Southern Cross Healthcare

Emily Thornberry Excerpts

Thursday 16th June 2011 Commons Chamber

[Paul Burstow]

The right hon. Gentleman is absolutely right. The Government’s paramount interest—it is the interest that all of us in this House should have—is to ensure the welfare of residents. That has been the message that I, as a Minister, and officials have been giving, and will continue to give, to Southern Cross and to the landlords, and the CQC will have the responsibility of ensuring that that is carried out. It is absolutely clear that we all have to ensure that the restructuring succeeds, because that is in the best long-term interests of the residents.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

I thank the Minister for his statement, limited though it is. I congratulate my hon. Friend the Member for Blaenau Gwent (Nick Smith) on being granted this urgent question on an issue of great importance to Members of the House.

This is not the first time that Members have tried to bring the Minister with responsibility for care services before them to respond to their concerns. The lack of leadership and information from him during this period of uncertainty and anxiety for Southern Cross residents and their families, as well as its employees, has been notable. As a result of the agreement reached yesterday, we now appear to have a period of relative stability. However, great uncertainty remains for residents and employees at Southern Cross homes. We have heard that Southern Cross will now begin a period of restructuring, with reports of around 300 homes changing management, but contracts have been ripped up and it seems that 3,000 jobs are being lost. What assurances can the Minister give on security of employment for those working in Southern Cross?

On safety, last week we heard that Southern Cross is making 3,000 people redundant. We have also heard from the Care Quality Commission that Southern Cross has breached standards at 164 care homes—the equivalent of 28% of its English estate. Can the Minister guarantee the safety of and standard of care for residents, and how will he do this? Will the CQC carry out more frequent inspections?

There has been widespread condemnation of the business practices that led to Southern Cross’s financial problems. It is all very well for the Minister to point fingers at what might have happened many years ago, but this problem exists now, and the Minister is in government now. When people are treated as commodities with no thought to the consequences for them of this risky business model it is important that Government step up to the plate and do something about it. Southern Cross is not the only company in this industry to have financial difficulties. We have heard from the Business Secretary that the business model of Southern Cross and others in the residential care industry will be looked at by his Department. Will the Minister provide more details on the timing of this review and how Members will be told about its findings?

On cuts, the Minister says that there will be robust local arrangements, and I am sure that local authorities will step up to the plate if asked to do so. He must recognise, however, that local authorities are already under enormous strain as a result of the cuts imposed on them by his Government, including the cuts that they are already having to make to adult social care. How can they be expected to pick up the pieces of this national problem without assistance nationally from Government? In other words, are they to be given more resources to deal with the problem of Southern Cross if they are expected to be involved in plan B?

[Paul Burstow]

The hon. Lady is long on critique but very shallow when it comes to how she would approach this differently. Last week, I set out in a written ministerial statement the approach that the Government were taking. We also dealt with this extensively at last week’s Health questions.

The hon. Lady asked about the 3,000 job losses that are being proposed as part of redundancy measures by Southern Cross. Let us be clear: it has a statutory obligation to declare a ceiling for the number of job losses that may—I repeat, may—take place in the business. I have asked the CQC to undertake additional inspections to address concerns arising from the proposed job losses, and that has already been put in place.

The hon. Lady talks about cuts in social care spending but glosses over the fact that this Government, through the spending review, agreed to an unprecedented transfer of resources from the national health service to support social care, with £2 billion extra going into social care by 2014.

We might agree that we need to learn lessons from what is happening to Southern Cross, in respect of regulation and how we ensure a stable and successful social care sector for the future. That is why the Government are committed to an overhaul of social care and to bringing forward a White Paper to set out the plans in due course.