Pressure is mounting on aged care providers to show how they spend taxpayer subsidies.
Federal MPs who want transparency in aged care funding are making a renewed attempt to force providers to reveal how they spend their huge government subsidies.
Centre Alliance party MP Rebekha Sharkie has introduced legislation known as the Aged Care Legislation Amendment (Financial Transparency) Bill 2020.
It would require providers to disclose their income, their spending on food and medication, the amount spent on staff and staff training, accommodation, admin-istration, and how much they pay their parent bodies.
“This will enable families of loved ones, stakeholders and the public to have a clear view, for the first time, on the proportion of income that providers actually spend on costs of care and how much is just being pocketed or wasted,” Ms Sharkie said.
“Unlike hospitals and childcare centres, aged care facilities can employ as few staff as they like because there are no staff-to-resident ratios in nursing homes.
“We do not know how much they spend on staff, or what categories of staff they spend their money on.”
The bill mirrors legislation introduced by fellow Centre Alliance MP Stirling Griff last year.
The ALP, Greens and Centre Alliance supported this 2019 attempt to legislate for financial transparency and accountability but the Liberal and National parties, with the support of One Nation, voted to defeat it.
Senator Griff said the federal government and One Nation were heavily lobbied by some aged care providers to block that “game-changing” legislation.
“Sadly, it showed just how strong the ties that bind the aged care lobby and government really are. It was a deplorable act,” he said.
“The aged care industry has been successfully lobbying governments for years arguing against more transparency. The influence of the industry through government committees, think tanks and policies is well known and is being rightly questioned at the royal commission into aged care.”
Taxpayers’ money – without accountability
In 2018–19, governments spent over $20 billion on aged care, with about 66 per cent of this going to residential care.
Senator Griff says more funding is needed to fix aged care, but governments cannot simply pour money into the system without getting more accountability and transparency from providers.
“Currently, providers can spend their taxpayer subsidies pretty much as they choose,” he said.
“When it comes to food, a study of 800 nursing homes shows the average spend is just $6 a day.
“My office has heard firsthand accounts from people who work with and for aged care providers, highlighting that dodgy financial decisions and profiteering takes place.
“For instance, there is a hundred-bed provider that has made $2.5 million in profit three years running, but this profit is only shown as $500,000 on its financials, because they pay $2 million in rent to the parent company, which already owns the building.
“There is a 50-bed, not-for-profit facility where the salaries for three managers exceeded $500,000 at a time when the home could not meet basic minimum standards and was also sanctioned.
“Other providers have used subsidies to help send senior staff to overseas award ceremonies and lavish conferences.”
Nurse unions back transparency law
Legislation to make the aged care system more transparent is backed by the Australian Nursing and Midwifery Federation (ANMF), a national body which represents state-based nursing unions including the NSWNMA.
ANMF Federal Secretary, Annie Butler, said that when deciding on a nursing home, residents and families have the right to know what the facility spends on basic care needs.
This includes items such as food, medicines, medical products, continence aids, management wages, staff wages, and staffing numbers and categories.
“Families and residents cannot make informed decisions without knowing the composition and qualifications of the workforce and the training provided to them,” she said.
“Providers are currently able to spend taxpayer subsidies as they choose and, as the royal commission has exposed, this is not delivering in some cases even basic standards of care.
“Large for-profit aged care providers in particular are, like many businesses, using complex corporate structures and tactics to maximise earnings and profits and avoid tax while taking advantage of generous government subsidies.”
Queensland opens the books
When Earle Haven Retirement Village on the Gold Coast suddenly closed over a contract dispute in July 2019, almost 70 residents were left abandoned by management.
This led the Queensland Labor Government to legislate for a new standard of transparency for private and public health and aged care facilities.
The new law gives Queenslanders information about the aged care facility they choose, the number of staff, qualifications of staff and skills mix.
Private aged care facilities can opt out of disclosing this crucial information, because they are regulated by the federal government, but the Queensland Government can publicly disclose that a facility has chosen not to provide this level of transparency.