Council approved 'unlawful' care home payment freeze by mistake

A council has had to halt the roll-out of revised payments to care providers - after mistakenly approving an 'unlawful' freeze of residential home fees. Stoke-on-Trent City Council agreed a fee uplift strategy for adult social care providers in March, which included keeping the amount it pays for residential care at the same level in 2024/25.

But last month Staffordshire Care Association, which represents local care providers, told the council that the fee strategy was unlawful as the freeze was in breach of an existing agreement with care homes. The 2021 care home agreement states that annual increases should be no less than 1.4 per cent.

Within two days the council had accepted its mistake and agreed to the 1.4 per cent uplift, which it says it should be able to 'absorb'. But Staffordshire Care Association called for the fee uplift strategy to be paused so further engagement with the care market can take place.

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Cabinet members are now set to agree to the requested pause so a six-week consultation with care providers can be carried out - with the aim of staving off a potential legal challenge over the breach. But the report to today's cabinet meeting states that there is no funding available for a fee uplift above 1.4 per cent.

The report states: "To continue with the fee strategy included in the cabinet report of 26 March in relation to residential placements is now considered potentially to be an inadvertent breach of the terms of the agreement in respect of the provision of care in care homes for older people and younger adults and could result in a legal challenge from care providers in respect of both breach of contract and judicial review proceedings. Pausing the current approach and entering into a period of consultation will mitigate the risk of legal action.

"While the service is confident that it can absorb a 1.4 per cent increase, any fee increase agreed over and above that amount will cause a resulting pressure will need to be reported in the current financial position, as no further funding is available."

The council originally proposed freezing residential care fees as there is currently 'no issue' with sourcing places in homes due to an 'oversupply' of provision in the city. But the council did agree a 4.48 per cent increase for home care, and a 5.47 uplift for nursing care.

A council spokesperson said: “We are addressing this issue with openness and transparency which is why it is going into the public forum through cabinet. What’s important is that any issues are quickly resolved so that we can continue to take good care of our residents who are at the heart of this.”

A spokesperson for Staffordshire Care Association said: "In representing its members, Stafford Care Association identified a number of factors which needed further consideration by the council, we are pleased to acknowledge their proposed next steps."