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Thursday, 29 May 1997
Page: 4031

Senator NEAL(5.19 p.m.) —I rise to put forward very strongly the view of the Australian Labor Party, that we are opposed to the imposition of entry fees for nursing homes and we believe that the methodology that is being applied by this government is inequitable and socially backward and will adversely affect those who are disadvantaged and elderly in our community—some of those who are absolutely the very worst off.

It concerns me that so many members of the coalition are happily prepared to march down this road without raising any real queries. In particular, I am somewhat startled by members of the Community Affairs Committee on the coalition side who seem not to have heard the evidence that was provided to us from both operators of aged care institutions and representative groups of the elderly such as the Combined Pensioners and Superannuants Association.

It is pretty much on the record these days what the entry fee means, although I notice that the coalition is still trying to allege that some of the higher figures suggested by us are some sort of scare tactic or are untrue. In fact, the legislation clearly states that, in determining what the entry fee for a nursing home is, the only limitation that can be placed on it is that the resident entering that home be left with the sum of $22,500. That is a figure that does not exclude the family home, as a lot of tests do, but includes it. So if you are someone who has had a fairly average income for most of your life and you become frail and have to enter a nursing home, you can be required to sell your home and provide the nursing home with all those funds, except for that small figure that I have mentioned.

When this debate first started sometime last year shortly after the budget, I suggested in this chamber that that fee could be a figure of approximately $26,000. That is a figure that we extrapolated from the entry fees that are provided in hostels. I remember being screamed down by members of the coalition, who said that that was an untrue statement and an exaggeration.

I thought Senator Knowles could have come in here with good grace apologising for those statements rather than reasserting the falsehood because of the evidence that we took in the Community Affairs References Committee. I really have not had a lot of time to look, but I had a quick flick through as I was preparing today. That radical group—that is, Mr Brotherhood, the Chief Executive Officer of the National Association of Nursing Homes and Private Hospitals; I would not think a Labor Party front—said very clearly when asked:

Have any of your affiliates indicated what their bond levels are going to be?

Mr Brotherhood —No, not at this stage.

The chair pressed the point and said:

Any ballpark figures?

Mr Brotherhood —It is probably about $50,000 at this stage. Many providers do not think they will initially receive a very high bond, nor will they ask for it.

The next question I asked was:

Was the $50,000 for the single room or for the share room?

Mr Brotherhood —That was for the single room.

We also received evidence later the same day from commentators on the legislation, people who were presently involved in the nursing home industry, that in fact the entry fees that could be requested could in some cases be as high as $90,000. So I certainly wish to say that our initial allegations, or suggestions, that the fees could be as high as $26,000 were not inaccurate in that they were too high but inaccurate in that they were too low.

I have to deal with some furphies that were raised earlier in debate—that is, the reliance of this government on the Gregory report as somehow justifying the requirement of this entry fee. I have to put very clearly on the record that the Gregory report did not suggest that there should be an entry fee, but in fact clearly stated as a recommendation that an entry fee should not be the means of raising capital. I find it somewhat surprising that this government would attempt to mislead the Senate and the community by somehow saying that it is relying on that report in pursuing this legislation.

The reality is that, despite the complaints from the coalition government about our performance in terms of capital contributions to nursing homes—and I must confess that I thought our levels of expenditure could have been higher, and certainly the nursing homes needed it—at least we spent some money, and the figures were outlined by Senator Knowles. This government is spending nil on capital contributions to nursing homes. In fact, the coalition government in 1996 cut $577 million over four years from aged care. If that is a government that gives priority to providing accommodation to those aged people, I am somewhat surprised because a cut of that magnitude over four years is not an indication in my mind of this government caring for elderly people and caring about the funding of nursing homes.

The most worrying thing about this entry fee is the fact that it creates a two-tiered system. It creates a situation for those who can pay, for those who are in the non-disadvantaged designation. They will be able to pay an entry fee and get into a nursing home that will be of an extremely high quality. For those unfortunate people who are pensioners, who do not have a capital base, who do not have a home or who have had a difficult life, they, again, will be in a difficult position under this coalition's government's policies.

I noticed that some umbrage was taken by Senator Knowles in relation to the allegation that only an additional $5 per day would be provided for capital assistance for those people who are disadvantaged. The fact is that that is exactly the case. There are the ongoing subsidies as residential fees, as were provided under our government, but, in order to redress the imbalance of the funds that can be taken from those who are well off, this government will be providing the paltry sum of $5 per day. What is this going to mean?

Let us just apply a bit of commonsense to this proposition. You are a nursing home and you can chose to allow entry to someone who provides you with the sum of $5 a day or someone who can provide you with $88,000 or maybe more. From that $88,000, you are entitled to not only take away the sum of $2,600 per year as a payment but also retain any interest that is made out of that fund that the nursing home holds. The interesting thing about that $2,600 is that it is required to be spent in providing care for elderly people in the nursing home, but on the second sum, that interest figure, there is no such restriction provided in this legislation.

The interest that you draw off the money that you obtain from the aged persons entering your home is not limited in any way. If you are a for profit aged care institution, there is nothing in this legislation that prevents you from keeping that interest in your pocket and distributing it to your owners as profit. Of course, the point that is obvious to everybody in the community is that the larger the sum that is provided as an accommodation fee, or an accommodation bond, as this coalition is trying to call it, the more interest you will be able to draw off those funds and the greater the amount of money that you can retain for your benefit. (Time expired)