Hundreds of thousands of pounds in delayed payments for care packages delivered by Scotland’s independent care sector is jeopardising the ‘vital services’ they provide, Scottish Care has today revealed.

Every single social care provider surveyed by Scottish Care reported that they are operating with payments overdue from local authorities.

The average amount owed to the 42 care provider respondents beyond 30 days was £303,986 – across all the cases shared, this totals more than £6m.

Public contracts should be paid within 28 days, but Scottish Care has uncovered that 62.8% of care providers are still waiting on late payments more than 60 days, causing ‘immense’ pressure on an already burdened sector.

The representative body for the independent social care sector in Scotland is calling for urgent short-term investment to ameliorate the funding shortfalls.

Scottish Care adds that there must be an immediate end to late payments for the delivery of care packages, and prompt payment of owed monies to affected services.

The set up of a National Care Service, with a move toward ethical commissioning and an independent care sector representative on governance bodies responsible for the service, is also seen as an opportunity to improve the situation for out-of-pocket care providers. Some providers have reported waiting months and even years for payments from local authorities.

Scottish Care highlights that this is not just affecting large corporations, but also many smaller providers – in some cases charitable organisations.

Just one of the survey respondents said they charged interest on late payments.

If all the survey respondents charged interest on the basis of 30 day late payments alone, it would cost £243,188.80.

Payments ‘critical’ to service survival

The members surveyed shared the impact such delays have on their ability to deliver care, with one Care at Home provider saying:

‘Our tendered care packages are accepted and delivered without issue, yet we wait months for eventual payment.

‘The time we spent chasing these payments, critical to our ongoing survival as a business, could be spent delivering the care our clients need and deserve.’

Scottish Care says that some may have to seek loans to cover their costs, with one care home provider explaining the impact on the sustainability of their services across multiple local government authorities:

‘Across these, we’ve been underfunded for provided care due to delayed and erroneous financial assessments. We’re owed over £300,000, on top of significant efforts and time to reclaim owed monies, and the confusion and difficulty placed on residents and/or their families.

‘The sustainability of our various homes and their ability to offer quality care in locations across Scotland is dependent on a timely and accurate financial assessment from the local authority.

‘In a time where we, and the rest of the independent sector, need to grow to meet rising demand, this inadequate commissioning of services like ours further burdens our operations and the care our homes provide.’

It comes just a day after COSLA called for action on the long-term underfunding of Scottish local governments as the 2024/25 budgets set by councils reveal a £585m collective shortfall.

COSLA’s Resources Spokesperson Councillor Katie Hagmann said this reinforces previously raised concerns over the “severe challenges” facing local councils trying to balance the books and deliver essential services:

“It is vitally important that these concerns, which have been consistently raised by COSLA leaders and are now backed up by evidence presented by the Accounts Commission, are acted upon for the sake of Scotland’s public services and our communities who rely upon them.

“We must seek a sustainable solution to these long-term issues in order to protect the essential front-line service of our communities before it is too late.”

While recognising the financial challenges extend across service providers and local authorities, Scottish Care says the delayed payments to care providers reflects an ‘undervaluation of social care’.

Scottish Care says it is committed to working alongside local authorities to remedy these issues and ensure the ongoing delivery of care and support across Scotland:

‘This undervaluation of social care is in stark contrast to independent services’ foundational importance to Scotland’s economy, and the ability to save significant sums of money through a preventative approach that addresses issues such as delayed discharge.

Read more: Carers facing full force of health and care crisis; Feeley: NCS still an opportunity for transformation; Self-directed support organisations boosted; Uncovering the hidden role of carers in Scotland; Action for social care workers “can't wait”

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