Living Wage 'could harm home care sector'

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Living Wage 'could harm home care sector'
By Nick Triggle Health correspondent

The National Living Wage could result in a "catastrophic failure" in the home care market, the industry is warning.

About 500,000 vulnerable over-65s rely on the support, which includes help with washing and dressing.

But in a letter to the government, the UK Homecare Association said unless extra money was put into the sector, it would leave services "unviable".

The majority of care is bought by councils, but the group said they do not pay enough for care firms to cope.

Under plans announced in the Budget, workers aged over 25 in the UK will be paid a minimum of £7.20 an hour from April next year, rising to £9 by 2020.

The UKHCA believes the introduction of the National Living Wage will require councils to pay a minimum price of £16.70 an hour for services.

This is based on using the cost of paying the National Living Wage and then adding to that the costs of running the service, including travel costs for staff and pension contributions. Just under 50p has been set aside for profits.

But, according to research published by the UKHCA earlier this year, the current average is £13.66, which the organisation argues is not even enough for care providers to meet their current obligations in terms of the minimum wage.

http://www.bbc.co.uk/news/health-33678919

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