Before You Vote Tory, Think: Can You Afford £50 for Medicine? Or £50,000 for an Operation

Corbyn’s factual statement that the Tories are considering selling off the NHS to the Americans clearly has got both them and Trump rattled. The Sun’s headline today followed in that wretched rag’s long, ignoble tradition of deceit. It denied furiously that the NHS was for sale, and that Trumped had definitively refuted it. In fact it shouted that he had ‘thumped’ Corbyn ‘the chump’. In fact he hadn’t. Zelo Street has produced a devastating refutation of its own, which demolishes the Scum’s lies. It quotes Trump and his wretched UK ambassador, Woody Johnson, who both side that they wanted the NHS on the table. As well as a report from Sky, which also said they did.

The piece concludes

‘Tory cheerleaders can stamp their feet and cat-call all they want. Trump has already said that the NHS would be on the table in future trade talks. No amount of propagandist knocking copy can change that. Nor can it make Bozo The Clown a competent PM.

The Murdoch mafiosi is now beyond desperate. But you knew that anyway.’

See: https://zelo-street.blogspot.com/2019/12/bozo-and-trump-nhs-denial-busted.html

The Scum would lie about this, as recent biographies of Murdoch have shown that he, as well as the Tories and Trump, want the NHS privatised.

To anyone considering voting Tory anyway, I strongly advise you to think. I’ve friends, who have trained in medicine. And they told me the real price of what some services we so far get free or at least cheap, would cost if we had to pay for them if the NHS was privatised. Some prescription cough medicines actually cost as much as £50, or so I’ve heard. And an operation can cost £30-50,000. These are the kinds of prices you would expect to pay if the Tories, Trump and Murdoch have their way and privatise the NHS, following long-term plans that started with Thatcher.

The leading cause of bankruptcy in America is medical debt. About 40,000 people die every year because they cannot afford proper treatment. In Virginia, people wait overnight in their cars for that one weekend every month when dental treatment is available free. And in some areas people are so poor that they are forced to hoard medicine or get animal medicines from the vets’.

This is what you would get here, if the Tories, Trump, and their backers in private medicine, private equity firms and hedge funds get their way.

We cannot let that happen.

Vote Corbyn to keep the NHS nationalised and free from charges.

 

No, Tweezer! It’s Not Labour that’s Attacking Investment, but Tory Privatisation

More lies from Theresa May, the lying head of a mendacious, corrupt, odious party. Mike put up another piece earlier this week commenting on a foam-flecked rant by Tweezer against the Labour party. She began this tirade by claiming that Labour had turned its back on investment. This was presumably out of fear of Labour’s very popular policies about renationalising the Health Service, the electricity industry and the railways.

But Labour hasn’t turned its back on investment. Far from it. Labour has proposed an investment bank for Britain – something that is recognised by many economists as being badly needed. It was one of Neil Kinnock’s policies in 1987, before he lost the election and decided that becoming ‘Tory lite’ was the winning electoral strategy.

The Korean economist, Ha-Joon Chang, who teaches at Cambridge, has pointed out that privatisation doesn’t work. Most of the British privatised industries were snapped up by foreign companies. And these companies, as he points out, aren’t interested in investing. We are there competitors. They are interested in acquiring our industries purely to make a profit for their countries, not ours. Mike pointed this out in his blog piece on the matter, stating that 10 of the 25 railway companies were owned by foreign interests, many of them nationalised. So nationalised industry is all right, according to Tweezer, so long as we don’t have it.

The same point is made by Stewart Lansley and Joanna Mack in their book, Breadline Britain: the Rise of Mass Poverty (Oneworld 2015). They write

The privatisation, from the 1980s, of the former publicly owned utilities is another example of the extractive process at work, and one that hs brought a huge bonanza for corporate and financial executives at the expense of staff, taxpayers and consumers. Seventy-two state-own enterprises we4re sold between 1983 and 1991 alone, with the political promise that the public-to-private transfer would raise efficiency, productivity and investment in the to the benefit of all. Yet such gains have proved elusive. With most of those who landed shares on privatisation selling up swiftly, the promised shareholding democracy failed to materialise. In the most comprehensive study of the British privatisation process, the Italian academic Massimo Florio, in his book The Great Divistiture, has concluded that privatisation failed to boost efficiency and has led to a ‘substantial regressive effect on the distribution of incomes and wealth in the United Kingdom’. Despite delivering little in the way of unproved performance, privatisation has brought great hikes in managerial pay, profits and shareholder returns paid for by staff lay-offs, the erosion of pay and security, taxpayer losses and higher prices.
(P. 195).

They then go on to discuss how privatisation has led to rising prices, especially in the electricity and water industries.

In most instances, privatisation has led to steady rises in bills, such as for energy and water. Electricity prices are estimated to be between ten and twenty per cent higher than they would have been without privatisation, contributing to the rise in fuel poverty of several years. Between 2002 and 2011, energy and water bills rose forty-five and twenty-one percent respectively in real terms, while median incomes stagnated and those of the poorest tenth fell by eleven percent. The winners have been largely a mix of executives and wealth investors, whole most of the costs – in job security, pay among the least well-skilled, and rising utility bills – have been borne by the poorest half of the population. ‘In this sense, privatisation was an integral part of a series of policies that created a social rift unequalled anywhere else in Europe’, Florio concluded.
(pp. 156-7)

They then go on to discuss the particular instance of the water industry.

Ten of the twenty-three privatised local and region water companies are now foreign owned with a further eight bought by private equity groups. In 2007 Thames Water was taken over by a private consortium of investors, mostly from overseas. Since then, as revealed in a study by John Allen and Michael Pryke at the Open University, the consortium has engineered the company’s finances to ensure that dividends to investors have exceeded net profits paid for by borrowing, a practice now common across the industry. By offsetting interest charges on the loan, the company will pay no corporation tax for the next five to six years. As the academics concluded: ‘A mound of leveraged debt has been used to benefit investors at the expense of households and their rising water bills.’
(P. 157).

They also point out that Britain’s pro-privatisation policy is in market contrast to that of other nations in the EU and America.

It is a similar story across other privatised sectors from the railways to care homes. The fixation with private ownership tis also now increasingly out of step with other countries, which have been unwinding their own privatisation programmes in response to the way the utilities have been exploited for private gain. Eighty-six cities – throughout the US and across Europe – have taken water back into a form of public ownership.
(Pp. 157-8)

Even in America, where foreign investors are not allowed to take over utility companies, privatisation has not brought greater investment into these companies, and particularly the electricity industry, as the American author of Zombie Economics points out.

Lansley and Mack then go on to discuss the noxious case of the Private Equity Firms, which bought up care homes as a nice little investment. Their debt manipulation shenanigans caused many of these to collapse.

So when Tweezer went off on her rant against Labour the other day, this is what she was really defending: the exploitation of British consumers and taxpayers by foreign investors; management and shareholders boosting their pay and dividends by raising prices, and squeezing their workers as much as possible, while dodging tax.

Privatisation isn’t working. Let’s go back to Atlee and nationalise the utilities. And kick out Theresa, the Tories and their lies.

Vox Political on Private Healthcare Overcharging the NHS

18th Century Satirical Print: The Rapacious Quack. It depicts a poor family at the mercy of a doctor, who has taken away a flitch of bacon in lieu of unpaid fees. Its caption reads
‘The Rapacious Quack quite vext to find,
His patient poor, and so forsaken
A thought soon sprung up in his mind
To take away a piece of bacon.’
Which just about describes the grasping attitude of the private healthcare firms mentioned in the report.

Earlier this evening I blogged a piece on Mike’s story over at Vox Political on Ed Miliband’s promise to rebuild and strengthen the NHS. The piece is Will voters support Labour’s vision for the NHS? and it’s at http://voxpoliticalonline.com/2015/01/27/will-voters-support-labours-vision-for-the-nhs/. It offers hope for an NHS decimated by the Tories, but also by Blair and Brown.

Mike also wonders in the piece whether Alan Milburn, Blair’s former health secretary, is really a member of the Labour party, or a Tory, who has worked his way into Labour to undermine it. He isn’t the only one. A few weeks ago, Johnny Void pointed out how one of the authors of the Archbishop of Canterbury’s report suggesting the establishment of a national network of food banks was Frank Field, and made the same comments about him. Field is notorious for recommending further cuts to the welfare state to encourage unemployed hoi polloi to find work. And it isn’t only his critics, who have suggested he should join the Tories. He also has admirers within that party, who’ve actually made the invitation. The politically Conservative Cranmer blog actually invited Field to cross the floor and join the Tories.

And the same comments could have been made about much of the New Labour leadership. Remember the computer programme back in the 1990s that made anagrams from politicians’ names, supposedly revealing their real character? Michael Portillo was ‘a cool, limp Hitler’. Blair came out as ‘I am Tory Plan B’. Lobster compared Blair to Ted Heath. Both were men leading the wrong parties. Giles Brandreth, who served on John Major’s Tory cabinet in the 1990s, on Have I Got News For You described the Blairs, both Tony and Cherie, as natural Tories. They were, and they similarly pursued a policy of privatising the NHS piecemeal.

In the first few years of this century Patricia Hewitt wanted to sell of the £64bn commissioning and supply arm of the NHS, but ended up having to reject the plan, claiming it was mistaken. She therefore just privatised hospital management. And one of the brilliant ideas of Blair’s administration was the inclusion of private healthcare companies to pick up work that could not be done by an overstretched NHS. Who was the brains behind this, ahem, operation?

Alan Milburn.

And in 2009 Private Eye carried a story about an independent report that concluded the private healthcare providers were overcharging the NHS, including billing for work they did not carry out. The article was in their edition for the 15th – 30th May. Here it is.

NHS Plc.
ISTCs: A Crying Sham

Another crumbling New Labour initiative, independent sector treatment centres (ISTCs) for NHS operations, has ben exposed as a shambolic waste of money.

ISTCs were supposed to provide low-cost operations to an overstretched NHS. But the have long been suspected of creaming off the most lucrative ones under favourable contracts without providing the quality to be found in the NHS.

A 2006 parliamentary report questioned their value for money and asked the National Audit Office to look into it. Several billions of pounds of public money were at stake, but the audit body has oddly shied away from the subject despite reportedly expressing some concern over the ISTCs’ performance and £100m+ procurement costs 18 months ago.

Now academics Allyson Pollock and Graham Kirkwood at Edinburgh University have obtained the contract for one ISTC under Scottish freedom of information laws (contracts in England remain confidential). This shows that the NHS in Tayside paid an ISTC run by Amicus Healthcare – a joint venture of private equity firm Apax and South Africa’s Netcare – for 90 percent of referrals even though the centre only performed 32 percent of them. The academics estimate that Tayside’s overpayments could be dwarfed by those across England, where the NHS could have been stung by up to £927m for operations not performed.

The £5bn ISTC programme was pushed through by the Department of Health’s commercial directorate, set up in 2003 by the then health secretary, Alan Milburn, now earning £30k a year from the private equity firm Bridgepoint that owns ISTCs through Alliance Medical. The directorate was run by American Ken Anderson (since decamped to Swiss bank UBS’s private health investments) and was exposed by the Eye two years ago as home to 220 consultants on an average £238k a year, much channelled through tax-efficient service companies. It has since been quietly disbanded without ever having faced the scrutiny it warranted.

This effectively explains why Milburn was so keen to pour scorn on Miliband’s plans for the NHS: he’s working for a private equity firm that will lose work in that area if Miliband starts to take seriously the NHS’ commitment to providing free state medicine.

It also shows how better governed Scotland is than England. The two academics are able to get details like this through the Scots freedom of information act, which is denied to citizens south of the Border.

As for Amicus Healthcare, I remember Amicus as the American rival to Hammer films way back in the 1970s. Although American, they used much of the same actors and production staff. Sadly, Hammer and Amicus passed away, though the horror continues under the Amicus name.

From 2013: Private Eye on Acquisition of Social Fund by Computer Company Owned US Private Equity Firm

This is from the Eye’s edition for 22nd March – 4th April 2013:

When welfare reform minister Lord Freud handed the Social Fund – which gives emergency cash to benefit claimants – over to local councils, he brushed aside criticism and said councils could create “the kind of localist welfare provision they deem to be appropriate and necessary for their areas”.

But many are now contracting out their emergency cash help for the desperately poor to a computer firm owned by US billionaires.

The £178m Social Fund, previously run from job centres, gives small grants and loans to cover benefit claimants’ emergency expenses – to replace furniture after a house fire, say. Despite Freud’s claim that his plan would break bureaucratic centralism, Nottingham recently gave its £10.4m “welfare assistance scheme” contract to computer firm Northgate Information Solutions.

Northgate, which is set to win more such work for other councils (the Welsh Assembly has also hired it to manage its regional version of the scheme), has many contracts running IT, payroll and community charge work for local authorities. But it has little experience of face-to-face work with the poor and desperate. The company does provide profits, however, for the fabulously rich: it is owned by US private equity giant KKR, which run by Henry Kravis and George Roberts, the 84th and 100th richest American billionaires, according to Forbes magazine.

The Eye asked Northgate about its qualifications for welfare work. It stressed that it was “working in partnership with Family Fund, the UK’s largest grant-giving charity”, and pointed to its welfare work on the “Blue Badge Improvement Service” to improve disabled parking badges. So that’s all right then.

This is part of the general Tory policy of cutting welfare and state services, and transferring them to private, largely foreign-owned contractors, like Atos. When questioned recently on the BBC’s documentary programme, Panorama, about the rise of food banks due to the Coalition’s austerity programme, one Tory MP declared that this hadn’t occurred, because the Social Fund was still available, despite the fact that the Tories had just closed it down on a national level. And this article shows that some of the local councils are transferring it to private companies. Again, this follows Tory policies of welfare cuts to the poor, and state support for business and the rich. And the reorganisation and cuts to welfare benefits are increasing poverty, to the point that hunger and starvation is returning to Britain. But as long as the fat cats in the boardroom are happy and profiting, the Tories will continue with their attack on the working and lower middle classes.

From 2010: Private Eye on the Failures of Jarvis, Vertex, Liberata and other Private Contractors

This is the from the Eye’s issue for 17th -30th September 2010:

Outsourcing

A Private Dysfunction

Government cost-cutting plans to outsource more and more services could herald a series of cock-ups as companies running the services go the same way in tough economic times as PFI and rail maintenance company Jarvis and, last week, housing maintenance company Connaught.

Alongside the usual suspects of Capita, Serco et al, many previously unheard of outsourcers are eying up contracts even though they have limited track records and shaky finances. Several are owned by a private equity industry that sees outsourcing as the next quick buck and are accordingly borrowed up to the eyeballs. Fine if they succeed, quick disaster if they don’t.

One such outsourcer is Vertex, chaired by Sir Peter Gershon. As David Cameron’s productivity adviser before the election, Gershon counselled: “a new government faces a massive and complex agenda of driving savings to close the deficit. It ought to simplify this agenda by deciding that all back office transactional functions will be outsourced within 18 months …” Coincidentally, this will hugely benefit his employer Vertex, which already has “contact Centre” and other service contracts with JobCentre Plus and councils including Westminster and Hertfordshire.

Vertex needs all the business it can get. In the two years ended 31 march 2009 it lost £43m, largely because of £35m in finance costs brought about by the huge debts (£215m in 2009) that come with private equity ownership, and which leave Vertex with liabilities exceeding its assets. Since 2008 Vertex has been owned by a consortium of US private equity firms.

Another firm in even firer financial straits is Liberata, which runs finance, payroll, IT, maintenance and any number of other services for councils from Somerset to Manchester and in Whitehall for the Justice ministry and culture department, among others. it is owned by private equity outfits General Atlantic Partners Ltd and GAP-W International, and groans under liabilities exceeding its assets by £67m and losses in the last two years running to £91m. Most arose on its pension schemes, which by last year had run up a combined deficit of £81m. In September, Liberata brought in a Serco and Crapita veteran, Dermot Joyce, to turn things round.

When Jarvis failed to turn things round and went into administration earlier this year, 1,000 “outsourced” workers lost their jobs and there was no money left for redundancy payments. With public services thrown at the mercy of a volatile private equity market, they might well not be the last.

Several of the care homes, which were in the new a year or so ago for poor care and appalling abuse inflicted to their miserable inmates were similarly owned by private equity firms. These firms regarded them solely as a source of profit, and were not interested in providing good quality care to their disabled and mentally retarded wards. They may also have been in similar perilous financial condition.

As for Gershon’s relationship with David Cameron, this seems to be the norm with Tory party politics and privatisation. The Skwawkbox blogged earlier this week about the connection between George Osborne and one of the companies that made a massive profit from the privatisation of the Royal Mail. It’s time this was all stopped.

Private Eye on More Private Equity Firms in Government: Michael Gove Makes John Nash Minister

In my last post featuring an article from Private Eye, I discussed the Eye’s report that the then Tory health minister, Norman Lamb, appeared to be dimly aware that private equity firms actually weren’t very good at running hospitals and care homes. That didn’t seem set to stop them trying to increase such firms owning and running these services, and indeed it didn’t. Just a month later, in their issue for 25th January -7 February of this year, the Eye reported that Education secretary Michael Gove had appointed John Nash as minister. Nash is head of yet another private equity company. The Eye reported

‘Man in the Eye

John Nash

Education Secretary Michael Gove’s appointment of businessman John Nash as a minister suggests he wants private companies to be far more involved in running mainstream state schools.

Nash makes cash through his private equity firm, Sovereign Capital, which invests in higher education and training companies that receive millions for their poor performance on government contracts. Private firms are currently barred from investing in most state schools, but Nash’s new job might include opening up this market.

Given Sovereign’s record, this isn’t great news: it owns the private Greenwich School of Management, whose income from public funds has jumped to £22.6m – almost a quarter of the total going to private universities-since the coalition increased the number of private university courses funded by government-backed student loans (Eye 1330). Alas, when inspectors visited GSM in July student learning opportunities did “not meet UK expectations” and the college required “improvement to meet UK expectations”.

Meanwhile Sovereign’s website boasts of its backing for training firm ESG, which it bought in 2004. ESG training for the jobless was inspected five times by Ofsted between 2007 and 2009 and never received a single “good”. Inspection reports found “achievement and standards are inadequate”, a “low rate for job outcomes”, “slow progress in implementing quality assurance arrangements”, “insufficient resources in some centres” and “some poor learning resources”.

Despite this ESG won a £69m Work Programme contract from the Work and Pensions Department-and stumbled here too, failing to meet a 5.5 per cent minimum target for getting people into jobs. Sovereign says it sold ESG last July after it won the Work Programme contract, but documents at Companies House show Sovereign still owns about 20 per cent.

Press coverage of Nash’s appointment mentioned his investment in the Conservatives (he and his wife have given £300,000 to the party-and he now has a seat in the House of Lords and a government job!) but his Sovereign role wasn’t discussed because the Department for Education failed to mention it when announcing the appointment. The government did say Nash would step away “from all relevant business interests” while serving as minister. Sovereign Capital declined to comment.’

So the government is appointing yet another businessman from a private equity firm to oversee its privatisation of yet more state institutions. The private equity firm involved has an abysmal record in running those institutions it does possess. Its chairman is nevertheless rewarded for his persistent failure with a seat in the House of Lords, and position in government. It’s basically business as usual then, with the only difference being that this time it’s education that will suffer, rather than hospitals.

Private Eye: Has Norman Lamb Finally Recognised Private Equity Firms Should Not Run Healthcare

This is story from the 11th December-21st December 2012 issue of Private Eye, reporting that Norman Lamb appears to have cottoned on to the fact that private equity firms running hospitals and other healthcare facilities is recipe for disaster. It states

‘Private Equity

Not-so Super Model

Health minister Norman Lamb has finally recognised what the Eye has been saying for ages: that the tax-driven ownership structure behind companies providing some of the most sensitive public services, such as care for the vulnerable, puts them at huge risk.

Companies such as Castlebeck, behind the abusive Winterbourne View home (Eye 1290), the Rochdale children’s home that was supposed to be looking after girls sexually abused by gangs, all operated on the same financial model: highly-geared with expensive loans from funds (often offshore) that remove any profits the taxman might get his hands on but also leave the “businesses” themselves highly vulnerable to economic downturn.

The model increasingly extends now to other outsourced services – such as forensic science, for example, where offshore fund-owned LGC Forensics recently contributed to the wrongful five-month detention of a man on rape charges after cost-driven lapses at one of its labs. As Eye 1325 noted, the report by the Forensic Science Regulator on LGC was highly critical.

Then of course there are the scores of hospital PFI contracts now held at least partly by private equity funds (Eyes passim ad nauseam).

In a consultation on care home regulation, Lam has at last promised to “challenge business models that could compromise quality”. But lessons of the last decade have yet to be learned, it seems, as his consultation document promises there will be a “light touch”. Such was the approach to financial services regulation that led to Northern Rock and 2008 crash. Good one, Norm.’

In other words, Lamb and the Tories are aware that private equity firms running healthcare doesn’t work, or at least, not as well as they’d hoped. They don’t want to admit, and don’t want to do anything about it, except issue vague statements about quality when the scandals become too great to ignore.

So it’s pretty much business as usual then.

Private Eye on Abuse and Neglect at Beech House Private Care Home

After covering several stories of abuse and neglect at private care homes, Private Eye ran another story about the poor care given to adults suffering from learning difficulties and ‘challenging behaviour’ at the private Beech House hospital in Newmarket in their 24th August -6th September 2012 edition. Here it is.

‘Care Homes

A Private Concern

More evidence emerges that big business and private-equity firms are among the worst offenders when it comes to running poor care homes.

Last month Eye 1319 revealed how the ever-expanding Priory Group and Craegmoor-owned by the American private-equity firm Advent International – were the owners of two of the 18 homes and hospitals found to be failing to protect its young disabled residents during Care Quality Commission inspections.

Another found by the care watchdog to have “major concerns” was Beech House in Newmarket, an independent hospital that houses 30 adults with learning difficulties and challenging behaviour. Inspectors found residents were “being restrained unnecessarily ” by staff who were “authoritarian” and “very controlling”. All external and internal doors were locked, even though this was a “low secure hospital”.

Issuing enforcement notices against the hospital, inspectors concluded that patients were “not being protected from abuse, or the risk of abuse”.

Beech House is part of the Four Seasons group, which also owns six homes listed as “moderate concern” by the inspectors. Four Seasons has been bought and sold by private-equity firms for years: Terra Firma, the private-equity outfit run by Guy Hands, was the latest to buy it, for £800m in April.

Another of the 18 presenting “major concerns” was Elmsmead in Taunton, a home for a dozen young adults with learning difficulties, where inspectors found poor care planning and a “strong small of urine” in the lounge, suggesting poor continence care. Elmstead is part of the Voyage Care chaine of homes, which also runs the Rhodelands home in Devon, where inspectors recorded “moderate” concerns-and Voyage Care is owned by private-equity firm HG Capital.

Overall in its inspection of 150 institutions, the CQC found that privately owned “independent” homes were twice as likely to fail at both care and safeguarding as those run by the NHS. Eye readers know well the debacle surrounding the collapse of Southern Cross (private-equity owner, Blackstone), the largest provider of care for the elderly – much of it poor.

But the government remains ideologically wedded to greater private investment in health and social care from its business mates and associates. Guy Hands is a close friend of William Hague, and Ian Armitage, chair of HG Capital, gave £30,500 to David Willetts “research fund” and the Tory party between 2007 and 2010.

* Now taxpayers’ money is also being handed over to private enterprise from the care watchdog itself. For the past two years the CQC has been handing monthly sums, in the region of £500,000 or above, to Carlisle Managed Solutions, for staff and services to just about every division of the commission, from registration to regulation, from finance to intelligence – and even to the chair and chief executive’s office. So far Carlisle Managed Solutions has pocketed some £13.66m. It just happened to be owned by Impellam, the so-called global “human capital services company”-owned by the family trust of none other than tax-haven enthusiast and Tory party benefactor Lord Ashcroft.’

So there it is in black and white: privately run hospitals are more inefficient, and offer worse care than the NHS. But thanks to their connections to Tory leaders like Hague and Ashcroft, they’re set to be give more of the NHS.

Private Eye on Failure of Care at More Care Hospitals owned by American Private Equity Firms

I blogged yesterday on the scandalous conditions and abuse of patients at Winterbourne View, a residential hospital run by a private equity firm. Looking back through Private Eye I found more cases of neglect and abuse of people with learning difficulties in care homes run by the Priory Group, owned by Advent International, another private equity firm. This article was published in their 27th July-12th August edition last year.

‘Care Homes

Priory Engagement

The Priory group and its Craegmoor subsidiary boast that they “transform lives”. but they seem less happy to see their brand on their ever expanding care home portfolio when things go wrong.

When the Care Quality Commission’s unannounced checks revealed shortcomings in facilities for the learning disabled, no criticism was levelled at “Europe’s leading specialist care provider” to tarnish its self-proclaimed “unrivalled reputation”. That is because two of the group’s homes criticised by the CQC for failing to protect the safety and welfare of its young residents, Lammas Lodge in Hereford and Melling Acres in Liverpool, are registered in the name of Parkcare Homes, which took all the blame and bad publicity in the specialist media.

In September last year, following an anonymous tip, inspectors found residents at risk of abuse in Lammas Lodge, a home for young adults. There were not enough staff and what staff there were, inspectors found, were not properly trained to meet residents’ complex needs. There were six major areas of concern, including care and welfare, medication and safeguarding. The home, which was warned it must improve or face closure, has since been given a clean bill of health by the regulators.

Not so Melling Acres, where inspectors reported major concerns in May about the care and welfare of its seven residents – care plans were poor, with scant information about physical health needs, there were limited activities and a lack of advocacy to enable people to express concerns about their care.

The Priory Group and Craegmoor are owned by the American private equity firm Advent International, whose continuing expansion into the industry (it has recently acquired 11 Harbour Care homes on the south coast) is causing some concern.

The collapse last year of Southern Cross showed that care homes, private equity and poor financial and care regulation can lead to a toxic cocktail for the people in care. Sale and leaseback deals on the care home property portfolio itself enabled profits to be creamed off by Southern Cross’s private equity owner, Blackstone, before the credit crunch meant Southern Cross could no longer afford its landlords’ rising rents.

As Eye readers may recall, Philip Scott – the former Southern Cross chief executive who was in charge during the boom years but bailed out, selling his personal stake for £11m just before sales started to plunge-went on to become CEO at the Priory Group. Interestingly, he has this month announced he is to quit.

Is history about to repeat itself? The group has recently reduced its earnings forecast by 7 per cent, blaming the squeeze on NHS budges for a fall in patients. Will Scott retain his equity stake in the group-and will he continue to rent various care properties back to the Priory Group via his property companies? Watch this space.’

I’ve no doubt that there are care homes excellently run, where their patients are comfortable and well-looked after. The combination of private equity firms, which are primarily interested in making a quick, big buck, and residential and care homes is too vulnerable to exploitation and abuse, however.