Baseline fees almost keep pace with inflation in 2013/14

The gap between the average uplift in care home fee rates for older people paid by UK local authorities for 2013/14 and care home cost inflation is narrowing, newly released research from Laing & Buisson has found. The news marks an end to a three-year period which saw baseline fee rates fall significantly in real terms each successive year from 2010/11. CCMn’s Annual Survey of UK Local Authority Baseline Fee Rates 2013/14 found councils giving an average uplift of 1.8%, very close to the 2% Laing & Buisson estimates is needed to keep pace with care home cost inflation. This is a marked difference from the chasm between an 1.6% uplift in 2012/13 against the 2.5% rise needed to keep margins neutral. The bridging of this gap is in part because providers have maintained tight discipline on pay rates, helped by price inflation generally subsidising for non-staff items. This year’s baseline fee results are relatively positive for the care home sector, but there will be no collective sigh of relief from care home providers, since none of the ground lost in the previous three years has yet been regained and there remains no sign of any inflation busting increases in the years to come, with councils’ budgets are expected to remain under severe pressure. Of the 133 councils providing figures for 2013/14, 62 councils gave below standstill’ uplifts, including 31 which froze fees (though none reduced them). Fifty-six gave fee revisions in the standstill’ band (2–2.9%) while just 15 increased baseline fees at a margin enhancing rate of 3% or above. The remaining 74 councils either had not yet set their baseline fee levels at the time or did not respond.

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