A Plymouth care home which collapsed into liquidation blaming the Covid pandemic and staff shortages for forcing its closure has left debts of more than half a million pounds - most of it owed to former staff.
The Oasis Care Home, in Plymstock, shut in January 2022 and now documents filed at Companies House reveal creditors are claiming £604,997 in unpaid debts. But it is estimated by insolvency practitioners that, with only about £20,000 in recoverable assets, £587,848 will remain outstanding.
The vast majority of this debt - £363,481 - is owed to 37 former workers, representing £123,718 in unpaid wages and holiday pay, and £219,013 in redundancy payments, claims for notice pay, and other wage claims.
The other major creditor is Lloyds Bank Plc, which is owed £230,000 for a mortgage taken out in 2017 and secured on the company’s freehold and leasehold property.
An online meeting of creditors took place in February and it was decided to voluntarily wind up The Oasis Care Home Ltd. Voluntary liquidator Simon Hicks, of Plymouth-based insolvency practitioner Brailey Hicks, was appointed on March 1.
A statement of affairs, lodged at Companies House, reveals it is only expected that assets of £20,750, comprising cash in the bank and the value of fixtures and fittings, will be collected in.
There is no guarantee an intercompany loan of £207,588 made to Ngauruhoe8 Ltd, another business run by the Oasis directors Steven Shirley and Tui Eliza Shirley, will be recovered.
Oasis’ bosses blamed "intolerable pressures" caused by the coronavirus pandemic, and a lack of staff, for the firm’s demise, stressing they had “no option” but to close.
The independent care home had 32 single bedrooms or suites. Prices advertised by the company ranged from £675 per week to £995 per week depending on care requirements.
Directors said it had become “impossible to recruit or retain sufficient staff" to provide the correct standard of care. Financial and operational challenges facing the care sector were also given as reasons why the care home could not continue. Oasis directors have stressed they did "everything we possibly could to continue running the home", but it was not possible to do so.
A statement on social media said: “It was with the heaviest of hearts the directors informed employees first, followed by the people who live at The Oasis and their loved ones as well as the relevant local authorities, all of which took place on January 4, 2022, with employees being the first to be informed.”
A spokesperson for the care home explained that before Christmas 2021 the directors consulted accountants and a firm of independent insolvency experts, but decided to continue operating throughout the Christmas period.
Directors stressed that “all avenues were explored to continue or sell the home, but it is recognised that the future of thousands of independent care homes are in jeopardy as a result of the many years of Government policy affecting the care sector both as service providers as well as employers”.
A statement said: "The directors of The Oasis Care Home Ltd have placed the needs of residents and staff above their own for many years, until it was impossible to continue to do that."
Unaudited financial statements filed at Companies House revealed that in the year to the end of October 2020 the company had retained earnings, a form of profit after share dividends are paid, of £85,483. This was a huge jump from the £2,861 in retained earnings recorded in 2019.
Directors said the closure decision had been “discussed in recent years”, as the organisation had struggled “like all small independent care homes”, with increasing regulation and bureaucracy compounded by the pandemic and a national staffing crisis affecting Health and Social Care services. A statement said the owners have placed the needs of the staff and residents first “to the detriment of their own health and personal circumstances”.
