Poverty pay: two sides to every story

11 Sep 13

Councils have been criticised for ‘turning a blind eye’ when home care providers pay their staff below the minimum wage. But commissioners should and do assume that bids include wage costs at or above the minimum level

A major report from the Resolution Foundation earlier this month threatened to put all sort of cats among the pigeons and upset a large number of worms who thought they were safely asleep at the bottom of their metaphorical tin cans.

The central thrust of that report was that home care providers, in some instances, are paying home care staff less than the minimum wage – in some cases no more than £5 per hour rather than the statutory £4.98 per hour for people aged 18-21, and £6.19 for those aged over 21 (there was no attempt, so far as I know, to calculate what proportion of the offences involved under-21s, and therefore implied no criminal behaviour whatsoever).

And, whether we liked it or not, there prevailed, throughout the debate that followed, a sotto voce argument that local authorities are deliberately either encouraging providers to pay below the rates in order to help councils out of their financial woes or turning a blind eye when they see it occurring `in order to save money'.

A quote from the Daily Telegraph alluded to the argument. ‘It is a disgrace that constrained public spending by local authorities, who buy the vast majority of homecare, is preventing care agencies from adequately rewarding the workforce,’ someone from the sector said.

The suggestion here is that local authorities are responsible for this state of affairs although, of course, `preventing care agencies from adequately rewarding the workforce' is subtly different from `giving them no option but to break the law'.

I should, though, like to be rather unsubtle in my response: breaking the law in any circumstances is wrong: directors of adult social services don't do it: don't encourage it, don't condone it and don't uphold it.

A complaint came to me via the Association of Directors of Adult Social Services’ office shortly after the report's release. The complainant demanded ‘evidence that every single one of your members has undertaken a comprehensive cost analysis (to establish...) that their tender rate for homecare services allows commercial organisations to pay the minimum wage’.

Adass was not in a position to supply that information. But the wider issue raised – about local authorities' obligations to ensure minimum wages are paid to employees in the organisations they commission – is vastly complicated. There is certainly no formal obligation.

But I do hope there is an expectation, within commissioning authorities, that the bids put in by companies tendering for local government contracts will include wage costs at or above the minimum wage level. It is certainly something that Adass would urge its members to bear in mind.

Informal arrangements in some parts of the country already exist explicitly among groups of local authorities, and this is to be entirely welcomed. The work undertaken by the United Kingdom Home Care Association (UKHCA) to try to identify a costing model is increasingly being utilised by our members. And I have met with UKHCA to try to progress discussions.

We have assured suppliers that the complexities of the procurement and tendering process for home support services are well understood and that we want to work constructively with them in the field to establish an understanding of best practice to promote across the sector.

But 15-minute slots should be retained; time spent travelling between visits should be paid.

The challenge of creating efficient staff work programmes within the context of variable time requirements based on individual service user need is one that is arguably the most difficult in adult social care. Adass members very much appreciate the position.

But there are two sides to every contract as there are two sides to every story, and it's worth looking at both before coming to a final judgment. We have all lived through extremely difficult times during the past three years and more. Local authorities have faced unprecedented reductions in their budgets, and it behoves us all – commissioners and providers alike – to face the financial realities.

This will inevitably mean belt-tightening on both sides: but those belts must be tightened without impacting on dedicated staff who are among the least well paid in our society.

Home care costs are made up of a number of complex things, which include wages, travel time, overheads and profit. When tenders are submitted, it is not unrealistic for commissioners to believe that all aspects of pricing and unit costing have been considered by the care provider. It is appreciated that margins are tight, but times are tight too.

Adass members, despite the challenges they face, are committed to ensuring they commission the best possible care, from the best possible providers, who will increasingly be using the best trained and remunerated staff possible to care for the vulnerable people they have responsibilities for. That is a goal we should all strive towards.

Did you enjoy this article?