FINANCIAL TIMES: Private equity and Britain’s care home crisis

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Peter Folkman, a former board member of the British Private Equity & Venture Capital Association who teaches at Manchester Business School, calls it the “football player problem”. He adds: “There is a lack of shame around executive pay which is writ large in care homes where many staff are on the minimum wage.” 

The payouts may not seem excessive relative to other companies. But other financially stressed and lossmaking government outsourcers have faced criticism over pay and dividends, whereas none of the care home operators are listed, protecting them from public scrutiny.

“Pay packages like this are completely inappropriate for an activity like social care, where revenue comes largely from the government,” says Mr Folkman. “There are no clear criteria for performance, it happens within complex group structures and it is just not clear who is paying how much for what.”