New "care home village" for Southend will cost over £22million

Last month, we told how Southend Council is to set up its own business to run a new care home, to replace Priory House in Westcliff, and Delaware House, in Shoebury, as the buildings are run down.

But leaked documents show that the authority’s plan resembles more of a “care village”, featuring a 60-bed dementia care home, learning disability day care centre, and 54 extra care apartments that will be sold or rented out, on the site of Priory House, off Prittlewell Chase.

But the local authority trading company that will be set up will face heavy losses of £660,000 in its first year, and only break even after four years, and is scheduled to make a profit after that.

But consultants have warned that there are a series of financial risks behind the scheme, including the reliance on NHS funding, and opposition councillors have questioned whether the business case is strong enough.

Southend Independence councillor James Moyies, who is responsible for health and adult social care. Said: “No project like this is without risk, but we are no longer in a world where we can just continue to do what we have always done, so quite simply we must be ambitious and deliver this project.

“We have real opportunity to become a leader in the way care is delivered through the development of an adult social care campus for the borough.

“More work now needs to be done to fully cost options and consider the funding and financing implications. At the present time we cannot comment on this work but look forward to revealing more details in due course.”

The documentation reveals that the company could be set up from April, with council leader Ron Woodley regularly saying his authority needs to be more business-like.

Currently in both Delaware and Priory, 30 of the residents are funded by the NHS’ Continuing Care Funding, for people in poor health, which is worth £1,100 per resident per week. Estimated at 34 per cent of the income from the care home, the report warns there could be serious risks involved if this funding falls through.

And John Lamb, leader of the opposition Tory party on the council, said: “It’s not a good business case, it really isn’t. I like the idea, but we would run it in a different way. What that is, we would have to work out, but we are not in power.

“They have a business plan, but how are they going to do that when there’s a lot of uncertainty in the future, especially over people care. If we’re not careful, it’s going to be a drain on money that will need subsidising, and how can you subsidise something when your means of income is reducing?

“What we don’t want to do is promise residents something that is unsustainable.”

He also questioned whether the authority will recoup its £22.9million outlay on the project, with the care home and day centre costing £11.3million, and the extra care apartments costing £11.6million, built in two phases.

The authority would also need to buy up land from the nearby Priory School, in Burr Hill Chase.

History behind the scheme

Protests in 2013

If a new care home campus is built, it will bring an end to a saga that saw both Priory House and Delaware House facing the axe.

A cross-party group of councillors in 2013 concluded both care homes, the only two in the borough still run by Southend Council, were unfit for purpose, and should close down.

This policy was then taken on by the former Conservative administration, who pressed ahead with plans to close both them down, despite huge uproar.

At the time, the Tories wanted to build a dementia facility on the site of Delaware, in Shoebury.

However, their plans sparked mass protests and more than 15,000 people signed a petition demanding both care homes were kept open.

When the current administration took over in 2014, it immediately put the decision on ice, and spent the rest of the year reviewing it.

It then come up with the idea for an improved care home campus, which has been worked up since.

What is a local authority trading company?

Local authority trading companies (LATCs) are free to operate as commercial companies but are owned by the council.

In the case of this one for the care home campus, the profits generated will go into the upkeep of the business, but the council can also benefit from lease payments from the company, as well as dividends.

The primary source of income from the LATC will actually come from the council, who will be in effect commissioning the care home service.