Social Value in Public Policy by Bill Jordan

Author:Bill Jordan
Language: eng
Format: epub
ISBN: 9783030604219
Publisher: Springer International Publishing

The Genesis of the Problems

The underlying issue for this field in social policy was the growth in the numbers and proportion of the UK population aged 70 and over. Between 2008–9 and 2018–19, those in England aged 65–74 increased by 21 per cent, aged 75–85 by 14 per cent, and aged over 85 by 20 per cent. Of all those over 80, 44 per cent needed some kind of help with daily life. Meanwhile policies for de-institutionalisation in the fields of mental illness and mental handicap had led to the establishment of large numbers of small-to-medium-sized units in communities, some run by local authorities, others by private providers. Many residents were older people.

Under New Labour, a White Paper on services for adults (Department of Health 1998) had criticised local authorities for failing to support people with disabilities and chronic illnesses in their homes. The personal social services had for some time been shown to have difficulties in meshing with family and neighbourhood networks of support for older people (Finch and Groves 1984). Research by Challis and Davies (1985) had shown that lack of flexible and intensive packages of home care had caused unnecessary admissions to residential homes – an experience which the sociologists Miller and Gwynne (1972) had characterised as ‘social death’.

However, it took a number of scandals and deaths of care residents for the system to be reformed. Under the 1990 Act, 90 per cent of care provision was to be in privately owned homes, rather than ones owned by local authorities. Between 1980 and 2001 the proportion of residents in private homes rose from 18 to 85 per cent; by 2005 it was 90 per cent (Johnson et al. 2010, p. 236). A number of companies owning such homes went bankrupt in the financial crash of 2008–9, but by far the most notorious such collapse was that of Southern Cross in 2011.

At the start of that year, Southern Cross owned 750 care homes all over Britain, employing 44,000 staff and accommodating 31,000 residents, of whom about 70 per cent were funded by local authorities. In the North East of England they were providing 30 per cent of all care home beds (House of Commons Public Accounts Committee 2011). But this situation represented the outcome of a frenzied round of transactions which had little to do with the well-being of frail elderly people, and a great deal to do with financial capitalism.

In September, 2004, the New York-based equity giant Blackstone had acquired Darlington-based Southern Cross Healthcare, a company with New Zealand origins, for £162 million, which had previously been owned by a similar firm, West Private Equity, for two years (Drakeford 2006; Scourfield 2007). Then Blackstone sold off the freeholds of these homes, partly to help finance the purchase of another huge group of private nursing homes, NHP, based in Surrey, which also managed another 165 homes through its subsidiary company, Highfield Care.

These transactions were motivated entirely by profit; Blackstone simultaneously bought a German chemicals company, the Dutch telephone directory supplier VNU, and a French cinema group.

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