The rise in the living wage is putting a massive strain on a Huddersfield day centre for adults with special needs … and its manager feels many other charities, community interest companies and care businesses will be struggling too.

The Waves centre in Slaithwaite pays its staff the living wage which went up from £10.42 to £11.44 an hour from April 1, putting around £1,800 extra into the pay packets of full-time staff each year.

The pound an hour rise is virtually a 10% hike which is great for staff but puts the centre under immense financial strain, pushing its monthly wage bill up £20,000 to around £200,000.

Waves manager Ben Wright said care organisations, charities and community-based groups are left to largely shoulder the extra financial burden caused by the living wage increase themselves.

One option to meet the shortfall would be to increase the price of day care, but people with additional needs and their families would struggle to afford it. They get personal budgets from Kirklees Council for their social care, but there are no plans for these budgets to rise.

Ben said: “This is particularly impactful for us in the adult care sector due to the high staff-to-client ratios required for providing quality care, unlike businesses focused primarily on product sales.

“While a product-oriented company might generate £1m annually with minimal staff, achieving the same revenue in care services needs a significantly larger workforce.

Ben Wright, managing director of Waves

“The core issue isn’t the wage increase itself but the mandate from the government to elevate pay scales with no additional uplift to meet this additional cost.

“Essentially, we find ourselves in a challenging position. On one hand we are under pressure to increase our staff’s wages, but on the other we’re restricted from doing so because the local council has not matched the mandated wage increase that we were not responsible for initiating.

“This leaves us caught in a bind, lacking the authority either to refrain from raising pay or to adjust our charges to cover these increased costs.”

He said he was in talks with Kirklees but the outcome looks gloomy at the moment.

“We are faced with the challenge of implementing uniform pay rises amid stagnant fee negotiations with the council,” said Ben.

“As our monthly wage bill hovers around £200,000, this adjustment translates to an additional £20,000 monthly expense. Over a year, this discrepancy could result in over a £200,000 shortfall, posing a significant financial challenge for us.”

Waves members selling plants outside their day care centre in Slaithwaite

Ben is proposing a 7.8% increase in the daily charge to help manage the increase in costs, although other options are being considered.

He said: “One approach could involve reducing staff ratios which would undoubtedly impact the quality of care we provide. Alternatively, I could present a business case for reducing staff hours.

“However, this would place our staff in a difficult situation. It would mean that despite the general rise in wages leading to higher expenses for living costs, such as food and services, we would need to reduce their hours to the point where their monthly take-home pay remains unchanged. Essentially, our staff would have to shoulder the financial strain.”

He said another option could be to reduce the range of services but the fear then is that people who attend the centre would become dissatisfied and look for an alternative care centre.

Ben added: “I understand we are not alone in facing these challenges. Reports suggest that other companies are also struggling.”

Richard Parry, strategic director for adults and health at Kirklees Council, said: “Waves daycare centre in Slaithwaite is a private company that does not contract directly with Kirklees Council.

“With regards to personal budgets for disabled people, these are issued in line with the Care Act as an alternative to organising a direct provision for an individual.

“Therefore, these budgets are managed by the individuals themselves or a nominated person on their behalf. Kirklees Council can provide a review of the individual’s care needs and care plan if the direct payment manager no longer feels that the budget is sufficient to meet the needs outlined and agreed upon in the care plan.”

Written by ANDY HIRST who runs his own Yorkshire freelance journalism agency AH! PR ( specialising in press releases, blogging, website content and copywriting.

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