A SCOTTISH family care firm has gone bust due to budget cuts and UK Government purges of foreign workers.
Administrators were appointed to Carers Direct Ltd last Tuesday evening following the final day of operations on Monday, the Helensburgh Advertiser first reported.
The firm, based in James Street in Helensburgh, had been running for more than 20 years and 35 people have been made redundant.
Carers Direct had more than 100 care packages in Helensburgh, Inveraray, Campbeltown, and Oban. Some might be one 15-minute visit a day, others added up to 25-28 hours a week of support for residents to be at home.
Argyll and Bute Health and Social Care Partnership (HSCP) confirmed it had been involved since the middle of May in ensuring care continues.
A now former member of staff, who asked not to be named, told the Advertiser that budget pressures with the HSCP led to reduced hours. That meant three care staff earned below a threshold set by the Home Office.
Last year the Home Office cracked down on visas for overseas care workers.
It revoked the licence for Carers Direct to sponsor international staff, impacting 16 care staff. There were a total of 26 care staff.
Despite an appeal given the particular challenges across Argyll and Bute, the Home Office revoked the licence.
Care staff began to leave in search of other employment, and as more care packages had to be handed back, Carers Direct could no longer sustain itself, explained the former worker.
They say one member of staff was under the earning threshold because of cuts to Argyll and Bute and the rationing of care packages.
"The Home Office decision was the catalyst that started the collapse," said the former worker.
"Staff were told insolvency was likely a couple of weeks ago. June 1 was the last working day.
"The company lost the sponsorship licence, which meant all of our [sponsorship] staff were going to be given 60 days to find a job or leave the country.
"We had to hand back a lot of the 100 packages in the last three or four weeks. There were closer to 70 by the end."
Many care packages will have to be picked up by HSCP, which will have to employ more agency staff, further stretching its budgets, explained the ex-employee.
It is unknown what the cost to taxpayers will be from the Home Office decision.
The UK Home Office spokesperson said: “Overseas recruitment for care workers closed in July 2025 after unacceptable levels of exploitation left large numbers without the hours or pay they were promised by their sponsors.
“We make no apology for getting migration under control, and under this government net migration is down by 82 per cent.”
The department has taken action against more than 1400 care providers since the last government opened a route for foreign care workers.
A spokesperson for the HSCP said: "Argyll and Bute HSCP is aware of the decision by Carers Direct to cease trading from June 1.
"We recognise this news may be concerning for people who receive care at home support, their families, carers and staff.
"Our immediate priority is the wellbeing of service users. We are continuing to work closely with our partners to put continuity arrangements in place.
"All people receiving care were initially contacted by letter by the HSCP and advised of alternative arrangements, including transfer to new providers, in-house care at home teams or agency-supported services, as appropriate.
"Service users and staff were formally informed of the position on May 13, 2026, and we will continue to provide updates and direct communication to those affected as transition arrangements progress.
"A short-life working group, involving social work managers from across Argyll and Bute, is overseeing the transition and ensuring care packages are reviewed to support consistency and continuity of care.
"We appreciate that this may be an unsettling time and would like to reassure people that the HSCP is closely overseeing the situation and working at pace to maintain continuity and quality of care throughout this period of transition."
Carers Direct described its services as including personal care, mobility, meals and feeding, toileting, in and out of bed, respite care, bathing and many others.
The website states its vision was "providing outstanding personal care and support".
The Care Inspectorate's latest report, in November, rated the firm "good" for supporting wellbeing and care and support planning, and "very good" for its staff team.
Kenneth Craig and Simon Smith of BTG were appointed joint liquidators of the business on June 2.
BTG’s managing partner in Scotland, Thomas McKay, said: "Shrinking margins, the high logistical costs associated with serving clients across a wide geographical area, and ongoing staffing challenges have ultimately led to the company's failure and, regrettably, all 35 employees of Carers Direct have been made redundant.
"Ensuring that clients, many of whom are elderly or infirm, continued to receive the care they needed was our immediate priority. We have worked closely with local council care teams to ensure that those receiving care from Carers Direct were not adversely affected by the company's closure.”
Support is being offered to former employees to access their entitlements.
McKay added: “The care sector continues to face significant challenges, including rising fuel costs, increasing wage pressures and wider operating cost increases.
"These factors are making it increasingly difficult for some care businesses to operate profitably and, as this is the second care business BTG has been appointed to in a matter of weeks, the likelihood of further insolvencies across the sector remain a concern."
