NEARLY 450 vulnerable and elderly people in East Lancashire face an anxious wait after a national care home firm announced plans to tackle its financial troubles.

Southern Cross, the UK’s biggest care home company, sold the buildings which housed its care homes, renting them back from landlords under long-term leases, which included an annual rent increase of about 2.5 per cent.

The company, which runs 750 homes including 9 in East Lancashire, said it would pay almost a third less to its landlords over the next four months.

The firm, which recorded a £311million loss in the six months up to March 31, hopes to win support from enough of its landlords to prevent a mass closure.

But the business may yet go bust, as they could refuse to co-operate and seize back the homes.

The Government gave a guarantee that Southern Cross residents, of which there are up to 439 in East Lancashire, would not ‘lose out’ as the firm tried to secure its future.

The company has homes in Blackburn, Longridge, Darwen, Brierfield, Haslingden, Rawtenstall, Clayton-le-Moors, Nelson and Hapton.

Blackburn with Darwen Council’s deputy leader, Coun Andy Kay, said: “I'm sure the issues surrounding Southern Cross are of great concern to residents.

"This must be a stressful time for them and their families.

“The council is committed to doing everything in its power to ensure we have planned for whatever may happen and the welfare of our residents is our top priority.”

Vanessa Hollings, director of commissioning at the Care Trust Plus, said: “The council and Care Trust Plus have a robust procedure in place to minimise any impact on residents in the event of care home closures.

“This will be put into action without delay if it becomes necessary.”

Ann Mylie, Lancashire County Council's head of quality and contracting for social care, said it had asked Southern Cross to keep it informed of developments.

Southern Cross's difficulties stem from the financial structure which has become unsustainable in the economic climate.

When Government cuts resulted in declining local authority admissions and a squeeze on fees, the annual rental bill of £230million became unmanageable.

Southern Cross chairman Christopher Fisher said: “We believe that all of the key stakeholders in Southern Cross want this restructuring to succeed.”