Forget big business or the state, cooperatives should run care homes

Due to an unknown but certainly high number of deaths in UK care homes, attention has now pivoted from hospitals to the care sector and rightly so. For too long this aspect of healthcare has remained hidden, facing eye-watering cuts and continual privatisation to the point where it is estimated that 84% of beds are now privately-owned.Nearly one-fifth of these are taken up by the big five providers but why is this an issue?

By their own metrics, this model of ownership is failing, with two of the big five providers going into administration in recent years. According to a report commissioned by the Institute for Public Policy Research, this is a result of their reliance on high amounts of borrowing, cost-cutting practices, low staff pay and complicated corporate structures. A problem that is hampered by the fact that social care is a high-cost activity, similar to healthcare.

In fact, the distinction between healthcare and social care is a false one. The care that people receive in care homes is often nurse-led and incorporates their ‘health’ needs. The division of the two sectors is a political decision taken to alleviate the government of a duty to provide care to certain sections of society.

The study concludes that not only is the large corporate business model financially unstainable but also detrimental to quality. Evidence of less training for staff, higher turnover and lower pay all contribute to deteriorating quality of care. Not only is the care possibly worse but it is also becoming more expensive for the general public.

A study of 12 county councils “found that service users who funded their own stay paid over 40% more than those funded by local authorities for the same services”. Further evidence suggests that smaller residential or care homes provide better quality of services, in contrast to the ever-expanding large corporate providers. For this problem of social care in the UK, the IPPR provides two solutions, either the state provides or “innovative not-for-profit providers” step in. Forget the state, this is where co-operative ownership can play a vital role.

The concept of co-operatively-owned care homes was passionately championed by James Murray MP in a parliamentary meeting on user-led social care. The argument underpinning the model is that it provides a democratic, equitable, staff-led and community-orientated option to public or private social care provision, allowing for surplus capital to be reinvested into the business to improve quality and reduce costs. You’d be mistaken in thinking this a new concept, cooked up by the left to counter for-profit providers but in other countries this in fact a fully-functioning and economically viable model of care. Japan has proved fertile ground for the development of social care co-operatives with the Japanese federation of health and welfare co-operatives currently running 28 nursing care homes, in addition to 75 hospitals and 337 primary health care centres.

In Bologna, Italy social co-operatives account for 85% of care services for children, the elderly, the poor, the disabled and other vulnerable people and they exceed state and corporate alternatives in their outcomes, for example, these co-operatives give superior care at 50% of the cost of state programs.

What these two examples share in common is that they are both examples of multi-stakeholder co-operatives. A type of ownership model in which not only the workers own and run the business but so do the users, local citizens, external investors and volunteers. It contributes to a system that can be more sustainable, just and efficient than other types of co-operatives.

Equally, alternative co-op models can improve job satisfaction for nurses in what is traditionally an undervalued profession. Community Home Care Associates is the largest American worker co-op. Despite the industry being traditionally low paid with low satisfaction rate and high employee turnover of around 40-50%, the co-op has an employee turnover of just 15%.

Work is already underway promoting the co-operative model in the UK through the owning our care initiative. The Welsh government has been nurturing a co-operative social care movement with examples like the Cartrefi Cymru Co-operative, a multi-stakeholder co-operative that provides services to people with learning disabilities and has been successful in generating a turnover of more than £23 million. Why then hasn’t the model already taken off? Well, partly because, as always, political will is important in fostering a legal and economic environment that allows co-operative organisations to develop and flourish.

Boris Johnson promised before the 2019 general election that he would fix the “crisis” of social care in the UK and there is in fact somewhat of a tradition of promoting co-operatives within groups within the Conservative Party. There is even a conservative co-operative movement headed by MP Jesse Norman.

If we are to have another conservative government live out its full term, social care cooperatives could be an area of substantial reform attracting cross-party support.

In addition to this, we also need to start educating people on, promoting and starting social care co-operatives, if the movement is to take hold here in the UK as it has done so effectively in other parts of the world. True co-operatives that follow the 7 principles, should be the future of social care in the UK and all parties should make an effort to ensure there is continued support and the opportunity for them to develop.

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