have so far decided on the fees they will pay for nursing home care from April 2004 are offering increases of between 3% and 5%, although some settlements have been as low as 1.5%. These figures, claims the association, will be inadequate to cover the 8% rise in the national minimum wage, as staffing costs represent the biggest single slice out of nursing homes’ budgets. The RNHA’s chief executive officer, Frank Ursell, commented: “The Government cannot push wage costs up to this extent without considering the consequences for employers. Nursing homes rely heavily on local councils for their income, as a majority of our patients have their costs met by social services.” He added: “The extra that we will have to pay out in wages later this year must be covered in full by councils. I hope the Government has done its sums right for once and that the money will be forthcoming. If it isn’t, we can expect another financial crisis in the care sector next winter, with many nursing home beds lost and further pressures piling up on over-stretched hospitals.” At this stage, the RNHA remains sceptical about the Government’s intentions. Its past record, claims the association, suggests a desire to get elderly care provided on the cheap and to bury its head in the sand when it comes to making the link between wage increases for staff and employers’ rising costs. “We certainly support the principle that everyone should earn a decent wage,” said Mr Ursell. “But staffing costs have to be paid for, and if your principal paymasters are local authorities and the Government, it is not unreasonable to look to them to find the necessary resources.” END For further information please contact: Frank Ursell, Chief Executive Officer, RNHA |
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