The report, carried out for the organisation by community care analysts Laing & Buisson, found that care homes for people who need nursing and residential care are still being under-funded, with a big gap between council fees and the reasonable costs of running a good-quality care home.
It found that an extra £540m is still needed in the system to enable local authorities to fund a modernised care home sector.
The report estimates that fair market fees for operating a typical modern efficient care home in 2008-2009 with weekly nursing care costs £665 per person and £556 for the care of older people with dementia.
Commenting on the report Julia Unwin, director of the foundation, said: ‘The day-to-day challenges faced by the sector need to be tackled. Inevitably, this means addressing issues of funding, and ensuring that the dialogue that takes place between those commissioning services and those providing them is well informed.’
Martin Green, chief executive of the English Community Care Association, said that the report was a ‘wake-up call’ for the government nationally and locally. ‘It clearly indicates that the current levels of underfunding are significant and totally unsustainable,’ he said.