Southern Cross Healthcare

Paul Burstow Excerpts

Tuesday 6th September 2011 Written Statements

[The Minister of State, Department of Health (Paul Burstow)]

I wish to update the House further on the situation regarding Southern Cross Healthcare.

Throughout, the Government’s overriding concern have been for the welfare and safety of the 31,000 residents in Southern Cross’s care. We are clear that this must be the paramount concern for all parties involved in the discussions about the future of the company.

Over the summer, officials have kept in close contact with Southern Cross’s senior management, landlords and lenders as the negotiations to achieve a consensual and solvent restructuring of the business have developed.

I have previously told the House that the intention is that the company will be wound up and its business transferred to other care operators. This will be done in such a way as to have minimal impact on the residents and staff of those homes. Until a new operator is registered and takes over the services in any care home. Southern Cross will continue with full responsibility for continuity of care.

In the last month, each of Southern Cross’s landlords has been considering which new care operator it will work with. Those discussions have progressed well and now all bar a handful of landlords are coming to the end of finalising the commercial arrangements that will apply in future. Within the next few weeks, we expect agreements to be signed that will effect the transfer of the business and assets of each home operated by Southern Cross to the new operators. The expectation is that formal transfer of care homes will be achieved in two waves, with around 330 homes transferred at the end of September and the remaining 400 homes transferred at the end of October. At that point Southern Cross will no longer be responsible for providing care anywhere in the country and the company will be wound up. Throughout, the Government have strongly urged all parties to agree their plans as swiftly as possible so as to offer reassurance to residents, staff and families. The company has informed all Southern Cross staff, together with residents and their families, of these plans in order to provide reassurance.

Last week, the Association of Directors of Adult Social Services published information for each of Southern Cross’s homes about the position it has reached in its transition to a new care operator. The information also included details of any inquiry or helplines set up locally or regionally by the company and by local authorities which can be accessed if further information is needed. As the new care operators are settled, their names will be added to the information. Within the next few weeks we expect the complete picture to emerge for each care home, and it will be clear who is the landlord and who is the new operator. Members may wish to draw this information to the attention of any constituents that are concerned or have relatives in Southern Cross’s homes. A link can be found at:

www.dh.gov.uk/health/2011/09/transfer-of-southern-cross-healthcare-to-new-operators/

The process to register the new care operators with the sector’s regulators in each part of the United Kingdom and to cancel Southern Cross’s registration has begun. No transfer of homes will take place without new operators having been approved and registered. Alternative operators will need to demonstrate to the regulator that they are capable of delivering high-quality care and of meeting all regulatory standards in the homes they take over. It is important that this process moves quickly and smoothly and, in respect of operators in England, the Care Quality Commission have assured us that they have the resources to complete the necessary regulatory work in time. However, regulators will not lower the regulatory threshold or reduce the rigour of the registration process to achieve that. Standards will not be compromised.

I understand that staff consultation under the TUPE regulations has also commenced and that the staffs elected representatives and the incoming operators are to be invited to attend a series of meetings to discuss these arrangements.

Notwithstanding the good progress that has been made, it is important that I restate the Government’s commitment that whatever the outcome, no one—state-supported or self-funded—will find themselves homeless or without care. We remain in close touch with the Association of Directors of Adult Social Services to ensure that in all parts of the country they are ready to respond to any potential disruption to the continuity of care and to ensure that all residents are protected.

I have previously told the House that the Government will be considering what measures may need to be put in place to prevent similar situations from arising again. Options for financial regulation or other measures will be considered as part of the development of the forthcoming White Paper on social care. To that end, we will shortly publish a policy paper setting out an analysis of the possible options and seeking views.

I will update the House as the situation develops.