The government believes the financial impact of sleep-in care workers’ back-pay on adult social care charities is a "significant risk" to the future of social care in the UK, according to Jeremy Hunt, the health secretary.
In a letter to the Conservative Sarah Wollaston MP, chair of the Health and Social Care Select Committee, Hunt says the government recognises the challenges for charities to pay up to six years of back-pay to sleep-in care workers and is working on a solution.
The health secretary’s letter has come in response to a letter from Wollaston in which she called for an urgent solution to the issue of sleep-in care back-pay and warned that her committee would take action if the government did not act soon.
The government changed its guidance on sleep-in care workers last year after two tribunal rulings left care charities facing a back-pay bill for six years of arrears, which the learning disability charity Mencap estimated would total £400m.
Charities that use sleep-in carers had previously typically paid a flat rate of between £35 and £45, plus an hourly rate for any time spent providing care rather than being asleep. But the revised guidance said the carers should be entitled to the minimum wage for the entirety of their shifts.
Last year the government asked charities to sign up to a scheme that gave them 15 months to pay off any arrears.
But charities and umbrella bodies have repeatedly said that expecting charities to pay back-pay would threaten the financial viability of the sector, and a letter from 35 organisations, including Mencap and the Voluntary Organisations Disability Group, called for the government to address the problem before HM Revenue & Customs begins collecting back-pay from charities in November.
In Hunt’s letter, dated 13 June, he says that the government wants to "minimise impact on the sector" and has explored how this could be done without contravening EU state-aid rules.
The government has also analysed the potential financial impact of back-pay liabilities on the sector, Hunt says, and will share that analysis with the sector once the government has decided on a solution to the back-pay issue.
The letter also highlights that the government is aware of the deadline for when a solution is needed "and continues to work to explore options for support, should it be deemed necessary".
Mencap is awaiting the outcome of a High Court appeal, heard in March, against the government’s back-pay decision.