By Debbie le Quesne

Minimum wage: Where can this extra money be found?

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Last week saw the closure of a domiciliary care business in the Dudley borough with the predictable upset for clients using the service.

It’s horribly sad when this kind of thing happens. I feel for both the service users and the service providers.

I am not aware of the circumstances which prompted the demise, but I do know the borough’s social services valiantly swung into action to pick up the calls, something that I think we may well be seeing more when the latest minimum wage figure has to be paid out.

The Low Pay Commission has recommended a three per cent rise in the National Minimum Wage. For those who follow my blog, I posted my concerns on Friday when the BBC broke the news.

Since that heart-sinking moment I have been busy thinking through the implications of the increase, if accepted by Government – and I strongly suspect it will.

I believe the uplift, which will see the National Minimum Wage go from £6.31 to £6.50 per hour, will add further pressure to an already creaking care sector – and here’s why: According to my West Midlands Care Association calculations, for a small care company with two homes. the increased cost incurred would be £22,000. On average, that translates to £6 per week

per resident.

The implication to domiciliary providers will be similar as they have other staff overheads as well as front line personnel, so we are expecting an extra 40p per hour to be required here.

I read recently that In February, the BBC used the Freedom of Information Act to discover that only four out of 101 councils in England paid at or above the United Kingdom Homecare Association’s recommended minimum price to £15.74, a figure – far in excess of the figure offered by most local authorities.

The £6.50 figure is less than the £7 we expected, but for sure, the local authorities of the West Midlands cannot afford to foot this additional cost of care in the private sector, unless the Government steps in to release more social care budget.

Those aged 16-17 would see an increase of just under two per cent, to £3.79 an hour.

Like many of our members, I fear the consequences of legislation taking precedent over the sensible economics of business.

I truly believe that many of our members are at the end of smart thinking and that more economies will not be achievable. And I know for a fact that since the economic downturn the minimum wage has risen faster than other wages.

I can only urge, that when local authorities are assessing care packages for community or residential settings that they take into account of the full cost implication of this latest guidance on pay.

Yes, we would all wish to see the industry better reward its staff – frankly, they are worth a king’s ransom – and every one of our WMCA care providers would agree. But reality is sometimes a harsh master . . . and I’m left asking, where can this extra money be found?


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