FEES for residential homes in the borough came under fire when Marco Forgione, Conservative community campaign leader, called for the Office of Fair Trading to investigate council funding.

An OFT study is under way to examine the accessibility of information about fees and extra charges and how well protected residents are against excessive price increases.

Mr Forgione requests that the office extends the scope of its study into the transparency of residential home fees and the issue of local authority allocation for Richmond's elderly residents.

He said: "While I welcome the steps that the OFT are taking to reduce the ambiguities surrounding residential home fees, I am disappointed that its remit does not extend further into the issue of local authority funding.

"The current situation whereby most local authorities are failing to meet the full market rate for care costs, leaving many relatives of residents to meet the costs, is unacceptable.

"In Richmond there are just 870 residential home places. Closures create further upsets for the elderly residents - indeed there is a proven link between reduced life expectancy and change of residential home.

"The OFT needs to launch a fundamental review of local authority funding as the only means by which the elderly will be able to get the standard of care they deserve in the future."

The OFT plans to launch a market study in the near future in response to an informal complaint by the Consumers' Association. The study will examine: l The context in which older people and their relatives make choices about a care home and how this affects competition in the market.

l The ease with which prospective residents and their representatives can obtain sufficient clear and accurate information on fees and extra charges.

l Whether contracts offer sufficient transparency and protection against unreasonable price increases.

A spokesperson for the OFT said: "We have held meetings with interested parties and have encountered concerns over government funding, but that is really the place for the funding departments to look at.

"That is why we are not looking at it. Local authorities have a statutory obligation to provide homes to those who need them."