A major financial crisis at one of the UK’s biggest care home providers should act as a “stark warning” to Fife Council over its plans to privatise provision, it has been claimed.
Labour MSP Claire Baker spoke out after Southern Cross, which operates seven care homes in Fife and 11 in Tayside, announced it will underpay its rent in an attempt to get a “critical financial condition” under control.
The firm, which owns 750 care homes and is responsible for looking after 31,000 elderly residents, made a £311 million loss in the six months to March 31.
On Wednesday there were calls for government intervention to end the “uncertainty” over the future care of the homes’ residents.
Ms Baker, a list MSP for Mid Scotland and Fife, said the situation had significant implications for plans to close council-run care homes in Fife.
Members of the SNP/Lib Dem-run council voted in February to close all 10 of its homes and replace them with purpose-built accommodation run by the private or voluntary sector.
They said the existing homes were not “fit for purpose,” and that it was not financially feasible to keep them open although a consultation revealed the majority of residents and their families wanted them retained.
“The financial uncertainty surrounding Southern Cross should serve as a stark warning to Fife Council in its push to allow private companies to take over care in Fife,” said Ms Baker.
“The SNP-led council’s decision isn’t just cold-hearted, but presents real risks to the quality and reliability of care in the kingdom.”Council’s ‘responsibility’She added, “Axing future funding for all of Fife’s council-run care homes will leave more and more residents open to the type of situation residents at Southern Cross homes are experiencing.
“The SNP/Lib Dem council decision makes it clear that they want no council-run care homes in the future and to allow private providers to take over.
“But what happens if these private providers go to the wall? The council has a responsibility to improve care in Fife, not wash its hands of it.”
Councillor Tim Brett, chairman of Fife Council’s social work and health committee, said Fife Council was closely monitoring the Southern Cross situation and had “contingency plans” in place.
He insisted the developments did not have any impact on the local authority’s plans for the care homes and said no homes will close until alternative provision is available.
“I admire Claire Baker for trying to link this to what is happening in Fife, but the simple truth is the reasons for the council decision not to go forward in replacing our own homes remain absolutely the same,” he said.’Simply not good enough’He added that the quality of care in Fife across public and private providers was among the best in Scotland
Meanwhile, Southern Cross said it was confident a “critical mass” of landlords will support restructuring plans that will be drawn up over the summer.
Chairman Christopher Fisher said, “Our primary concern is the continuity of care to all our 31,000 residents.”
The group said it expects to make a further statement about its restructuring proposals in July.
On Wednesday Scottish Labour health spokeswoman Jackie Baillie called on the Scottish Government to hold emergency talks on the Southern Cross situation.
“It is simply not good enough for the Scottish Government to pass the buck to 32 separate local authorities and expect them to pick up the pieces,” she said.
Tory health spokesman Murdo Fraser added, “Our number one concern must be establishing a secure future for the many vulnerable older people affected.”
Southern Cross homes in Fife:
l Adam House, High Street, Dysart, Kirkcaldy.
l Balfarg, Kilmichael Road, Balfarg, Glenrothes.
l The Beeches, Ladysmill Court, Dunfermline.
l Chapel Level, Broom Gardens, Kirkcaldy.
l Forth View Care Centre, Sea Road, Methil, Leven.
l Lomond Court, Woodside Way, Glenrothes.
l Woodside Court, Woodside Way, Glenrothes.
Southern Cross homes in Tayside:
l Ballumbie Court Nursing Home, Ballumbie Road, Dundee.
l The Birches, Comrie Road, Crieff.
l Cairnie Lodge Nursing Home, Forfar Road, Arbroath.
l Catmoor House, Birch Crescent, Scone, Perth.
l Finavon Court, Carseburn Road, Forfar.
l Lunan Court, Albert Street, Arbroath.
l Muirton House Nursing Home, Essendy Road, Blairgowrie.
l Pitkerro Care Centre, Pitkerro Road, Dundee.
l Riverside View, Clovis Duveau Drive, Dundee.
l St Columba’s, Logie Street, Dundee.
l Strathtay House, Harley Place, Perth.