Author: Alain Catzeflis
There’s rarely an easy answer to a complex issue. And few issues are more complex than how we fund and deliver care humanely with limited resources in 21st century Britain. If and when Jeremy Corbyn and John McDonnell come to power this will test their mettle like nothing else.
A case before the Court of Appeal later this month perfectly captures this conundrum: how to reconcile social ethics – looking after citizens in dignity and safety - with a fiscal system that in theory requires, as it should, a level playing field for all at a time of punishing austerity.
The case, known as the ‘sleep-in’ crisis, is about care providers mostly for people with learning disabilities, who face a bill of at least £400m after the government reversed its decision that “sleep-in support” - where carers are present overnight but rarely called upon - is exempt from minimum pay legislation. Charities says if the government doesn’t step in some providers could go to the wall.
The case is partly about money of course. But it’s also about values: the value we place on a sector in deep crisis as the neo-liberal model thunders on, price-tagging anything that can be monetised; and where that sector - and those human beings - fit into a world whose organising principle is the survival of the fittest.
It pits two pillars of social justice against each other: the need to provide 24-hour care for vulnerable people in residential facilities at a cost that is affordable; and the right of workers to a living or at the very least a minimum wage.
It is also a story of lazy government thinking in the face of repeated warnings by charities that the issue was a time-bomb waiting to explode.
Most social care providers who use overnight workers pay them the National Minimum Wage (NMW). This in itself raises questions about how we value someone who looks after the most vulnerable people in society but let us leave that to one side for now.
When the worker sleeps-in and is on call, but can stay in bed when they are not needed, they get paid a flat rate of around £30 which represents less than half the National Minimum Wage (NMW).
This has been custom and practice for years. It has allowed many charities to keep their head above water. Workers in a cold economic climate where zero-hour contracts are the norm have been happy enough to accept this bargain in return for a steady job.
However, in the past few years, flat rates have been challenged in court by some overnight workers. In a case in 2013 an employment tribunal judge made the very reasonable point when finding in favour of the worker, that if he couldn’t leave his bed to get some fish and chips then he was working and should be paid the NMW.
Then in April 2017 Mencap, the charity that runs homes for people with learning disabilities, lost an appeal at an employment tribunal over the amount it paid carers who slept-in.
The tribunal ruled that the charity had been wrong to pay a support worker £29.05 for a nine-hour sleep-in shift or nearly £4.30 per hour below NMW. Carers have in fact been following official guidance on this since the NMW was introduced in 1999.
Soon after Mencap lost the appeal, HM Revenue & Customs (HMRC) said they would demand six years back pay from the charity. HMRC insists it must be scrupulously impartial. Mencap and the sector as a whole now face an unaffordable bill running into hundreds of millions of pounds. The Court of Appeal will review Mencap’s case this month. Proponents of an unfettered labour market have seized on the case with glee as a cautionary tale against ‘meddling’ with wage legislation. The right of centre, Centre for Policy Studies wrote in February: “The chaos and confusion of the sleep-in situation in social care should be a cautionary tale for the Labour Party and their plans to ban zero hours contracts. Yes, there are abuses …but employees and employers both value flexibility.”
The government has responded with a compromise that gives providers longer to settle up but merely kicks the can down the road. Providers will be given twelve months to conduct a 'self-review' and pay arrears by 31 March 2019.
No new funding was announced. The government said it was “exploring options to minimise any impact on the sector” and with breath-taking irony, as it pursues a hard Brexit, that it was discussing with the European Commission “whether any support, if deemed necessary, would be subject to EU state aid rules.”
Whatever the outcome of the case in the Court of Appeal the government will not allow charities to go under leaving vulnerable people exposed to risk largely as a result of its failure to address a looming crisis it was repeatedly warned about. A way will be found of finessing the situation perhaps by writing off the arrears.
On the face of it everyone in the case is at least half right: the charities for taking advantage of poorly defined tax guidance to keep their homes going; the government for introducing a NMW; the workers who demanded their right to the NMW for sleep-ins; HMRC for pursuing arrears and Mencap for appealing.
The Court of Appeal will almost certainly rule on a narrow point of law. It will not address the underlying questions posed by the crisis. That is a matter for Parliament not the courts. In its 2018 report the prestigious King’s Fund made the obvious point that the system for funding social care is in urgent need of reform. Many people’s care needs are going unmet. It added:
“There is little sign of a long-term solution on the horizon. Since 1998, there have been 12 green papers, white papers and other consultations, as well as five independent commissions, all attempting to grapple with the problem of securing a sustainable social care system. It has been called ‘one of the greatest unresolved public policy issues of our time.”
As many of us have argued time and again our care system needs root and branch reform. The challenge is immense. But tinkering with a system which is fundamentally flawed is not the answer. The Conservatives - at any rate these Conservatives - regard welfare as a privilege to be earned and care as commodity that can efficiently be outsourced to the market. It is, at best, benign neglect.
But it has to be said that beyond some specific policies such as tidying up Universal Credit or throwing more money at a failing system it is not obvious that Labour has an overarching vision of how such reform can be achieved.
The ‘sleep-in crisis’ is a not just a bump on the road. It is a symptom of a deeper confusion about the priorities we set ourselves as a nation. We will not come up with a sustainable solution to the crisis until we recognise that there is one and that it is tearing at the fabric of society.
The publisher is the Centre for Welfare Reform.
Workers' Rights Versus the Right to Care © Alain Catzeflis 2018.
All Rights Reserved. No part of this paper may be reproduced in any form without permission from the publisher except for the quotation of brief passages in reviews.
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