The Adult Care Services Cabinet Panel of Hertfordshire Council met on Wednesday, 3 June 2026, to discuss the development of nursing home provision in the county. The panel endorsed a new social investment model to increase the availability of nursing care beds, which will be funded by institutional investors and developed by external partners.

Development of Nursing Home Provision in Hertfordshire

Hertfordshire County Council is facing a growing demand for nursing care, driven by an ageing population and an increase in complex needs, particularly dementia. It is projected that there will be a shortfall of approximately 839 nursing beds, leading to an £18 million annual cost pressure by 2032. To address this, the council has endorsed a social investment model (SIM) as its preferred approach to developing new nursing home capacity.

Under the SIM, institutional investors will fund and develop new nursing homes. Hertfordshire County Council will then enter into long-term lease arrangements for these properties and sub-lease them to care operators. This model aims to attract socially focused investment, reduce the need for upfront public capital, and allow the council to retain strategic oversight of quality and affordability.

The proposed programme aims to deliver between six and eight new nursing homes, creating around 600 additional beds. Of these, 150 to 200 beds will be secured as affordable capacity for council-supported residents. The first homes are expected to open from 2028.

During the discussion, Councillor Tony Kingsbury asked why the model was changing from previous delivery methods and why the new approach was expected to be faster. Josh Dunn, a director at Newton, explained that borrowing costs for the council had increased significantly, necessitating a new model. He added that the SIM incentivises investors and developers to complete projects quickly due to the nature of their capital deployment.

Councillor Rachel Carter raised concerns about the shortfall figures, clarifying that the 839 beds represent affordable beds that the council would need to fund. She also inquired about the design and specification of the new homes and whether the council would retain ownership. Christian Tissard, Head of Commissioning for Older People, confirmed that the shortfall relates to affordable beds and that the council would have a strong influence on the design process, ensuring homes are attractive to both self-funders and council-supported residents.

Councillor Chris Lloyd highlighted concerns about the timescale for planning and development, the ownership of land, and whether other councils were using a similar model. He also stressed the importance of public health initiatives to encourage healthier lifestyles and reduce future demand for care services. Josh Dunn explained that investors and developers would hold the planning risk, and that while planning can take time, long-stop dates would be included. He also noted that while Hertfordshire had a history of building care homes, the SIM model, particularly involving pension capital, was newer but had been successfully used by some councils, notably in Scotland.

Councillor Nigel Bell welcomed the SIM model and expressed confidence that the council would secure the right homes in the right places. Councillor Paul Seeby questioned the market's ability to deliver dementia-specific care and step-down facilities. Christian Tissard assured the panel that the market could deliver homes with the right specifications and that commissioned homes would be capable of providing step-down care.

Councillor Wendy Rouse raised concerns about potential issues similar to those experienced with Private Finance Initiative (PFI) schemes, particularly regarding maintenance. Josh Dunn explained that the SIM model was designed to avoid these pitfalls by having straightforward lease agreements with fixed annual payments adjusted only for inflation, and that maintenance and operating costs would be detached from the council's liability.

Councillor Lesley Greensmith, new to the panel, expressed support for public health initiatives and questioned the size of the proposed homes, particularly for residents with dementia. Officers clarified that individual homes would typically be around 75-80 beds, considered optimal for quality and management, and that the 150-200 figure represented the total number of affordable beds to be delivered across the programme.

Councillor Calvin Horner noted the opportunity presented by pension reforms for investing in such infrastructure and asked for clarification on how the number of proposed beds was reached. It was explained that the number was based on manageable capacity and the desire to address a significant portion of the demand without overcommitting.

Councillor Stuart Roberts, who had previously reviewed the paper at the Resources Panel, expressed continued enthusiasm for the project. He raised questions about the council's resource capacity to manage the project timelines and the quality of care staff. Officers confirmed that resources were in place, though acknowledged the challenge of balancing this with work related to Local Government Reform (LGR). They also detailed plans to ensure providers recruit and train quality staff, with clear expectations set in specifications and a focus on values-based recruitment and training.

Following a detailed discussion, the panel moved to Part Two of the meeting to discuss financial and site-specific details. Upon returning to Part One, the panel formally recommended to Cabinet that it:

• Agrees the social investment model as the preferred option for delivering additional nursing capacity.
• Approves the progression of the social investment model to implementation, including identifying investors and developers, and entering into necessary contractual and lease arrangements.
• Delegates authority to the Executive Director of Resources, in consultation with relevant Executive Members, to enter into these contractual and lease arrangements.
• Approves the inclusion of the Hitchin Road, Stevenage scheme within this approach.
• Notes the need to secure external resources for specialist legal, financial, and technical advice.

The next meeting of the Adult Care Services Cabinet Panel was scheduled for Thursday, 2 July 2026.