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Monday, 20 May 1985
Page: 2124

Senator GILES —My question is directed to the Minister for Community Services. What are the immediate and longer term implications of the measures announced in the May statement which affect existing and prospective nursing homes? In framing these measures, has any account been taken of recommendations of the many committees of inquiry into nursing homes, particularly of the Senate select committee which reported recently on the administration and financial organisation of nursing homes in Australia?

Senator GRIMES —In developing policy on the future of the nursing homes program in Australia we, as a government, are considering all the reports that have been brought out on the matter of nursing homes, in particular the report of the Committee that was chaired by Senator Giles, the report of the House of Representatives Standing Committee on Expenditure-the McLeay report-and others. We believe that if we are to proceed down a rational path it is best to ensure that all those reports which have gone carefully into the matter are considered. The changes in the May statement will make very little difference in the short term and will be only part of the many changes that will be made in the long term to the development of the nursing homes program.

The particular change initially was the one introduced to ensure that people who have approvals for funding under the projects for homes for aged and disabled people do not hang around on the waiting list for months and sometimes even years. What we have said is that after 18 months organisations which may not have been able to commence funding will be dropped from the list unless then can show reasons why they should stay on the list. The Government cannot afford to hold a commitment such as this for an indefinite period while we have new forward programming arrangements. At the same time, we have to ensure that funds are directed to the most needy, that we improve the equity and coverage of institutions and that we also improve our capacity to provide new services. It is for those reasons that we have determined that organisations with approval in principle for in excess of 18 months will be advised that their approvals may have lapsed if their projects are not brought to the tender stage within six months. This may stimulate some organisations to move forward, but it will also mean that many of the organisations which are not going to proceed will acknowledge this.

The other main change is freezing of the nursing home benefit available in Victoria, South Australia and the Northern Territory. For some time this Government and other governments have been concerned about the disproportionately high cost of nursing home beds in Victoria and South Australia, in particular, and in the case of two nursing homes in the Northern Territory which apply the same fees. In Victoria the fees are over 70 per cent higher than in Tasmania and over 40 per cent higher than in New South Wales. This is largely due to State government regulations and provisions in this area. We do not believe that the Federal Government should be up for indefinitely increasing funds in this area when we have no say in the determination of awards or conditions in those States. I believe that the States are well aware of that and will accept it.

Similarly, we have decided not to increase the benefit levels for government nursing homes in, as usual, November. Government nursing homes equally are the responsibility of State and Federal governments. They supervise their costs and decide what fees the patients in those homes will pay. Up until now, government nursing homes have received favourable treatment compared with private nursing homes. For example, the benefits paid to private homes are subject to reductions where the minimum patient contribution and the maximum benefit would exceed the Commonwealth approved fee. However, Commonwealth homes are not subject to that reduction and, therefore, have always been paid the maximum benefit applicable.

A further measure that was taken was to increase the patient contribution to 87 1/2 per cent, which applied for many years but which was dropped to 85 per cent last October, to take into account the very steep 50 per cent jump in supplementary assistance which was provided for pensioners in rental situations. However, it was decided in the May economic statement to revert to the previous practice which had been followed by governments for many years. So these changes will not be radical as far as the planning and provision of nursing homes in the future are concerned. That will involve a much more detailed examination of the situation as it exists and much more radical changes to the system than have been decided on in the May statement.