"Care in the Community" was, in my opinion, a rather misguided notion. Psychiatric hospitals were criticised for creating instutionalisation - and that was a valid criticism I think - but that issue could have been addressed rather than closing virtually all psychiatric facilities.
Obviously there are people with mental health issues that do not threaten the safety of other people, and, provided enough support is available, perhaps care in the community is more appropriate. However, for people who have exhibited paranoid thoughts, accompanied by threatening behaviour or actual violence, I think the old system was better.
Large psychiatric institutions ensured that when people were at crisis point they could be kept safe in hospital where their state of mind could be properly assessed and monitored, with a view to leaving hospital once their condition was regulated. Some patients were regularly admitted and then, once it was deemed safe for them, and for the general public, to be discharged, they could return to society. Sometimes this required sectioning, but often patients were admitted on a voluntary basis.
A recent thread on Mumsnet demonstrated how many people were concerned about the number of people with severe mental health and/or addiction problems that are on the streets now - people wandering around shouting aggressively at anyone and everyone, people in near catatonic states, often with observable medical issues, such as leg ulcers, etc, etc. It seems there is no real help for these people now and their mental and physical health just keeps on deteriorating - causing them and the people around them - great distress, and sometimes danger.
"Community care" could not be a cheap alternative to in patient care - quite the opposite - but, in my view, it was seen as a way of reducing costs and making land and property available for sale to developers.
