Social services bosses reacted angrily last night to a Government report criticising Birmingham for failing to promote independence and choice among older people.
The Commission for Social Care Inspection gave the city council's adult care services a one-star rating, but warned of an "uncertain capacity for improvement".
A year ago, the CSCI awarded adult and children's services a one-star ranking and predicted promising prospects for future improvement.
The gloomy assessment shocked social services officials, who have benefited from an additional #85 million of council funding since 2004.
Sue Anderson, the cabinet member for adults and communities, accused the CSCI of failing to take into account an ambitious #100 million plan to replace 30 unfit old people's homes with modern residential care centres.
The first of ten new centres is due to open in 2008 and the project will be finished by 2010.
The tone of the CSCI report, which criticises the council for failing to meet minimum standards of residential care, is likely to speed up the closure of the homes. Leaders of the council's Conservative-Liberal Democrat coalition are keen to attain at least a two-star rating by May 2010, when crucial city elections will be held.
Birmingham also lost marks because the standard of its management information, listing daily use of services in day centres, was not good enough.
Coun Anderson (Lib Dem Sheldon) said: "We have got the land for the special care centres, we have got the money and planning permission, we have started to build them and yet our prospects for future improvement are deemed uncertain. How on earth can this be fair?
"I am very disappointed at the tone of this report but I have confidence that we will deliver improvements.
"We will not rush the closure of old people's homes because you are talking about people's lives. But we are determined to lay the foundation for better services and press ahead with the new care centres as quickly as possible."
Peter Hay, strategic director for adults and communities, said he was "not bothered" by the CSCI's ranking on future improvement. "None of the work we have done for the future is generated in this judgment. The key for us is how well we are serving people. We have to build new forms of care and close other forms of care.
"It feels a bit painful when you get knocked back, but we will get there," he added.