[New] Penarth

The residential care sector is vital to looking after the most vulnerable people in our society It s deeply concerning to see care homes closing their doors in a sector which already has a massive shortage of provision and which has seen occupancy levels return post pandemic

More insolvencies in this sector are said to be leading to additional stress on the National Health Service as patients who could otherwise be discharged to care homes remain in hospital beds

Care businesses are expected to be hit hard by rising energy costs Soaring energy prices are predicted to cost the care sector an additional £2bn per year which will place more care homes into financial jeopardy

Many care businesses also have large mortgages on their properties The recent interest rate rises will be creating further costs on any floating rate debts they have secured against their properties It will also prove increasingly difficult for care homes to be able to refinance their debt at an affordable rate

Residential care businesses are also struggling with a worsening labour shortage, exacerbated by Brexit reducing the supply of care workers Vacancies in the care sector have surged 52% in the past year * with care businesses struggling to hire and retain staff This is pushing care homes to hire healthcare professionals from more expensive agencies

Research by Knight Frank shows care homes with lower care ratings are less profitable than highly-rated ones One major reason for this is that care homes rated as inadequate are not permitted to take on any new local authority-funded residents, leading to lower occupancy levels