Home care business gives up yet another council contract over ‘unacceptable’ wages

A DOMICILIARY care provider has given notice on another of its contracts with Merseyside councils, once again citing unworkable pay rates.

Listed home care business Mears Group has served notice to Sefton Council for new pay rates that it says would lead to unworkable conditions for care workers.

The decision, for which there is a six month notice period, will affect between 170-200 service users and around 75 carers. Sefton Council told TheBusinessDesk that it will secure an alternative provider during this time.

In mid-July, Sefton Council agreed to pay an increased hourly rate of £13 for care in the home, an increase it said would cost the council an extra £945,000 a year.

Alan Long, Mears Group executive director, said: “We will of course support Sefton Council with any transition of services to new providers, but we remain concerned that any provider could provide a safe and lawful service at this rate.”

He added: “The proposed new rate does not allow us to meet our responsibilities to the National Living Wage and provide a good, safe service to the people of Sefton, so once again we have been left with no option but to withdraw from the contract.”

Earlier last month, and before Sefton’s decision on the £13 pay rate, Mears cancelled its contracts with both Liverpool City and Wirral councils, citing the same reasons. Long said that local authorities were effectively bullying providers into operating illegally.

A spokesperson for Sefton Council told TheBusinessDesk: “While we acknowledge that there must be a balance when commissioning domiciliary care, it is vital this is weighted in favour of quality rather than cost.

“Our fees are set based on an understanding of the market and feedback from consultation with stakeholders.

“The rate of £13 is a significant investment by Sefton Council and was increased from a proposed rate of £12.60 following the consultation period.  The rate takes into account a number of market changes and issues, including the impact of the National Living Wage on provider costs.

“We work closely and positively with all care providers to ensure that the needs of service users and employees are always met to the highest standard.

“Fees are set following open and inclusive consultation exercises with providers, during which providers are asked to submit their comments on proposals put forward.  These comments are then considered in changes or proposals.

“We will continue to consult with domiciliary care providers and other stakeholders to assess the cost of providing care and assist in ensuring there is a viable market.”

The council added that it has set up a Care Services (Domiciliary) Working Group, made up of commissioners, elected members and providers to monitor the sector.

Last month, local provider WarrenCare was also forced to prematurely terminate a three-year £1m contract with Wirral Council after six months of fee negotiations, again citing pay levels.

Industry body the United Kingdom Homecare Association (UKHCA) recommends a minimum rate of £16.70 – Sefton pays £13, while Wirral Council pays £12.92 and Liverpool City Council pays £13.10.

The UKHCA has called on councils to address properly the issue of underfunding.

Ahead of Sefton’s decision being confirmed UKHCA’s Angel told TheBusinessDesk: “Sefton and other councils need to consider what its price will cover, and what it does not.  It is highly likely that such a rate can only offer a workforce paid at bare National Minimum Wage (national living wage for workers over 24 years), and increases the risk of non-compliance with minimum wage regulations.

“Councils should expect providers to begin serving notice where they believe they cannot meet their legal responsibilities.”