11/24/2015
Mitie, a leading provider of social care in the UK has called for immediate reforms within the care sector.
The only solution to the crisis according to Mitie is to merge the health and social care budgets and to issue sweeping reforms.
"Once made, this change will create a more integrated service, with a much simpler path through it and a better experience for individuals caught in the middle of the current arrangements," the company said.
"However, change has been slow and a faster pace in integrating NHS and social care would benefit all parties involved - the individuals receiving care and their families, the providers of care, the commissioners of care, and the taxpayer - none of whom are 'winners' under the current arrangement."
Mitie warned that the government’s unwillingness to implement effective changes quickly means that pressure is mounting on councils which are trying to make do on shoestring budgets.
Nevertheless, the CEO of Mitie, Ruth McGregor-Smith was optimistic about the new living wage and what it will mean for carers. She said that employee turnover would be minimised and that employees would begin to feel more rewarded for their contributions.
The additional costs would not mean that Mitie is forced to cut jobs as some had feared. She said,
"We do expect outsourcing prices to increase in the future and will not be advocating job cuts in reaction to this change. However, we will continue to work with our clients to identify cost efficiencies in other areas. The vast majority of our client base has been supportive of our approach."
Mitie has recorded losses of £2.1m and a 19% slump in sales, however this is largely due to the company restructuring itself by closing down several branches.
Mcgregor-Smith remained upbeat despite the immediate challenges. She explained that "the growing elderly population will ensure that there is a demand for healthcare services, and that people are increasingly opting for live-in care in the comfort of their own homes, rather than the stress of a hospital or residential home.Our average charge rates are rising and we expect the introduction of the national living wage to support this trend. We have also seen some consolidation in the market, where we are being awarded more work as the lead provider, rather than as one of a large number of providers."
Investec analyst Andrew Gibb echoed McGregor-Smith’s opinion that Mitie would do well in the long term.
"With its core UK facilities management business trading strongly, alongside improvements in social housing, we continue to believe the group is well placed for the medium-term."
Written By:
Daniel James
