Care home company cash crisis puts jobs at risk

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A CARE home provider with 27 sites in South Yorkshire has announced it may close 200 of its 750 properties across the country.

Southern Cross Healthcare is facing a cash crisis, with its share price having fallen from £4 to 10p, and needs to cut costs by £100 million. The company says its current rent bill is ‘unsustainable’ and landlords have already been asked to defer some of the payments they are due.

The company has 31,000 elderly and vulnerable residents - and trade union the GMB has warned that 44,000 jobs could be at risk.

John Smith, organiser at the GMB union, which represents Southern Cross staff, said: “The situation at Southern Cross is very serious.

“People playing politics, profits and interest rates with the welfare of 31,000 elderly and vulnerable residents who have served this country all their lives is totally out of order. It is a modern outrage made even worse as there are also 44,000 jobs at stake.

“The 750 plus care homes run by Southern Cross, including the 27 in South Yorkshire, are not factories that are failing from lack of demand but are an essential part of every community which now face ruin due to the combination of privatisation and private equity.”

In South Yorkshire, Southern Cross has 16 homes in Sheffield, plus five in Rotherham, four in Doncaster and two more in Barnsley.

Southern Cross has said it is looking for an investor to help it resolve its cash crisis, which has been caused by a combination of public spending cuts and a rising rent bill to the 80 landlords of its properties.

Further problems have been caused by declining occupancy, which has fallen to 83 per cent, from 91 per cent.