A new report commissioned by the ANMF highlights the lack of transparency and accountability for public funding for the aged care sector.

 More scrutiny is required of public funding in the aged care sector before there is any increase in funding, according to a new report by the Centre for International Corporate Tax Accountability and Research (CICTAR).

“Measures must be put in place to ensure that money is directly spent on improving staffing levels and the quality of care,” it says.

Australia’s six largest family-owned aged care providers receive over $711 million in annual federal funding – $60,000 per year per resident – and operate 130 facilities, with almost 12,000 beds.

The report finds these family-owned companies have ‘complex corporate structures, intertwined with trusts, that appear specifically designed to avoid tax’.

They are, the report concludes, ‘clear examples of why simple reforms are needed to restore public integrity in both aged care and the broader tax system’.

ANMF Federal Secretary, Annie Butler said: “This report shows why aged care providers must be made accountable for the millions of dollars they receive in government subsidies, particularly those such as the companies highlighted in this report, making significant profits.

“The fundamental question is whether care is being compromised for the sake of increasing profits. The stories being told currently to the royal commission and the stories we have heard from thousands of aged care workers suggest that it is. But without any accountability for the use of taxpayers’ money in aged care it’s almost impossible to tell.”

The report points out that there are large, family-owned aged care companies, such as Thompson Health Care, that “can operate transparently, pay a fair share of taxes and still make significant profits”.

Others, however, such as Tricare, one of the largest residential aged care providers in Queensland, operate in a more opaque way. Tricare is owned through Norfolk Island, which was a tax haven and overseas territory of Australia until 2016.

“Pre-existing Norfolk Island companies may continue to be exempt from capital gains tax, which may partially explain the use of at least three unlisted public companies and a dazzling array of related party transactions,” says the report.

Key recommendations from the Report 

• All entities receiving over $10 million in annual federal funding, must file full and complete financial statements with ASIC, with no exceptions;
• Immediate formation of a public register of ownership, including trusts;
• A minimum tax of 30 per cent on distributions from discretionary trusts and an examination of further trust reforms to bring Australia in line with global standards.

New aged care minister needs to hit the ground running

The ANMF has welcomed Senator Richard Colbeck into the crucial role of federal Minister for Aged Care and has urged him not to wait until the Royal Commission is over to start fixing the crisis in aged care.

Federal Secretary Annie Butler says unless the Minister addresses chronic understaffing as a matter of urgency, older Australians will continue to suffer in nursing homes.

“The new Minister cannot ignore the feedback about understaffing from our members working in aged care, or the residents and their families who have already provided their harrowing stories of abuse and neglect to the Royal Commission. He must act now.”