Verdict on care home fees

CARE home charges will come under the spotlight today when the Government publishes its report into whether consumers are being ripped off.

The Office of Fair Trading has been investigating the care homes market for the past 10 months following a so-called super-complaint from consumer group Which?

The OFT is expected to criticise care home companies for overcharging consumers and failing to help the most vulnerable people.

More than half-a-million people are in care homes, but there have long been suggestions that some are being exploited by unscrupulous operators.

The super-complaint, which was supported by charities including Help the Aged and Age Concern, was prompted by worries that private patients are subsiding those paid for by local authorities, and a lack of legal protection for consumers.

However, controversially, the OFT ruled out examining whether local authorities are abusing their dominant market position to negotiate bulk discounts for those residents whose bills they pay.

Last month, a Help the Aged report found that care home fees have risen by a third over the past five years, leaving many pensioners struggling to pay.

Philip Spiers, of the Help the Aged care fees advice service, said: 'With the cost of care home places escalating over the past few years, but retirement income growth remaining sluggish, the task of raising the money to meet the expense of care is becoming increasingly complicated.'

He added low interest rates have also eroded pensioners' savings. 'Capital put aside but just left in banks and building societies will not generate the level of income required and can also quickly diminish.'