Feb 10, 2020

Government blocked laws forcing aged care providers to reveal food, staff spending


The federal government has blocked an amendment to new laws that could have forced aged care providers to reveal how much they spend on food and staff and how much of their funding goes to parent organisations.

Senator Stirling Griff, of the Centre Alliance party, moved the amendment that would have required residential aged care providers to provide financial statements to the Aged Care Quality and Safety Commissioner that would have then been available to the public.

The amendment would have required aged care providers to disclose their income, how much they spend on food, medication, staff, staff training, accommodation, and administration.

It would also have required aged care providers, which receive around $20 billion in government funding every year, to reveal how much they pay to their parent companies. 

Royal Commission says system should be more “open”

The amendments were knocked back in early December last year, only five weeks after the Royal Commission into Aged Care Quality and Safety handed down its Interim Report, which labelled the industry “cruel and harmful” and said a “fundamental overhaul” was required.

The report also lambasted a system that receives 80 per cent of its funding from the government but behaves like a private organisation.

“Australian taxpayers have every right to expect that a sector so heavily funded by them should be open and fully accountable to the public and seen as a ‘service’ to them,” the report states.

Amendments may have revealed “pocketed” funds

The Labor party and Senator Jackie Lambie supported the bill, but Pauline Hanson’s One Nation sided with the government and the amendment was not passed.

A statement from the Centre Alliance party said the amendment would have allowed anybody who is interested to see how much income providers spend on providing care, and how much is “pocketed or wasted”.

Senator Griff said it was “shameless” of One Nation to support the amendment. 

“It claims to stand up for ordinary people but apparently this doesn’t extend to vulnerable elderly in residential aged care who are suffering neglect and abuse,” he said.

Changes must be “feasible”

The benefit to the public of having a more transparent and accountable system should outweigh concerns about any added administrative burden, Senator Griff said. 

“Providers might object to the administrative ‘burden’ of having to provide annual financial statements but, frankly, that is a paltry concern when weighed against the vast public benefits this transparency would have finally provided,” he said.

But the Aged Care Guild’s Executive Director of Guild Operations, Nicholas Brown, told HelloCare the Guild “supports greater transparency” in aged care, but any changes must be “feasible”. 

“It is our recommendation that government continues working directly with both providers and consumers to ensure any proposed changes are feasible and fit for purpose,” Mr Brown said.

“Every minute directed to administration is a minute that could be spent on care,” he said. 

“We acknowledge everyone has a role to play, which is why the Aged Care Guild has partnered to develop proactive systems and tools to support aged care providers lead the way in driving consumer choice, transparency and continuous improvement in aged care. The Happy Life Index is a first-of-its-kind benchmarking tool that will measure and report on key quality of life indicators.”

Amendments added at the last minute

LASA CEO, Sean Rooney, told HelloCare the amendments that were proposed were added to largely unrelated legislation at the last minute.

He said publishing staff details was not enough on its own.

“LASA supports making information on staffing available if it can be adjusted for differences in resident need and is published alongside similarly adjusted measures of outcomes, particularly in relation to quality of life,” Mr Rooney said.

He said LASA would like to see more data available that would allow consumers greater ability to measure the aged care system’s performance.

He said it was “not clear” how useful disclosing such detailed financial information would be.

A spokesperson from the office of the Minister for Aged Care, Richard Colbeck, said the changes should be considered in the context of the Royal Commission and existing reforms, such the new RUCS funding model and the Prudential Standards Review.

On releasing information about staffing levels, the spokesperson said, “The relationship between staffing in aged care homes and the quality of the care provided is complex” and staffing needs can be diverse.

Despite the widely acknowledged view there is a broad problem in Australia with staffing numbers and qualifications, the spokesperson said, “The Standards require approved providers of residential aged care to ensure they have a workforce that is sufficient, skilled and qualified to provide safe, respectful and quality care.”

“Providers free to spend public funds how they choose”

A statement at the time from Annie Butler, Federal Secretary of the Australian Nursing and Midwifery Federation, said rejection of the amendment was “disappointing” because there are currently no requirements for aged care providers to reveal how they spend their government funding. 

“With no current laws in place, (aged care providers) aren’t obliged to disclose how this money is spent and whether in fact, it’s being used for the care of elderly residents. 

“Providers are currently free to spend public funds however they choose,” she said.

“Over the years, governments have injected additional funding into the aged care sector, some of which was designed to improve wages for nurses and care-workers but with no guarantees attached or requirements to demonstrate its use, it has failed to make a difference to the wages of aged care staff,” Ms Butler said. 

Staff’s capacity to provide quality care has been diminished, she said.

“This Amendment to the Bill would have, at long last, required providers to be transparent and accountable for the public funds they receive and reveal how much they direct to actual care provision.” 

Image: Grinvalds, iStock. Stock image.

This article was edited on 11 February to include comments from a spokesperson for the Minister for Aged Care, Richard Colbeck.

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  1. I cannot believe this was blocked. Yes it would create administration hours to prepare, but one would assume aged care providers would already have this financial reconciliation in place as best business practice.

  2. It’s a difficult one. I agree (strongly) aged care facilities must be made to show expenditure staffing ratios etc, but this should not be thrown out to the public media pack that will pick out the facts that support their agenda and not allow due diligence/ investigative constructive analysis. This is what is wrong with all issues effecting Australia at the present, no constructive debate, just rabble rousing helping no one

    1. The media have a responsibility to forward issues to the taxpayers of the country in the way if information. Keeping the issue hidden so no one knows and information is kept away from the public, how can you debate something you don’y know exists? There is far too much secrecy and unaccountability with this government and this is just another example. Our elderly deserve better.

  3. In Canada, there is an option for the Auditor General of each province to review in depth, publicly funded care facilities, and make comments and queries about unexplained deviations to general accounting rules, and to require response from those who ultimately manage the funding provided by the province which comes from the Federal Government’s health care transfer funds, as well as from the Minister of Health.
    Being unfamiliar at the moment with Australia’s long term care (aged care) system, there seems to be a trend towards the general public not supporting or believing that care facilities would squander money on anything but that which increases the quality of life for those residents. On the other hand there are those of us who have “lived” experience with long term care who know that not everything is right in the field of seniors care and want to change this.
    I hope there is another mechanism that forces the disclosure of normal accounting and managerial practices and that the public forces this disclosure, after they all are voters.

  4. Amother example of the totally incompetent management of Aged Care by a Government that is unable to understand that public money should be spent in a way that is transparent and accountable.

    Of course the Aged Care lobbyists find a reason why its not “feasible” to be transparent.

    The only way to stop the profitable and cruel “storage of old people” is complete tranparency.

    Unfortunately the current Government, aided by an incompetent Aged Care regulator, is incapable of understanding that Aged Care is about people.


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