Chelsea Care ‘doomed to failure’
A home care provider run by Kensington and Chelsea Council has been put into liquidation, costing taxpayers nearly £300,000.
Chelsea Care was set up in 2008 to offer care for those who most needed assistance at home, following a decision by the cabinet at Kensington and Chelsea Council.
They invested an initial £150,000 equity while it established a private client base.
Officials had calculated that although the company would record a loss in its first financial year, they expected it to make a profit of more than £100,000 by the end of March 2012.
However by the end of March this year, Chelsea Care had recorded a loss of more than £287,000, and a meeting of the cabinet and corporate services scrutiny committee on Monday (17) was given a report into just what went wrong.
The report, presented to the committee, said: “In hindsight, the venture was doomed to failure, from a commercial perspective, from the start.
“It was a plausible notion, albeit rather optimistic, but the absence of a clear business plan covering how the company would grow its private business meant that it never achieved ‘escape velocity.’
“The committee felt that insufficient vetting of the business plan at the start had been a fundamental mistake.”
Chelsea Care was put into liquidation, with Cork Gully LLP appointed to dispose of the firm.
However, staff in the adult social care department at the council worked to make sure that Chelsea Care could continue to provide support and care services to clients until they could find alternative arrangements.
And the council report said: “No client has suffered a break in care or a fall in the standard of his or her care as a result of the closure of Chelsea Care.
“No significant complaints have been made in relation to the transfer of care.”
But some residents feel that the council should never have used taxpayers money in a business ‘doomed to failure.’
Audrey Hammond, 47, who needs home care after a road accident left her with serious back injuries, and only able to walk a short distance, said: “I understand the need for home care, obvioiusly, as I use it a lot.
“But to set up a business, without a proper business plan and without experienced people to run it just seems ridiculous.
“We need care providers, but wasting taxpayers money on silly ventures that haven’t been properly planned is just so silly. The council mst have far too much money.”
Councillors at the meeting on Monday noted the contents of the report, and urged caution over future financial dealings.