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A judge today refused to rule the decision of Birmingham City Council not to pay more money to the owners of old pe...
A judge today refused to rule the decision of Birmingham City Council not to pay more money to the owners of old people's homes as 'unlawful' - despite hearing it could endanger future care.

The owners of six care and nursing homes in the city had argued the council is jeopardising the health of elderly and vulnerable residents by refusing to cover the 'true cost' of looking after them.

They claimed that unless paid more money, they could go bust, leaving old people with nowhere to go.

But Mr justice Stanley Burnton, sitting at London's high court, said: 'The care home owners have failed to establish the position of the council is bound to lead to insufficient capacity, or to a failure to provide for stable, long-term care for those in need.

'It is clear from the council's internal documents that it took into account the need to make such provisions and the risk of loss of capacity to meet the demand for care homes in the future.'

The judge added that questions of 'affordability and the allocation of resources' are for 'the democratically elected executive and legislature, not for the courts.'

In dismissing the home owners' judicial review challenge of the council's 19 June decision not to up rates of pay, he went on to say the council had a 'fiduciary duty' not to waste tax-payers' money.

The judge also said the courts should be 'slow to intervene' when the council and the care home owners were discussing new contracts.

'There has been a long process of consultation and the local authority and the service providers are, in effect, engaged in contractual negotiation with the local authority,' he said.

The home owners - who had formed the Birmingham Care Consortium - complained that residential care of the elderly had, for years, been seriously under-funded by the city council.

Their barrister, Robin Green, added that the under-funding of residential care for the elderly had already resulted in closure of 80 care homes in the city in the past 18 months.

The council had commissioned an expert inquiry on the level of fees paid to private homes and, in a report in April this year, a 'fair' price for residential placements was recommended which was 'significantly higher' than fees paid by the council.

But Mr justice Burnton said although the council were offering£347 - compared to the£401 rates suggested by the report - the difference could to some extent be explained by other factors.

'It follows the claimants have failed to establish the rates offered by the council in the letter 19 June 2002, are less than fair rates,' he added.

Birmingham offered care home owners a 3% raise in fees in May, but home owners say that 'bears no relation to the actual cost of providing care.'

Observing there was 'confusion' over the figures put forward by the council and the Birmingham Care Consortium, Mr justice Stanley Burnton said it resulted from a 'failure to specify clearly the assumptions behind the figure or statement in question'.

'The scope for confusion is increased by the fact there are current minimum standards and ones that until recently were expected to come into effect in 2007,' he said

Mr Green had earlier argued that in August the council itself admitted that the fees on offer were 'inadequate', but said it needed five years - until July 2006 - to gradually increase them to a 'fair' level.

In a hearing last week, Mr Green had said the care homes 'cannot survive on less than an economic return' and the inevitable result of the council's refusal would be yet more home closures at a time when more places are needed by an aging population.

The care homes involved in the dispute were:

*Uplands Nursing Home, run by John and Cherie Linton, in Selly Park

*Bethany House, run by Joseph Rodrigues in Erdington

*Erdington-based Elizabeth Lawrence Rest Home Ltd.

*Kings Norton-based Northfield House Ltd

*Maundsley Hall Nursing Home Ltd, of Kings Norton.

*Kingsmere Nursing Home, run by Robert Smith, in Kingsbury Road, Birmingham.

Mr justice Stanley Burnton ordered the Consortium must pay only one-third of the council's legal costs incurred before 30 August, after ruling the council had, to a 'significant extent', brought the case upon themselves.

He added that until that date, the most 'important factor' behind the Birmingham Care Consortium's legal challenge was an admission by the council that they could not afford to pay the 'true' cost of residential care.

From 30 August onwards, the care consortium must pay all the action's legal costs.

The care home owners were refused permission to appeal against the judge's refusal to uphold their judicial review challenge.


A press release from Birmingham City Council follows.

Susanna McCorry, Birmingham City Council's cabinet member for social services and health, said:

'We welcomed the decision for a judicial review as it gave us the chance to have our policy fully considered by the court.

'The Birmingham Care Consortium's case was only supported by a minority of the care homes in Birmingham.

'This hearing enabled us to put our case across and we feel that the city council's position has been fully vindicated. We will now be hoping to re-establish a dialogue with the Birmingham Care Consortium to face together the challenges ahead in elderly care in Birmingham.'

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