Southern Cross Care Homes

Baroness Thornton Excerpts

Tuesday 12th July 2011 Lords Chamber

[Baroness Thornton]

My Lords, I thank the Minister for repeating the Statement. Although we had a discussion about Southern Cross two weeks ago, it is an ongoing sorry tale which seems to get worse by the day for the residents, their families and the staff of Southern Cross. I think the Minister will accept that Southern Cross’s announcement yesterday that the responsibility for managing the 752 homes will pass back to the 80 landlords who own them will almost certainly cause a vacuum that is bound to be the source of great uncertainty and anxiety among residents and their families.

I am reassured that the Government are very active on the matter, but there are questions that we need to have answered. Southern Cross is not being informative and there are things that we need to know about the situation. My questions concern what happens next and how the Government will manage this difficult situation. Can the Government publish a list of all 80 landlords? I have read in the media rumours that some landlords still have to be identified. Yesterday, it was further announced that control of 250 of the homes would be handed back to their landlords immediately. What does immediately mean? Does it mean tomorrow? What will happen? What is the process?

The House needs to know which homes those are and who is running them. Is a list available? It is certainly not available on the Southern Cross website. It is also likely that many of the landlords will have little or no experience of running care homes. For example, does the Minister have any information on the intentions of property-owning companies such as London & Regional, which owns 90 Southern Cross homes, or Prestbury, which owns 21? In the previous Statement in the House, the Minister assured the House, as he has again, that the Association of Directors of Adult Social Services is trying to support its members, who will have a key role in ensuring that the new operating companies are able to provide good quality care and that they know how to perform financial stress tests to ensure that their business models are sound. What support and assistance are the Government providing to ADASS?

I read from my press cuts that Downing Street has said that public money will be used to ensure that those in the homes can stay. Is that true and how would it be achieved? Would money be made available through local authorities? If the Government intend to provide additional resources, they will need to do so to hard-pressed local authorities if they are expected to help. What advice are the Government giving to local authorities if the property company or landlord for any of the home-owning companies is offshore?

I am reassured that new operators taking control of the homes will need to be registered with the Care Quality Commission and that plans are in place to ensure that that happens, but given the pressure on the CQC, I wonder how it will be able to achieve that within the timescales that we seem to be facing. Will the Government make more resources available to the CQC to deal with that worsening situation?

What can the Minister tell the House about the terms and conditions of the 44,000 employees of Southern Cross? Does the Minister know how many homes are likely to close? What is the timetable for such closures likely to be? What will happen to those residents? We know that, for the very old and very vulnerable, a move such as that can result in their death or hospitalisation. That is an extremely distressing matter.

Turning to the care home sector more generally, it would seem that although Southern Cross is definitely the most urgent, it is not alone in the sector in its struggles. The UK’s second largest care home provider, Four Seasons Healthcare, has amassed debts of £730 million that have to be repaid by September 2012. What will happen to the Lloyds properties, as this landlord is in administration? NHP, which owns 250 homes, is at a standstill with its bondholder. Indeed, my honourable friend John Speller MP, in his question in another place to the Secretary of State for Business, Innovation and Skills, pointed out that it is not just old people we are talking about here. For example, Craegmoor provides residential care services for adults with mental health problems or learning disabilities. It has 3,300 places, 174 care homes and a debt of £37.8 million. Care Principles provides similar services. It has 450 places in 17 care homes and secure hospitals; its debt is £45.77 million. Care UK runs care homes and services for the elderly. It has 3,100 places in 57 homes and a debt of £127 million.

Clearly these problems have to be addressed. I do not expect the Minister to answer questions about those homes. However, I am asking the Minister whether there is a plan and, if so, what is it? It seems to me that Southern Cross is actually the beginning of this process and solving its problems may not be sufficient.