Grey gold — The billion Euro business of elder care

“You could see what was coming… and it was like your worst nightmare. Because you felt like, oh my God. I have never seen anything like this before.”

Eileen Chubb, whistleblower and founder of the UK-based charity, Compassion in Care. She describes her horror at witnessing how Europe’s care homes were ravaged by Covid-19.

“I’m responsible for 400 care homes, alone with my secretary, which means I’d have to check two a day during one year, and I’m also responsible for checking the new facilities that are opening.”

Giuseppe Greco, Chairman of the Turin Local Health Authority Supervisory Commission

“I don’t think the elderly deserve to be treated like that. Nobody deserves that. I was broken by what I saw there and what I found lacking there. And then, the following year, it was the same again. And nobody care. No one cared.”

Former German care home inspector. Anonymous.

An ageing society, along with reliable public funding, forms the basis of a new dazzling business for investors. In Spain, more than 80 per cent of all care facilities are already in the hands of for-profit companies. In Great Britain, the figure is 76 per cent, and in Germany, four out of ten care homes are operated by for-profit providers. In the past four years alone, the 25 leading companies increased their capacity by 22 per cent. The share price of European market leader Orpea has doubled since 2015. Korian, which follows at number two, has just announced new purchases of facilities in Italy and the UK. DomusVi, Europe’s third-biggest for-profit provider in elder care, is based in France. But it is owned by a structure with not less than 11 intermediary owners in places like Luxembourg or the island of Jersey, for “financial engineering”. 

Investigate Europe’s team of journalists and its research partners investigated this issue in 15 countries, from Portugal to Sweden, and encountered worrying developments:

  • A steadily growing share of the money that governments are spending on care is flowing into the coffers of transnational corporations. This market has huge potential, with €220 billion of public funds paid each year to all care operators, according to OECD data. 
  • For-profit companies are running an important part of the social infrastructure. The 25 largest corporations in Europe already manage homes for more than 455,000 people in need. Their capacity grew by 22 per cent in four years, according to IE research based on numbers from the commercial data provider,
  • Some corporations actively hinder their workers from forming unions and fighting for better working conditions. Caregivers who attempt to do so have to reckon with serious consequences.
  • Financial investors are also entering the care market on a large scale. Investigate Europe has identified 30 private equity funds active in the market. These anonymous investors often avoid taxation on their profits that have been made with public money. They do this by shifting their proceeds to offshore centres.
  • Increasing privatisation in many EU countries is accompanied by cuts in staff and deficiencies in the quality of care. Governments are allowing this to go unchecked and are failing to enforce minimum care standards in many places.
  • In many of the investigated countries, quality checks and inspections are done very rarely, or are based on paperwork only.

How much do governments spend on elder care?

Calculated as a percentage of GDP

How does this profit-making business fit within a sector that is understaffed and under-financed? Why do governments allow this to happen? What are the consequences? And, are there alternatives to this cashing-in on an ageing society?

Read more of the findings with our media partners and on our website. This is an ongoing investigation which we will be updating regularly.