Homecare Association Response to the Independent IT Review of the Care Quality Commission

The Homecare Association expresses deep concern following the publication of the Independent IT Review of the Care Quality Commission (CQC). This reveals significant failures in the regulator's £99 million IT transformation programme.

Dr Jane Townson OBE, CEO of the Homecare Association, said:

"The findings of this report confirm what our members have been experiencing for many months – a regulatory system that is not fit for purpose, creating unnecessary burdens for providers already operating in challenging circumstances.

"We are particularly alarmed by the revelation that 20,000 notifications went unprocessed for up to a year. This is more than a system glitch. It represents a serious risk to the oversight of care quality and safety that the CQC is mandated to provide.

“£99 million later, and we’re still asking where  the accountability for squandering provider fees and government grants in this way is?

"While we appreciate the transparency this review brings, the lack of clear timelines and costs for remediation is concerning. Our members need certainty about when these systems will be fit for purpose, as they remain stuck with clunky workarounds and manual processes. They continue to  divert valuable time and resources they simply don’t have.

"The recommendation to mandate the use of the Provider Portal for all notifications may have merit for standardisation, but we insist this must only happen after the portal is demonstrably reliable, accessible, and user-friendly for all providers regardless of their size or digital maturity.

"We urge the CQC to stop designing systems in a vacuum. Providers on the ground must be part of co-designing solutions. Our members' experiences should be central to rebuilding these systems, not an afterthought.

The Homecare Association stands ready to work constructively with the CQC to ensure that regulatory technology supports rather than hinders the delivery of high-quality care.

Dr Jane Townson OBE, CEO of the Homecare Association, said:

“We urge the Department of Health and Social Care to ensure adequate funding is provided to resolve these issues promptly, rather than allowing costs to be passed on to providers through increased fees."

--ENDS--

Contacts

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Notes to editors

1. The Homecare Association is the UK’s membership body for homecare providers, with over 2,200 members nationally. Its mission is to ensure homecare receives the investment it deserves, so all of us can live well at home and flourish in our communities. The Homecare Association acts as a trusted voice, taking a lead in shaping homecare, in collaboration with partners across the care sector. It also provides hands-on support and practical tools for its members. The Homecare Association’s members agree to abide by the Association’s Code of Practice.
2. The care sector comprises 18,500 PAYE employers, 10,850 of those are non-residential and 7,650 are residential (Skills for Care 2024). Total market value is £35.3 billion (LaingBuisson 2024), contributing £68.1 billion to the economy.
3. Local authorities and the NHS buy 70-80% of all care services (LaingBuisson 2024).

• 96% of supported living.
• 89% of care homes for younger adults.
• 79% of homecare.
• 57% of older people’s care homes.

4. NHS funding represents 25% (£1,692 million) of the total funding for homecare (£6,656 million). The rest comes from councils (50%; £3,348 million); direct payments (3%; £212 million); private-pay (21%; £1,375 million); and other (1%; £30 million) (LaingBuisson 2024).
5. The fee rates local authorities and the NHS pay now are too low to cover costs (Homecare Association). Only 1% meet our Minimum Price for Homecare of £28.53 per hour in 2024-25. This will rise to £32.14 per hour in 2025-2026, as detailed in our new Minimum Price for Homecare report.
6. Employment costs, representing 70-80% of providers’ total costs, will surge by at least 10% in 2025-26. This is driven by increases in employers’ national insurance contributions and minimum wage requirements. We provide detailed analysis in our Minimum Price for Homecare 2025-26 report.
7. Providers cannot pass on these increased costs as local authorities and NHS bodies, their primary customers, fix prices. Many councils cannot balance their books and directors of Adult Social Services must cut budgets by £1.4 billion.
8. Key findings from a recent Care Provider Alliance survey show that without immediate government intervention:  

• 73% will have to refuse new care packages from local authorities or the NHS.
• 57% will hand back existing contracts to local authorities or the NHS.
• 77% will have to draw on reserves.
• 64% will have to make staff redundant.
• 92% of providers who also serve people who pay for their own care will be forced to increase rates for self-funders. Many self-funders will be unable to bear extra costs and may reduce care or rely more on family carers.
• 22% are planning to close their businesses entirely.

9. Profitability in the state-funded sector has plummeted over the past decade (LaingBuisson 2024).

• Homecare average EBITDA margins have fallen from 10.8% to a low of 5.2% in 2019, with some recovery to 7.6% in 2024.
• Care homes for younger adults have seen EBITDA margins halve from 26% to 13%
• Older people’s care homes serving mainly state-funded residents have seen margins fall by 50%

10. Despite some perceptions, private equity involvement in the care sector is limited. Just 12.2% of older people’s care homes; 10.1% of younger adult care homes; and 12.2% of homecare/supported living services are private equity backed.