HUNDREDS of private residential and nursing homes in the North-East are facing a double blow which could drive many out of business.

Care homes have warned that a rise in the national minimum wage combined with a squeeze on local authority grants is about to lead to a number of closures.

The Registered Nursing Home Association (RNHA) said that one nursing home every day in the region is being forced to shut, making it more difficult for the vulnerable to get care.

It said Government plans to raise the national minimum wage by 30p to £4.50 an hour are in contrast to the small increases being offered by some local authorities in the fees they pay for publicly funded patients.

A number of care home associations in the North-East have already rejected pay packages from their councils for the next financial year.

These include associations in Middlesbrough, Stockton and Darlington. Frank Ursell, chief executive of the RNHA, said: "We are appealing to the Government and local authorities to ensure that older people receive the level of priority they deserve."

Members of the Darlington Care Homes Association are to meet Darlington Council's director of social services Margaret Asquith on Monday to discuss the situation and lobby for more money.

Jeremy Walford, managing director of the Middleton Hall residential nursing home in Middleton St George, near Darlington, said a proposed five per cent or £14 a week increase in fees paid for residential and nursing care patients was "not acceptable".

Mr Walford said an independent financial study carried out by accountants KPMG on behalf of umbrella organisation Care North-East showed that fees realistically needed to rise more than 20 per cent to get many homes back on a sound financial footing.