Northamptonshire County Council: 'Mistakes' made in care contract

image captionThe leader of Northamptonshire County Council said its contract with a private care home provider was "one of the worst" in the country

A former leader of a cash-strapped council - which is paying up to £2m a year for empty care beds - has admitted "mistakes were made" in the signing of the deal.

The 25-year elderly care contract was negotiated by Northamptonshire County Council in 2003 under Labour.

The authority said this week the centres had been operating below 30-50% occupancy for several years.

The previous leader said the deal was "unanimously accepted".

The problems with the contract - a private finance initiative (PFI) - emerged on Monday in a document which set out the council's "stabilisation plan" to save £65m this financial year.

The deal, with Shaw Healthcare, paid for four specialist healthcare centres for vulnerable elderly people, but the council said the centres were operating below capacity and it was spending between £1.5m and £2m a year on empty beds.

Additionally, the authority said it was paying up to £1.6m a year on alternative beds for patients who did not qualify for the specialist care.

Mick Young, the Labour leader of Northamptonshire County Council in 2003 when the deal was negotiated, said: "Obviously, mistakes were made around some of the details and, in hindsight, the 25-year term was a mistake, as it's impossible to predict the future.

"It's all very well for people to turn it into a political tennis match now, but at the time the contract was signed, it was the view that this was the only thing that could be done, and it was unanimously accepted by the council," he added.

The contract

  • The 25-year contract, with private firm Shaw Healthcare, was to provide 204 rehabilitation care beds across four centres for people leaving hospital or following a crisis at home.
  • Not every patient qualifies for a bed, under the contract terms, and the council said between 30 and 50 are empty at any one time, but are still being paid for, at a cost of between £1.5m and £2m per year.
  • In addition, the council said it spends between £1m and £1.6 per year on alternative care beds for patients who did not qualify.
  • The council said it has unsuccessfully tried to have the contract changed to enable more people to fill the empty beds.

The current Conservative council leader, Matt Golby, said it was "one of the worst PFI contracts in the country".

"We have a duty to provide the best value we can for the council taxpayers of Northamptonshire," he said.

A spokesperson for Shaw Healthcare said: "It would be inappropriate for us to comment at this stage but we can confirm that we do have a PFI Contract with the council and that we remain committed to working with the council to help it provide the best value for money for the council and the people of Northamptonshire."


Government-appointed commissioners were brought in earlier this year to oversee the authority, which has twice banned new spending, and is due to be scrapped and replaced in 2020.

image captionNorthamptonshire County Council will be scrapped and replaced in 2020

Dexter Whitfield, from the campaign group People v PFI, said: "It's mind-boggling, to be honest. I've looked at hundreds of PFI contracts and I've seen the bad and really bad, and this one is a particularly extreme example."

The county council said "options are being explored with Shaw currently and in conjunction with the Department of Health PFI team".

A Department of Health and Social Care spokesman said: "We have been approached by Northamptonshire County Council with regard to the council's PFI contract with Shaw Healthcare that covers areas of social care and are exploring with all parties how the contract is working before any further action is taken."

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