The privatisation and financialisation of social care in the UK

The first few months of Covid 19 put immense strain on the provision of social care in the UK, as care homes initially bore the brunt of the pandemic. However, the care sector was already in crisis, significantly fragmented after three decades of privatisation, and underfunded following ten years of austerity. Yet, the impacts have been uneven, and a narrative of underfunding overlooks the inequalities generated by the structures that underpin provisioning. Most private care companies operate on a small scale and many are family-owned. But a growing share has been taken over by financial private equity investors, drawn to the secure revenue stream offered by an aging population, a significant share of government financing, and the scope to increase in size by acquiring smaller scale operations. Investors extract shareholder value in ways that are unrelated to productivity and which generate returns even when an operation may ostensibly be lossmaking. Methods of financial extraction include hiking up company debts, setting up complex property ownership arrangements, establishing corporate ownership in tax havens, alongside exploitative working practices. The care sector is labour intensive and the mainly female workforce, has long been undervalued. Most are paid less than the Real Living Wage and many are on zero-hour contracts. This paper shows that such structures of provisioning are inequitable across different dimensions. Shareholder returns are ultimately funded by tax payers and the personal savings of individuals, for whom social care is an essential service. High returns to offshore investors sit alongside poor working conditions for frontline staff. Processes of financialisation have transformed care services from a social need into a financial investment. This translates into new social relations where narratives are constructed in terms of markets and efficiency. Meanwhile, the underlying inequalities are overlooked and become normalised.