CARE home bosses have warned that the sector faces a crisis if funding from local authorities is not increased.

The Bournemouth, Dorset and Poole Care Providers Federation, an umbrella organisation representing 105 homes across the county, says the fees paid by councils to private homes do not meet the costs of providing care to their state-supported residents, who make up around 20-30 per cent of the total.

The body warned that if fees are not increased then many homes across Dorset face potential closure and declining standards for residents, and may have to overcharge private tenants to cover the shortfall.

"Recent care home and care agency closures are due to the low fees paid by local authorities," said federation president Brian Westlake.

"This underfunding over such a long time is not only denuding the industry but lessening the possibility that people will get sufficient, quality care in the future."

Mr Westlake said the federation and affiliated Dorset Care Homes Association had met with local authorities in 2013 to discuss funding. They commissioned a study by Morris Lane accountants which determined that the cost per week of caring for frail older people was £609, rising to £661 for older people with dementia and up to £827 with nursing costs included.

However, the average fees paid by local authorities were calculated to amount to only £476 per week for care without nursing, and £585 for care with nursing, leaving a substantial shortfall.

"Care homes haven't had a rise in fees for four years, we wanted to come together to establish what would be a fair fee," said Mr Westlake.

"The local authorities decided they had identified some savings and brought it down to about £550 a week. Then they said they couldn't accept the figure they had come up with themselves."

The federation was due to meet with the county's local authorities on January 21 to conduct a second review, which the body hoped would come up with a method for consistently calculating a "fair fee" rising each year to meet demand, however the meeting was cancelled by the councils.

Mr Westlake said the sector is facing a perfect storm of challenges including a severe shortage of care home managers, care assistants and nurses exacerbated by generally high levels of employment nationally. He said homes were struggling to afford wages in line with candidates aspirations and also the rising minimum wage.

At the same time, he said, the Care Quality Commission's new "robust Ofsted-type approach" to inspections is an added worry for care home owners "struggling to maintain and pay a working staff".

The county's local authorities have acknowledged the pressures the industry is facing.

Ali Waller, Dorset County Council's head of partnerships and performance, said a review this year would look into "how costs have changed" in light of the minimum wage, pension auto-enrolment and other changes, and would lead to recommendations being made to the council cabinet.

"The county council recognises that all social care services have faced sustained financial pressure, alongside a marked reduction in funding available to councils, in recent years," she said.

"It is clear that providers have a differing cost base - depending upon a range of factors such as size of home, financing, loan arrangements, and we would want to ensure that we are able to take these into account."

She said it was not clear from the council's own figures that it was "under funding" its placements.

"The county council's influence on the sustainability of homes is limited, and for example, the council only fills about 20 per cent of vacancies within the market, with 80 per cent of vacancies being filled from other sources," she said.

"Of the placements made by the council, we individually negotiate rates in over 50 per cent of such placements, which helps to ensure a closer reflection of the needs of individuals and the costs of meeting these."

A statement from Borough of Poole said: "The care home market is a complex one with in excess of 290 homes across Dorset, Poole and Bournemouth of which the three LAs and the NHS purchase a significant proportion of the beds for the most vulnerable and frail in our society.

"It is important to recognise that some homes, dependant on their size, are more cost effective to run than others and the costs should reflect a business model that is sustainable and meets the individual care needs of the residents living there.

"Bournemouth and Poole councils recognise the increasing pressure care homes are under and have increased the price paid for care, since the 2013 review referred to, against a backdrop of decreasing financial support from central government, and are looking to undertake a review of the cost of care, in partnership with providers and colleagues in Dorset County Council and Dorset CCG, in the early part of 2016.

"This review will help inform the future fee rates paid by councils and the NHS for those eligible for public funding support."

Care homes closed in recent months 

SEVERAL care homes in Bournemouth and Poole area have closed in recent months, with plans submitted to demolish or redevelop the buildings as flats.

Pinebeach Nursing Home, at Friars Cliff in Christchurch, closed earlier this month amid speculation that the land might be sold for development.

In October, the Daily Echo revealed plans to demolish the family-owned Canford Cliffs Rest Home in Bessborough Road and replace it with a block of 14 flats, and just a few weeks earlier plans were put forward to demolish the former Marlborough House nursing home in Poole, owned by Bournemouth businessman Abdul Jaffer, and replace it with a four-storey block of 12 flats.

Marlborough House, in Bournemouth Road, had been shut down after a damning CQC report rated it 'inadequate', and its residents were moved elsewhere.

Back in August, another care home owned by Mr Jaffer, Ormonde Nursing Home in Branksome, was also submitted for demolition and redevelopment, and a third, Avalon, was deemed "not economically viable" by administrators Begbies Traynor and closed.

In all three cases the applicants claimed the businesses are no longer commercially viable.