Belfast Telegraph

Northern Ireland care homes under threat

Operator of 25 facilities faces crisis after running out of money

By John Mulgrew

Care homes across Northern Ireland are facing an uncertain future as the UK's largest provider has run out of money.

Southern Cross Healthcare - responsible for operating 25 care homes here - began under-paying its landlords yesterday as if faced up to a bill totalling £230m.

The future of 200 care homes throughout the UK are in the balance after the company announced it has four months to tackle its debt.

The firm, which operates the largest number of care beds in the UK, said it was in a "critical financial position".

Southern Cross Healthcare looks after hundreds of the elderly in Northern Ireland and has care homes in all six counties, including Castle Lodge in Antrim and Greenhall Lodge in Londonderry.

Some of the homes affected also care for young people with severe disabilities such as Longfield in Eglinton, Co Londonderry.

Health regulator RQIA said it was "aware of concerns over the financial viability of Southern Cross" which it is currently monitoring to ensure the "safety and wellbeing" of residents.

In addition to struggling with overdue rent bills, the firm unveiled a £311m loss in the six months leading up to March 31.

It has been hit by declining local authority fees and fewer councils placing residents in its care.

Christopher Fisher, chairman of Southern Cross, said the company was currently in dialogue with the Department of Health.

"We believe that all of the key stakeholders in Southern Cross want this restructuring to succeed," he said.

"Those landlords that do not want to take part in the longer term restructuring will be able to review other options".

Michael McIntosh, regional director for Scotland and Northern Ireland at Southern Cross, said residents in its care homes "do not face the prospect of being made homeless".

"Like all independent care providers, we continue to face challenges because fewer people are being placed in our homes by local authorities, many of whom are seeking to reduce the fee levels they pay in line with public spending cuts," he said.

Health Minister Edwin Poots said he would be concerned if a privately operated firm was facing financial difficulty. He said: "They can ultimately deliver much more cost effectively than we can in the public sector, so we would be concerned if any of them were financially threatened," he said.

Background

Southern Cross Healthcare is struggling with rising rent bills and faces declining local authority fees as fewer councils place residents with the company.

Local authority admissions declined by 15% in the first half of its financial year, though there were more NHS referrals and private patients. Councils and the NHS account for 70% of the company's patients.

The company consequently saw revenues drop 3% to £464m in the first half as overall occupancy dropped by 3% to just under 87%.

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