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Care homes fear mass closures as capacity falls

Patient - Britain's care home capacity has declined - SantanderCB

Britain's care home capacity has declined for the first time in a decade, intensifying fears of mass closures next year unless the government increases funding for the elderly in the Autumn Statement. Industry analysts LaingBuisson reported that over 1,500 beds were lost in the year to September, reducing the total to 451,400. Britain's care homes have been squeezed by a 6% real-terms reduction in council fee rates since 2011, at a time of rising rents and energy bills. Moreover, wage costs are about to rise sharply as the minimum wage is increased. However, Julian Evans, head of healthcare at Knight Frank, said the sector was likely to be attractive to private providers in the longer term. He explained: 'There are approximately 7,300 care homes that operate with less than 30 beds which have a very real chance of closing down in the near future, as they will be unviable. [This would] be devastating for owner operators but ironically good news for the major providers, who will benefit from an increase in occupancy due to the extra demand for beds. This will drive the further maturation of the sector towards corporate operators.'

 

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