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Wednesday, 23 October 2002
Page: 5711


Senator MARK BISHOP (1:47 PM) —I rise today in this debate on matters of public interest to draw the Senate's attention to a further erosion of services to veterans and war widows which has been caused by the Howard government's dramatic reduction of home care services under the Veterans' Home Care scheme. The Veterans' Home Care scheme was initiated by the Howard government in the 2000-01 budget in the usual triumphant way, with fanfares and press releases to the veteran community extolling its generosity and expressing all the usual mock concern about the needs of veterans and war widows in growing older—in the same way it trumpets every indexation increase to pensions, which are automatic, and every other dollar spent, as if good government were measured in monetary terms alone.

As the Senate knows, prior to this program, veterans and war widows requiring assistance to stay in their homes, rather than enter residential care, in general availed themselves of the Home and Community Care, HACC, program, which is jointly funded by the federal government and the states and administered on the Commonwealth's behalf by the Department of Health and Ageing. Additionally, veterans and widows can receive personal care from community nurses contracted by the Department of Veterans' Affairs and avail themselves of the Home Maintenance Helpline, whereby for a commercial fee veterans can get maintenance tasks undertaken by accredited tradesmen.

As we know, the point of all these programs is that the longer ageing people can be kept in their own homes the longer they can avoid institutional care—which is so much more expensive—and can retain the quality of life which comes from living in their own surroundings. The home care program offered no more to veterans except the convenience of having these services all delivered through one agency, namely the Department of Veterans' Affairs. In brief, services flowing from an assessment could include domestic assistance, personal care, house and garden maintenance and varying levels of respite care. For this, veterans pay a $5 copayment and for personal care they pay $10 per hour.

Given that the proposal offered continuity of care under one agency, it was clearly supportable, particularly as it proffered some additional quality of life for veterans. It also offered to free up additional funds for HACC, as 20,000 veterans would be transferred out of HACC into home care. There were some concerns, however, beginning with the supposition that, for a cost of $62 million per year, there would be $80 million worth of savings based on the assumption of reduced health costs and reduced incidences of institutional care. To give some assurance that those savings were indeed genuine, an evaluation was committed to, eventually being contracted to the University of New South Wales, on which I understand an interim report has been provided but is being kept very secret.

This new program, while appearing to be like HACC, is administered by different means. Rather than being delivered by the states, largely through voluntary, non-government and community based organisations, home care is delivered by the Department of Veterans' Affairs through contracted agencies on a regional basis, using professional staff and subcontracted service providers. Compared with HACC, it is a high-cost model. The annual budget is divided among the regions, based on some demographic formula. By means of a sophisticated system, all services are centrally recorded and accounted for. The agencies, it seems, have the responsibility for managing all the services, including the apportionment of services and the funding needed. Assessments of individual needs are conducted by telephone by these agencies according to a common standard, and reviews are supposed to be conducted regularly against the standard to ascertain continuing needs.

That sounds like a fine model—in fact a Rolls Royce by HACC standards—but the rub seems to be that, unlike any other veterans' program, the program has a fixed budget. That means that, if more veterans apply for the service and funds are fully committed, the cake must be cut into smaller pieces; hence, we now have some dramatic reductions in services to veterans in many areas of Australia. Without any advice to veterans, many agencies have had their funding allocations dramatically reduced for this financial year, leaving the agencies to pass on the news to veterans and widows that, despite their assessed needs for care in their own homes, their services are to be reduced. That is now leading to some very unsatisfactory consequences in that veterans, having been promised the world, are now in some cases having the standard of their service reduced to a level where they would have been better off under HACC. And, as I understand it, some are doing just that—going back to HACC.

My colleague in the other place the member for Braddon in fact raised this issue in the adjournment debate last Monday evening, citing the circumstances of an agency in North-West Tasmania. The budget for that particular regional contracted agency had been reduced from $311,000 to $228,000 this year—a cut of $83,000 for an increased list of veteran clients. There is therefore no choice for the agency—the 300 veterans on its books must have their services slashed to meet the budget cuts and no new clients can be taken in. So a waiting list has been drawn up, and those in need who cannot be satisfied are referred back to HACC, which is struggling to meet the demand. The same tales are also coming out of other states.

For the agencies, this of course is a real problem because they in turn have contracts with their subcontractors for agreed levels of service, all of which now need to be reviewed and written down. So administratively this program has become a nightmare. Imagine the concerns of veterans who are now told that what they were once assessed as needing is no longer available and, by inference, that their ability to remain in their own homes is similarly reduced. This is indeed the situation in a number of cases that have been referred to me, including those of TPI veterans who were interned by the Japanese on the Burma railway. One man has had his house and garden allowance totally removed, and no substitute is available under similar conditions. I am advised that this is a relatively common story. A representation I received just yesterday from the North Coast of NSW states:

Veterans have had their hours reduced by half in most cases without notification from Veterans' Affairs.

Care plans may have a three month life span and when a new care plan is received a month after the expiration of the initial plan the hours have been reduced by half. The impact of this is—service has been operating for a month without a care plan only to find that the next plan has reduced hours, however the organisation is out of pocket for staff hours in the interim.

Information regarding changes should come to all organisations so that we are equipped to answer queries from consumers.

HACC services have replaced veterans who changed to Veteran Home Care and now do not have the capacity to service veterans with reduced hours who want to change back to HACC services.

This seems to encapsulate what is happening more broadly—to the detriment of agencies and their subcontractors but most of all to the detriment of veterans and widows who have been misled by false promises and are now trapped. Moreover, this growing debacle also raises the question about the integrity of the program's aims, because clearly it is failing to deliver what was promised. If it is failing to deliver what was promised, it is also failing to realise the savings projected—namely, $80 million per year. But then this is not a new phenomenon, as it seems to me that very few departmental savings options are ever realised, thus corrupting the whole budget process.

I regard this as a very serious matter and I am amazed at this routine whereby agencies and their ministers can bid for what is called `new policy' on the basis of offsetting savings and then blithely forget the savings, take the money and press on spending. In fact, this is one reason we see budget overspends, and it is particularly the case with Veterans' Affairs, where most of the budget is funded through standing appropriations—that is, open-ended funding, where what is demanded is paid. This then also begs the question about the adequacy of estimating processes; as we have seen in Senate estimates, adequate answers have not been forthcoming.

The home care program is a case in point. First we are presented with what seems to be an eminently good idea, which we support— that is, that retaining veterans in their homes is preferable and more cost effective than institutional care. So far so good, but then we look at the savings. True, there is some logic to the proposal and, yes, one would expect savings in the health budget, but how much? Where was the $80 million promised in the measures estimated? More importantly, how will it be measured in a budget in which there are few controls and so many variables?

In this context I refer to answers I routinely receive in the Senate estimates, in response to my probing on the adequacy of estimates, that overspend on veterans health, despite falling numbers, is due to shifts to higher cost services due to ageing and the use of higher technology. Frankly, that is too easy and it should not be accepted without hard evidence, simply because there are so many other factors, such as program design and policy, which are equally responsible. We in this parliament vote annually to appropriate this money, yet at the same time we can have little confidence about the advice we are being given by the government as to the accuracy of the estimates on which it is based.

It seems to me that the much vaunted Charter of Budget Honesty is a fraud. I note to the Senate that I currently have on the Notice Paper a number of questions trying to get to the heart of this very issue because, as sure as night follows day, the department will be back for additional estimates which, as we know, can totally change budget figures. The example of home care is therefore interesting in that, unlike most other veterans programs, it seems to be fixed. So if demand increases, some will miss out or others will be cut. In terms of budget certainty, this is probably a good thing but it does demand that program design should take that limitation into account, and clearly it does not here. So again, like the gold card, we have another magnificent promise in the process of being diminished and broken.

The 20,000 veterans estimated as transferring from HACC are probably ruing the day they transferred, and the agencies are probably regretting doing business with the Department of Veterans' Affairs. Contracting agencies are very worried about their business viability and of course are not happy about their task on behalf of the government—cutting back services to those they have assessed as in need, in good faith, in line with government guidelines. Veterans affected have very good cause to be angry and disappointed. The gloss has gone already and that is very sad because, with a bit more care, the same outcomes may have been achievable.

Debate interrupted.