Care companies claim Kent County Council has told them to charge privately-funded pensioners higher fees to make up for the lower fees the authority provides for people without savings.

A critical report by a cross-party committee of MPs says some privately funded people in care who had savings were paying as much as 43% more than those placed in homes by councils with no savings.

That was despite the fact that they had similar rooms and the same level of care.

The report quotes evidence submitted by the Kent Integrated Care Alliance (KiCA), which represents homes with a total of 8,500 beds across the county.

It told the MPs during the inquiry that its members had been advised by the local authority [KCC] that ‘they should look to make profits from the privately funded service users’.

In written evidence, KiCA said:

“Local authority fees are significantly lower than the rate required to provide an appropriate level of care. In a home, privately funded service users can now pay up to 50 per cent more in care home fees compared to the local authority fee rates.”

The organisation also questioned the level of fees offered by the council to cover the introduction of the National Living Wage.

According to a survey of members, 95% said the increase of 1.5% offered by KCC was “too low to be sustainable.”

“Local authority fees are significantly lower than the rate required to provide an appropriate level of care,” it said.

But KCC has strongly disputed the claim.

A statement denied it offered advice about charging.“The comment from Kent Integrated Care Alliance (KiCA), which claims that Kent County Council told providers how to set their fees from privately funded service users, does not reflect the views and policy of the council. It is not the role of the council to tell providers how to set their fees and we have urgently asked KiCA to provide any evidence that such statements were made.”

Under present regulations, anyone with assets over £23,350 must meet their own care bills. Councils step in once a person’s assets fall below that amount.

The MPs’ report stated: “Care providers regularly top up or ‘cross-subsidise’ local authority fees with fees from people who pay for their own care, or ‘self-funders’.”

“Councils are increasingly taking a "price first, quality second approach" in their commissioning of social care, with accounts of some councils paying as little as £2.24 an hour for residential care. The committee found evidence of councils involved in poor consultation and unfair contracts with providers in the social care sector.”

The government recently announced a £2bn injection for adult care services, chiefly to cope with social demographic pressures which is seeing a growing ageing population.

KCC expects to get about £26m in the first year of the fund and about £50m in total over the three year period.