Homecare Association responds to the Co-operative Party report on co-operation in care

The Homecare Association welcomes the Co-operative Party’s report, The Power of Co-operation in Care, and the debate it opens, while cautioning that its central proposition is an over-simplification, not fully supported by the evidence.

Responding to the report, Dr Jane Townson OBE, Chief Executive of the Homecare Association, said:

“We welcome a serious debate about how to fix social care, and there is much in this report we agree with. Making large profits while delivering poor care and exploiting workers is indefensible. An effective regulatory system would be finding and stopping that wherever it happens. And the report is right that the commissioning system is broken: many councils and NHS Integrated Care Boards (ICBs) now balance their tight budgets by driving down the price of care - too often below the cost of delivering it safely and fairly. Fixing commissioning and funding must be a priority.

We are proud that Be Caring, one of the country’s leading employee-owned providers, is a member of the Homecare Association and that its chief executive, Sharon Lowrie, chairs our board. Co-operative and employee-owned providers can be excellent, and we champion them. But Be Caring succeeds because it is well led, not simply because of its ownership model.”

The Association’s concern is with the report’s core argument: that profit is the central problem in social care and that not-for-profit, co-operative ownership is the answer. This is an over-simplification, not fully supported by the evidence.

Townson said:

“The evidence points to leadership, culture, commissioning and funding as the decisive factors in whether care is good quality and workers are treated fairly, not profit in itself. The NHS is publicly owned and operated, and it contains both shocking failures of quality, safety and fair treatment of staff, and examples of exemplary performance. It is the same in the care sector. The recently reported cases of terrible neglect of people with learning disabilities involved both not-for-profit and for-profit providers. Ownership model per se simply does not predict quality.”

The Association noted that the report’s own contributors made similar points. Every interviewee identified commissioning and funding, not ownership, as the key barrier to better quality and fairer employment.

Townson said:

“Read the interviews and the same theme comes through again and again: a commissioning system that buys at the lowest possible price, and chronic underfunding. I agree wholeheartedly with Sharon Lowrie of Be Caring that the best providers succeed despite the commissioning system, not because of it, and that around nine in ten tenders are simply not viable for an ethical operator.”

The Association is also concerned about one model the report holds up, in which self-employed unregulated care workers deliver care. This leaves citizens without safeguards and care workers without employment rights, and pulls against the Government’s own agenda on quality, safe delegation, neighbourhood health, joined-up care and digital transformation.

The Association also questioned the report’s call to copy Wales, which has legislated to remove private profit from children’s social care and which the report urges England to follow. It noted that early indications from Wales are not encouraging, and that the Local Government Association, councillors and the Children’s Homes Association have all warned the change has not been properly funded.

Townson said:

“The report points to Wales as the model, but the early signs show this as a warning, not an example to follow. A Senedd committee has heard that the policy has backfired, leaving councils with fewer services and little choice but to pay more while some remaining providers make hay. The change was not properly funded, and that is the lesson. There is also a striking irony. Under the Welsh Act, providers must take one of four not-for-profit forms, none of which can have share capital. That means an employee-owned business like Be Caring, which gives shares to its employees and which this very report holds up as a model, could not register to provide children’s services in Wales. Removing profit without fixing funding simply moves the problem and risks destabilising provision for children and adults at risk.”

The Association added that the report’s picture of the market does not match the data. While the report states that 80% of the largest care home groups are owned or backed by private equity, those large groups form a minority of the market. The ten biggest care home providers hold under 20% of the market between them, and homecare is similar, with the largest provider under 3%. Independent analysis by LaingBuisson shows private equity ownership at 13.7% of older people’s care home capacity and 12.8% of homecare and supported living. The sector is fragmented and comprised primarily of small and medium-sized owner-operators who have invested their own money.

Townson said:

“In homecare, the financial reality is the opposite of the picture being painted. Data from the statutory accounts of larger homecare providers show an average operating margin of 8.7% in 2024/25. Many SMEs are struggling to break even as employment costs have risen faster than income. Where councils pay below the cost of care, and almost a third do, providers are subsidising the state. And every organisation, public or private, needs to make a surplus to remain resilient and to invest in its people, its systems and the technology that improves care. Banning profit would deter the very owner-operators the sector relies on and would do nothing about the real problem, which is funding.”

The Association said the route to quality care and better pay and conditions is to fix commissioning, fund care adequately and ensure the regulators perform. It called for a statutory minimum price for homecare, properly funded fair pay, and commissioning that buys for quality and value rather than the lowest hourly rate, and said it would continue to work with the Casey Commission, government and partners across the sector, including co-operative and employee-owned providers.

ENDS

Notes to editors

1. The Homecare Association is the UK’s largest membership body for care providers and the leading association advocating for homecare, representing organisations of every size and ownership type across England, Wales, Scotland and Northern Ireland. Our flagship Minimum Price for Homecare (£34.42 per hour for 2026/27) sets out the price required for providers to pay carers fairly and operate sustainably: https://www.homecareassociation.org.uk/resource/minimum-price-for-homecare-2026-2027.html
2. The Homecare Association’s Homecare Deficit 2025 Report shows that 29% of councils and Health and Social Care Trusts are paying fees lower than the direct employment costs of careworkers on the minimum wage, leaving less than nothing to contribute to other running costs: https://www.homecareassociation.org.uk/resource/the-homecare-deficit-2025.html
3. Market structure figures are from LaingBuisson, the sole independent company contracted to the Office for National Statistics to provide statistics on the independent health and social care sector: https://go.laingbuisson.com/homecare-report-7
4. Be Caring is a 100% employee-owned social enterprise providing home care and learning disabilities services across the north of England, rated outstanding by the CQC, and a member of the Homecare Association. Its chief executive, Sharon Lowrie, chairs the Homecare Association board. https://becaring.org.uk/
5. The Homecare Association has published an analysis of the Care Quality Commission’s performance, setting out significant shortcomings in the regulator’s effectiveness: https://www.homecareassociation.org.uk/resource/unseen-and-unrated-more-than-four-in-five-community-social-care-services-in-england-have-no-current-cqc-rating-new-analysis-finds.html
6. Wales: the Health and Social Care (Wales) Act 2025 removes private profit from children’s social care, phased between April 2026 and 2030. Concerns about funding and unintended consequences have been reported, including a Senedd committee session in November 2025 (Nation.Cymru, “Private care providers ‘making hay’ as plan to restrict profits ‘backfires’”: https://nation.cymru/news/private-care-providers-making-hay-as-plan-to-restrict-profits-backfires/ ) and earlier scrutiny in which the Chartered Institute of Public Finance and Accountancy warned of risks including contract hand-backs and market failure: https://www.communitycare.co.uk/content/news/bill-to-remove-profit-from-childrens-care-in-wales-approved-by-senedd

Under section 6B of the Act, a non-local-authority provider of a restricted children’s service must take one of four not-for-profit forms: a charitable company limited by

guarantee without a share capital, a charitable incorporated organisation, a charitable registered society, or a community interest company limited by guarantee without a share capital. None may have share capital, so an employee-owned business that issues shares to employees (such as Be Caring) could not register. A co-operative could qualify only in charitable registered-society form: https://www.legislation.gov.uk/anaw/2016/2/section/6B

7. CIPFA submitted written evidence (reference HSCWB27) to the Senedd Health and Social Care Committee's Stage 1 call for evidence on the Health and Social Care (Wales) Bill. The consultation ran from 24 May to 28 June 2024. The full response is published on the Senedd's website. The Chartered Institute of Public Finance and Accountancy (CIPFA), written evidence HSCWB27
   https://business.senedd.wales/documents/s152569/HSCWB27%20-%20The%20Chartered%20Institute%20of%20Public%20Finance%20and%20Accountancy%20CIPFA.html