As town halls up and down the country feel the pressures of spending constraints, one sector of the economy has been particularly hard hit.

The care industry, which looks after the nation’s elderly and infirm, has already begun to notice a tightening in the criteria for access to services as local authorities attempt to cut costs.

Councils are responsible for providing care to all those who live in their areas, and with local government budgets tightening, companies which operate the care homes say that a long-running trend for councils to raise the eligibility criteria for older people has picked up in pace in recent months.

As a result, people who would have received care services – whether in their own home or in a residential setting – at lower levels of dependency, are now only receiving them when their needs are more acute.

“There’s been a trend over a number of years that the dependency level [of new residents] has increased but it is particularly noticeable this year,” said Pete Calveley, chief executive of Four Seasons Healthcare, which operates 400 homes and cares for 15,000 people.

Mike Parish, chief executive of Care UK, which specialises in acute dementia care and ‘domiciliary care’ given to people in their own homes agrees.

“In community care, they grade the level of dependency and they’ve got four rankings,” he said.

“If you look back five years ago, about half of our services in community care [care given to people in their own homes] would be level 1, the highest level of dependency. Now it’s about 80 per cent, with hardly anyone in levels 3 and 4.”

Part of the problem is that there are, as yet, no national standards for when somebody must receive access to care.

“You could find for example that in North Yorkshire somebody who’s got low dependency doesn’t get any domiciliary care, but someone else in say London or East Anglia or somewhere else does,” said Jamie Buchan, chief executive of Southern Cross, the UK’s largest care home group with 37,000 beds and 730 homes.

“There’s a real postcode lottery at work here and has been for some time.”

Andrew Cozens, group strategic lead for adult social care at the Local Government Association, said that about 70 per cent of councils have now set their criteria for access to care at either ‘critical’ or ‘substantial’, the two highest levels of care need.

“It’s a crisis that everybody recognises,” said Mr Cozens.

The green paper on social care, released in July, floated the idea of a national insurance system for care, but there is little chance of any concrete policy initiative until 2014.

In the meantime, tight budgets are likely to affect the provision of care. The result is that dementia specialists and providers of acute care will continue to receive local authority custom. However, unless they can appeal to the more demanding private pay sector, care businesses that focus on people with only moderate needs are likely to struggle.

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