Living wage will hit Northern Ireland's nursing homes, says expert
Northern Ireland nursing homes face a difficult 2016 as margins tighten with the introduction of the National Living Wage, an industry expert has said. The sector employs around 9,000 people in NI, working across approximately 400 homes.
Last year, Four Seasons, a UK company that's the biggest private sector operator of homes in NI, said it would be shutting seven of its properties in the province.
But three have been bought out by home-grown nursing home operators, with the third deal - a purchase of Hamilton Court care home in Armagh by Sanville Nursing Home - finalised last week.
The sums involved in the deals - in which a total of around 177 jobs were saved - have not been disclosed. Spa Nursing Homes bought Oakridge Care Home in Ballynahinch, Co Down while Hutchinson Care Homes bought Antrim Care Home.
Antrim is home to 24 people, Oakridge has 58 residents while Hamilton Court has 31.
But closures have gone ahead of Victoria Park and Stormont care homes in Belfast, Garvagh Care Home in Co Londonderry and Donaghcloney Care Home near Banbridge. A proposed sale of Garvagh home collapsed.
Mr O'Kane, who acted on behalf of the buyers in the Ballynahinch and Antrim deals, said all operators would find 2016 a tough year as the National Living Wage is introduced - and as nursing shortages continue to bite.
The minimum wage of £6.70 per hour will be replaced for the over-25s by a National Living Wage of £7.20 per hour in April. The minimum wage will remain in place for workers of 24 and under.
Mr O'Kane said: "The viability of a lot of homes will be tested when the National Living Wage is introduced.
"That's going to have a massive impact as a lot of staff are on the minimum wage - and those on higher grades of pay will also expect incremental increases in line with how the minimum wage will have gone up."
The sector received a boost earlier this month when Health Minister Simon Hamilton said he was making £1.6m available for recruiting staff and providing care home packages in the independent sector.
And it's believed the sector could get further help when the National Living Wage is introduced in April. Mr O'Kane said that the cost of nursing is typically 60% of a care home's turnover - but that this could spiral when agency staff are employed.
It's understood the prices obtained for the care homes in Ballynahinch and Antrim reflect the high cost of care, with both heavily dependent on agency nurses.