Where does the £1,465 a week we spend on a care home place go?

The debate around the UK's social care system often includes opinions on how costly care home places can be and where residents' fees are going.

As part of the BBC's special focus on the sector, we have broken down the cost of a week's residential nursing care, and looked at some of the key outgoings for providers.

Healthcare data provider LaingBuisson suggested the average weekly fee for a "frail older person" was £1,465.

The firm has based its analysis on the model of an "efficient" large care home, which is run for profit with more than 50 beds.

Mike Padgham runs a group of care homes in North Yorkshire and chairs the Independent Care Group, which is an organisation that supports care providers in North and South Yorkshire.

He said care costs varied but staffing was always the biggest expenditure, taking up about two thirds of the fee income.

Of the £1,465 a week, in LaingBuisson's figures, £914 goes on staff wages, which includes domestic and catering staff, plus agency workers.

"A massive part of the cost of a week's care goes on keeping the care home running and paying the staff," Padgham said.

"We want to pay them better, but it involves some compromises further on if we're going to do that.

"In many care homes, staff are paid above the minimum wage, and I think that's the right way to go."

Padgham said he believed privately-employed care workers should be paid "on a par" with NHS employees who do a similar job.

But he said the "sums don't add up" for independent care homes, as they provide care for clients referred by local authorities, who, Padgham claimed, don't pay private providers "anywhere near what the true cost of care is".

"The private payers are subsidising the state to make things work," Padgham said.

Michael Harrison, North Yorkshire Council's Conservative member for health and adult services, said the authority paid for "an awful lot" of care places in private homes.

"They are a vital part of the sector," Harrison said.

"A lot of the money the council spends goes on buying a service from that independent sector. Some people pay for their own care needs, but for a lot of people the council has to fund it.

"We absolutely need the independent sector to thrive and be sustainable. A lot of the money we spend is on buying care from the external market, and there is no one price across North Yorkshire.

"We try as a council to be fair, to make sure we are prepared to pay a rate that is sustainable for the external care market, while at the same time needing to make sure we get good value for money."

Padgham said volatile energy prices meant that utility bills – particularly the cost of gas and electricity – were taking up an increasing chunk of the cost of care.

Care homes were energy-intensive, he said, with vulnerable people needing to be kept warm and a lot of laundry needing to be washed at high temperatures.

"The situation is so fast-moving, and because of international events one of the biggest things recently has been the cost of utilities," he said.

"It's not a question of, 'let's turn the heating off for a few days to save money'."

LaingBuisson's figures said £36 per resident each week went on gas, electricity, water, telephone and internet.

There is also maintenance and refurbishment of the buildings and the cost of outings, entertainment and activities for the residents.

"The standards the Care Quality Commission expect go up and up," said Padgham.

"We've got to satisfy them [as well as] the local authority and the NHS in their inspections."

LaingBuisson estimated that repairs and maintenance accounts for £41 from the weekly bill.

Hiring staff to provide cover for employees who are on training courses costs about £14 of the £1,465 weekly bill.

Padgham said the changing nature of healthcare, with people going into care homes with increasingly complex needs, meant staff training needed to be updated regularly.

"Nowadays the type of client we're looking after is much more dependent than they ever used to be, and they need much more attention," he said.

"We want to keep them occupied, and it does take up a lot of time and resources."

Padgham said the profit margin for his business was between 3% and 5%, and LaingBuisson calculated the average figure at about 7%, which works out at £106 per week.

"There are big corporate providers and smaller family providers. The smaller providers are perhaps just earning a reasonable living, not vast profits," he said.

"The public tends to think it's a licence to print money, and it may have been 40 to 50 years ago, but not now. Today it's about earning a living."

LaingBuisson founder William Laing said: "That £106 figure represents the return on the investment in the property, and the operating investment, which is the cost of the care, catering, and all the other services a care home provides."

The list of other costs at LaingBuisson's "pro forma" sample of a care home is extensive.

It includes £54 a week on domestic and cleaning costs, £33 on council tax and rates, £7 on the disposal of trade and clinical waste and £8 on medical supplies and personal protective equipment (PPE)

Head office costs are put at £86, £3 of the week's fee goes on office supplies, £9 is spent on insurance, and £12 on "other costs".

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