Care charges questioned after council-owned company reports record profits

The level of charges for services provided for vulnerable people by an Essex County Council arms-length company has been defended after it posted record profits.

Essex Cares Limited with an income of £48.6 million made a net profit of £3.65 million in 2023/24 after pensions and tax – a record since ECL began trading in 2009.

A dividend of £1.7 million is forecast to be paid to Essex County Council as the sole shareholder.

However, the level of profits has been questioned given the people who ECL is responsible for looking after are some of the most vulnerable in communities across the southeast.

ECL describes its work as providing “care and support to thousands of people to live safely and independently within their own homes and local communities in South East England”.

Its services support older people, adults with learning disabilities, adults receiving reablement services and people with sensory impairment.

Leader of the Lib Dem group at Essex County Council Councillor Mike Mackrory said at cabinet on June 25: “If you look at this as a standalone business it is doing very well. It’s got an excellent rating and so on. It made a profit last year albeit it might not be quite so high this coming year.

But it did strike me that of course the clients who are people with learning disabilities, autism, vulnerable people, the elderly- I do wonder whether we are charging those vulnerable people rather too much which is contributing to those profits.”

Leader of Essex County Council Councillor Kevin Bentley said: “On the general question, do you charge too much? The answer is always yes of course in most people’s eyes.

It’s the quality of service that matters and the quality of service that is being provided. And I would argue the quality of service is excellent from Essex Cares Ltd.

Whether you think that is too much is in the eye of the beholder because the answer will always be yes.

“My view is its good market value for what we offer and the services people get.”

ECL, a wholly-owned organisation of Essex County Council, employs over 1,200 people and delivers community reablement, sensory services, day centre services for older people and for adults with learning disabilities and autism, and inclusive employment services in Essex.

ECL also delivers community reablement services in the London Borough of Havering and in West Sussex, as well as some reablement provision in the London Borough of Barking and Dagenham.

In January 2021, ECL set out a medium-term business plan covering the period 2021/22-2025/26. This set out a vision “to be the care provider of choice”. The medium plan also set out 4 priorities – including to grow existing relationships.

The Essex reablement contract grew from 5,000 hours a week in 2020 to over 9,300 hours a week by 2023, and new ward-led enablement services commenced in each of the five Essex acute hospitals in early 2023.

A new five-year sensory service started in October 2023. However, in July 2023, ECL exited the community equipment service in Essex.

It also wants to develop a private pay business. Income from private payers in day centres and sensory services grew from £949,000 in 2021/22 to £1.5m in 23/24.

Plans were established to enter the private domiciliary care market in 23/24 via a service called Care Solutions but this was paused following a strategic review.

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Piers Meyler

Local Democracy Reporter