Birmingham care home plans ditched as land values slump
Plummeting land values have ended Birmingham City Council’s ambitious plan to build six more modern care centres for elderly people.
Social services bosses say they can now only afford to run the four nursing and residential centres which have already been opened.
The full complement of ten – where residents have their own en-suite bathrooms and the use of cafes and restaurants – were to have been paid for by closing 29 old people’s homes and selling the sites to developers. But the amount that can be raised by disposing of the land has collapsed during the recession from £22.3 million to just £4 million.
The council still intends to shut all of the old people’s homes it owns over the next few years, partly because the buildings require extensive refurbishment to bring them up to modern care standards and also to reflect falling demand for traditional public-sector residential care.
Most of the residents currently living in the threatened council-run homes are likely to be transferred to homes in the independent sector, which already provides accommodation for 75 per cent of Birmingham people in residential care.
Birmingham Social Services will hand independent providers £1 million to help improve the services they offer.
The decision to stop building the care centres, which will be rubber-stamped by the cabinet next week, means that the council will lose a £45 million Private Finance Initiative grant from the government. The sum was based on the city contributing at least £20 million from land sales toward the cost of the centres. Plans for the fifth care centre, at Woodington Road, Sutton Coldfield, were at an advanced stage, but will now be scrapped.
It remains unclear whether the six remaining care centres will ever be built.
Sue Anderson, the cabinet member for adults and communities, said she was disappointed at having to halt the programme but there was no option if the council was not to be left with an “expensive legacy” which it could not afford to run.
Each 34-bed wing in the centres costs £25,000 per week to run – money which Coun Anderson believed could be spent more effectively elsewhere.
Coun Anderson (Lib Dem, Sheldon) added: “We are one of the few local authorities left that still has so much in-house provision. We are improving the quality of external providers and driving up the quality.”
She promised the council would choose only the best independent and voluntary sector providers. Coun Anderson and Peter Hay, the strategic director of adults and communities, insist that increasing numbers of elderly people are rejecting residential care in favour of a mixture of independent-sector community care.
Mr Hay said: “We are seeing a significant shift and there is a question over how much residential care we actually need.”
He said Birmingham, in common with other councils, was struggling to meet the cost of delivering services for a growing elderly population.
