Exclusive:‘Tsunami' of care home closures to come after Scottish Budget 'whammy'

Robert Kilgour claimed the sectors concerns had been ignored

There will be a “tsunami” of care home closures after the “double whammy” of the UK and Scottish budgets, a leading entrepreneur in the sector has warned.

Robert Kilgour, the chairman of Renaissance Care, claimed Shona Robison’s Budget statement on Wednesday had offered little clarity and left care home providers facing an anxious wait over their future.

Hide Ad
Hide Ad
PA MediaPA Media
PA Media

Speaking exclusively to The Scotsman, Dr Kilgour also accused the Scottish Government of failing to listen and of instead just using the Budget to play politics.

His warning comes after research published by Public Health Scotland last year showed one in five care homes have closed over the past decade north of the Border, with the Covid pandemic exacerbating the situation.

Dr Kilgour said contract discussions over care home funding would be expected to drag on until as late as June next year in the wake of the Budget.

“We are as clueless now as we were before the Budget, because the Scottish Government gives money to Scottish local authorities ... we have to take a gamble and a guess.

Hide Ad
Hide Ad
John Swinney and Finance Secretary Shona Robison need to list to genuine experts on how to tackle poverty (Picture: Jeff J Mitchell)John Swinney and Finance Secretary Shona Robison need to list to genuine experts on how to tackle poverty (Picture: Jeff J Mitchell)
John Swinney and Finance Secretary Shona Robison need to list to genuine experts on how to tackle poverty (Picture: Jeff J Mitchell) | Getty Images

“Our staff can’t wait until the end of June. We increase our staff pay in April, based on guesswork of what we might get from the fee increase.

“What do we do if we get a national living wage covered and a little bit for cost of living, but we have to cover 100 per cent of this employer's National Insurance double whammy?

“We have to prepare for what we are being told. I am also working with lawyers on whether there is a legal challenge possible on refunding local authority homes, but not us.

“I am also working on backchannels I have down to [UK Health Secretary] Wes Streeting, asking ‘are you aware of the damage to the NHS that is going to result from your actions?’

Hide Ad
Hide Ad

“Until both governments accept they need to pay closer to the true cost of care, then more care homes are going to close. Then the problem and the cost just goes through the roof.”

The chairman of Renaissance Care, which operates 18 care homes across Scotland and employs almost 1,400 people, warned both administrations had failed to recognise the issue facing social care. It follows the threshold at which employers must pay National Insurance on each employee's salary being reduced from £9,100 per year to £5,000 a year.

His warning comes despite the Scottish Government announcing a £2 billion overall increase in frontline NHS spending in Wednesday’s Budget, taking overall health and social care investment to £21bn.

Dr Kilgour said: “A lot of what she [Ms Robison] was saying in the Scottish Budget was blatant electioneering with May 2026 in mind. The problem is, we are not going to properly know until June, and so I worry that there is a trickle of care homes closing, and I think that will, in the middle of next year, and certainly after the settlement is final ... then I see a flood of care home closures becoming a tsunami in the second half of next year. Once a care home closes, that’s it.

Hide Ad
Hide Ad

“I feel that both the Scottish and UK governments are sleepwalking over a cliff-edge, and they do seem both blind and dumb the cries of the elderly, and our amazing staff.”

Dr Kilgour claimed care homes funded by councils were getting much more support than independent and third-sector providers, leaving them unsure of their future. It comes in a week where Scottish Care claimed the Budget failed to address the "urgent sustainability challenges facing the social care sector".

Dr Donald Macaskill, chief executive of Scottish Care, a representative body for independent sector social care services in Scotland, claimed the Scottish Budget would “kill people”.

He said: “This is a Budget that kills. It will kill any reassurance that the Scottish Government truly values social care, it will kill essential community services which are forced to close and leave workers without employment. And ultimately, it will kill people. People are dying because they can’t get the social care they need.

Hide Ad
Hide Ad

“I hear of services that will need to close and make staff redundant by next week. This is not good enough.”

Robert Kilgour warned care homes would close after the two budgets.Robert Kilgour warned care homes would close after the two budgets.
Robert Kilgour warned care homes would close after the two budgets.

Age Scotland has also voiced concerns, suggesting the funding announced by the Scottish Government is not enough.

Age Scotland’s policy director Adam Stachura said: “Delivering good quality social care cannot be done without sustainable and substantial investment. The Scottish Government’s pledge of £21bn for health and social is welcome in principle, but it’s hard to tell how much of this is dedicated to social care and if it is anywhere near enough. It doesn’t seem to be.

“The crisis within the social care sector suggests that a far greater investment and urgency is needed from the Government to ensure the availability of services to meet demand now and that they can scale up for the future.

Hide Ad
Hide Ad

“In many areas, the choice of care homes is extremely limited, meaning that many people may have to move considerable distances from their community and social networks to find a suitable place.

“If current trends continue and care homes are forced to close due to unmanageable costs and more older people end up in hospital as a result, the impact on people’s lives, wellbeing and pressure on the NHS is going to get considerably worse.

“The cost of self-funded care home places has also risen astronomically. This may well rise further as care homes struggle to manage overheads and are at risk of stretching beyond the means many residents can afford.

“Without urgent support, an increasing number of care homes may find it extremely challenging to keep their doors open.”

Hide Ad
Hide Ad

Scottish Labour social care spokesperson Jackie Baillie said: “The SNP must heed these stark warnings and ensure this Budget delivers for social care.

“Care homes are closing, thousands of Scots are waiting for care packages and delayed discharge is at a record high. The UK Labour government has delivered record levels of funding for Scotland, giving the SNP an extra £5.2bn to spend.

“We cannot fix the crisis in our NHS without properly supporting social care, and it is sheer incompetence for the SNP to ignore this fact.”

A Scottish Government spokesperson said: “The UK government must remove the financial uncertainty for social care providers, including care homes, by confirming it will fully fund any increases to employers’ National Insurance contributions in this area.

Hide Ad
Hide Ad

“The National Care Home Contract is negotiated annually between the Convention of Scottish Local Authorities [Cosla] and care providers, and we encourage all parties to work constructively to reach an agreement that continues to support high-quality care across Scotland.”

Chancellor Rachel Reeves has argued the hike in National Insurance for employers was "difficult", but necessary to fund public services.

Comments

 0 comments

Want to join the conversation? Please or to comment on this article.

Dare to be Honest
Follow us
©National World Publishing Ltd. All rights reserved.Cookie SettingsTerms and ConditionsPrivacy notice