The Funding Question for the Charity and Not for Profit arms of the Social Care Sector. Author Julie Hopkins (ownacarehome.com)

The rise in the cost of living is a major challenge for all businesses and individuals alike as employees seek higher wage increases above the national living wage to combat the challenges that this brings.

The charity and not for profit sectors need to ensure that they have a robust capital base which can address the reward and remuneration of the professional care sector, and go some way towards parity with the NHS, especially as we approach the integrated journey with health and social care working together. 

The ‘Market Sustainability and Fair Cost Fund’ is a step in the right direction as part of the government’s 10-year vision for reform in the ‘People at the Heart of Care white paper.’  The funding of care has a long way to go with the charity and not for profit branches of social care seeking to continuously adapt along the way.

When collating evidence for a finance application to the wider lending market, the independent finance brokers at Chandler & Co look at the underlying strength of the funding proposal before underwriter submission.  Key credentials for the charity and not for profit social care sector include the ethos and culture at the heart of the care provision with increasing emphasis on environmental, social and governance (ESG) measures.

A typical business plan when addressing ongoing and future funding of a care business needs to address the sustainability of its funding model, its effective workforce strategy alongside an experienced management team.  As part of an ESG strategy, the charity and not for profit sectors benefit by looking at other sectors who have started their decarbonisation journey, with a growing uptake in the B Corporation ethos, or parts of it.  CEO at SaveMoneyCutCarbon and Ownacarehome.com supplier partner, Mark Salt, has announced a new partnership with Wave Utilities, helping to ‘turbo charge companies’ adoption of energy and water efficiency to achieve the Uk’s net zero carbon target.’

The charity and not for profit care sectors have other areas of focus to the traditional business model.  This includes demonstrating to the beneficiaries that their governance and best practice strategies reach those that they care for with strong, sustainable cost management.  There must be transparency of message combined with organisational resilience.  The risk appetite of the Trustees has an increasing focus, with one case study showing a move away from the purchase of freehold care homes to a leasehold model, typically with a 35-year duration.  There must be clarity on where the funds are coming from, how the business overheads are managed, and how sustainable the servicing of debt is for the longer term.  Whole Board engagement and strength of governance will add resilience to the charity and not for profit care sector as they navigate the road ahead.

Working alongside professional partners (visit the ownacarehome.com how we help section) can add an additional layer of strength and support to the charity and not for profit branches of social care as we look ahead into the next decade.