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Wednesday, 22 June 2011
Page: 3492


Senator FIERRAVANTI-WELLS (New South Wales) (10:23): The Aged Care Amendment Bill 2011 introduces a number of amendments to the Aged Care Act and is part of the government's health and hospitals agenda—I will not say 'reform' because we have not seen too many changes in the system. The bill will apparently strengthen consumer protection for accommodation bonds paid to aged-care services and improve arrangements for the handling of complaints about Commonwealth funded aged-care services. It is little wonder that this legislation is required because it is very clear from the statistics on ageing today that this sector is very much in crisis.

The Department of Health and Ageing no longer releases the general purpose financial reports of providers. If it did, the situation would be probably a bit starker. It is very clear that 40 per cent of aged-care providers are operating in the red. In its 2011-12 budget submission, the Aged Care Industry Council stated:

A snapshot of the industry at the start of 2011 does not depict a sustainable system: only 40% of residential aged care services are operating in the black—

In fact, they were talking about residential aged-care services operating in the black, so it is even worse for residential aged-care providers—

… hours of service are decreasing; hours of care provided under community aged care packages have fallen; and many providers are not building new residential care beds. The situation is worse in rural and regional areas where providers face generally higher costs with less ability to manage their income streams.

Given that the aged-care sector is in crisis and in need of reform, the financial viability of the sector is very much an issue. Providers going into liquidation have increased, although these have remained under the radar due to their facilities being absorbed by larger entities. While it is difficult to quantify the regulatory impact due to the lack of available data, the proposed changes provide a regulatory framework that is commensurate to the risk associated with the strong growth in accommodation bond holdings, which are currently over $10 billion. It will increase the incentive for bonds to be used in a prudent and sustainable way to meet the policy objectives by allowing providers to charge bonds. Any costs related to the charges required of approved providers to ensure that bonds are only used for permitted purposes are minimised through removing current restrictions on the use of income derived from bonds, retention amounts and accommodation charges, and giving providers complete flexibility over how such income is used. Given the concerns and the operating costs that providers are facing today, this will be welcomed.

The proposed transition period of two years allows approved providers time to comply with the new arrangements to ensure, as far as possible, that the financial interests of care recipients are protected and to keep the regulatory burden as low as possible. Having said that, it is very clear that the regulatory burden in aged care is very high. As I travel around to aged-care facilities in Australia, the first thing that I am hit with in just about every facility I visit is the regulatory burden that this government has placed on the sector. Despite the many reviews and despite the advice that this government has been provided with about the regulatory burden in aged care, very little appears to have been done. Indeed, one provider in Tasmania said to me that he had provided submissions to no fewer than 17 inquiries into ageing and this government had really done very little.

Kevin Rudd promised in 2007 that he was going to ease the transition from hospital to aged care. In 2007 he criticised the then coalition government by saying that the government was not providing enough aged-care beds and that people had become bed blockers in acute hospital care. Of course, the term 'bed blockers' is Kevin Rudd's and is not a very complimentary term to refer to our older Australians. When the government first came to power it promised a new direction for frail and older Australians by making the transition from hospital to aged care a priority area. That is why it took $276 million out of the budget last year in order to keep people in long-stay hospitals. It raided the residential aged-care moneys for high care in order to prop up failed state and territory hospital systems and keep older Australians in hospitals.

Senator Polley interjecting

Senator FIERRAVANTI-WELLS: Senator Polley over there is criticising us, but let us take you back to the report when you were chair, back in April 2009, when you yourself were critical of the Department of Health and Ageing. Indeed, you acknowledged that aged care was at a crisis point, and at that point there had been no response from government. So what did the government do? There was only one pronouncement by Julia Gillard before the last federal election about ageing and that was in a speech she gave at the Nursing Federation. She said that aged care was going to be a second-term priority. Well, we are still waiting. So despite the myriad reports, reviews and inquiries into aged care, what did this government do? They shuffled aged care off the front page and back to the Productivity Commission for yet another review. The industry has responded with over 500 submissions. Of course, the Department of Health and Ageing could not get its submission in on time, which meant that the draft report of the Productivity Commission was delayed. The draft was released and now we are waiting for the Productivity Commission to release its report—but then, of course, we will have to wait for this government to respond to that. Given its track record, I am not going to hold my breath, and nor is the industry holding its breath.

This is an industry that needs reform now. Older Australians need help now. They do not need to keep waiting for years and years, as this government is wont to do. Bed licences are being handed back. Senator Siewert has repeatedly commented on the Western Australian situation, and I am sure that she will repeat that in particular. The outlook is bleak in terms of the growing capacity of aged care in Australia. Senior Australians are increasingly finding that they are unable to access the services and care they need when they want them and where they want them. This continues, of course, to place pressure on the public hospital system and on Australian families who want to assist their loved ones into aged care. As Catholic Health Australia have said, every night in Australia there are 3,000 older Australians in our public hospital systems who ought to be better cared for in aged care. It is quite interesting that the AMA figures show the number of hospital beds that are badly needed in the public hospital systems is around 3,000—little wonder, because older Australians are not able to access the aged care they want and therefore there are difficulties. The reality is that as a society we are living longer, we have more complex health conditions and there are changing disease patterns. This is resulting in increasing and changing aged-care needs and with the shift in size and composition of households this is having an effect on our aged-care situation.

Let us look at the two budgets. In both, there has been very little for aged care. In the current budget, apart from Bob Katter scoring some funding for aged-care accommodation facilities—which is apparently some new model the Department of Health and Ageing was not able to give us full details about—we did not see very much there. Of course, the Ambassador for Ageing, Noeline Brown, a three-time candidate for the Labor Party, has been looked after: there was money for her in the budget to continue her work. Actually, there was money taken out of the system, because the government considers that when you shift from high-care residential places in aged-care facilities over to community services that saves money, so there was saving of $211 million over five years in the budget that is not going to aged care over the forward estimates.

As I said, there has been a complete litany of broken promises in aged care. The litany of failures in this area include the delays in the ACAR rounds. The Bringing the Nurses Back into the Workforce Program has failed. We have workforce shortages. We have training places and zero interest loans, but I have travelled all around the place and I have come across three people who have contemplated applying for the zero interest loans but have said it was all too hard and they did not do so. Then we had COAG mark 1 and mark 2—the grand COAG health changes. And where was aged care? Certainly it did not appear in Kevin Rudd's first COAG grand plan to fix the hospitals. Then we thought, 'Well, let's just see what happens in the second one.' Those who participated in the Finance and Public Administration Committee inquiry—and I think Senator Polley was present there—would remember well the scathing criticism of this government over its lack of attention to aged care and mental health.

Senator Polley interjecting

Senator FIERRAVANTI-WELLS: Obviously, Senator Polley, your memory is deteriorating because you cannot remember the scathing comments that were made by witness after witness after witness at those inquiries who criticised the government heavily for its lack of attention to aged care and to mental health. So what have we seen in COAG mark 2? Aged care and mental health have been shunted off for another three years in the mark 2 agreement. There it is, shuffled off into the never-never because it is all too hard.

Senator Polley interjecting

Senator FIERRAVANTI-WELLS: Senator Polley, I would refer you to the Financial Review editorial that described Justine Elliot as one of the most incompetent ministers in the previous government. Of course, she was demoted—and it is little wonder that she was demoted, because she really did not do much in this sector. Now we have Minister Butler, and the sector is still waiting. Obviously Labor senators are not talking to the same people I am talking to, because people are waiting with bated breath to see what this government does.

One need only look at the administrative burden that providers are faced with on a daily basis. When I talk to nurses in aged-care facilities, they tell me that they spend 35 per cent of their time filling out paperwork and providing reports to this government—and they seem to provide the same information over and over again. Once it is for the funding tool, then it is for some other purpose and then they provide their general purpose reports. Every day, instead of being able to care for our older Australians, aged-care providers are being swamped with paperwork on a daily basis. Therefore, I move the opposition's second reading amendment:

At the end of the motion, add "but the Senate:

(a) objects to the growing burden of regulation being placed on small businesses, not-for-profit organisations and industry by this Government;

(b) notes that the Government has broken its election promise to repeal one regulation for every new regulation; and

(c) calls on the Government to immediately adopt practical measures to reduce the regulatory burden on business and the economy".

This amendment focuses on the growing burden of regulation being placed on small businesses, not-for-profit organisations and industry by this government. It notes that this government has broken its election promise to repeal one regulation for every new regulation and calls on the government to immediately adopt practical measures to reduce the regulatory burden on business and on the economy.

The aged-care sector is a very, very good example of the growing regulatory burden. Indeed, this is one area where the government has well and truly broken its election promises. Every day the aged-care sector tells me that it is increasingly faced with an extremely heavy regulatory burden with respect to the day-to-day work that it does. The sector has been calling for reform, and it is very clear from the over 500 submissions that were provided to the Productivity Commission just how much this sector has been burdened. Those submissions are on the public record, and I would invite the government to make sure that it reads every single one of them.

The reality is that, if we do not reform this sector and we do not lift some of the regulation and the heavy regulatory burden, our older Australians will not be provided with the services that they desperately need in their old age and those services will not be available in the places where we want those services to be available. Faced with the situation where a loved one sustains an injury and is no longer able to live in their own home and look after themselves, their families desperately have to scurry through a very, very complicated system. I hear it every day. I hear it even amongst colleagues who, notwithstanding being involved in public and political life, have had to go through this process themselves.

I call on this government to heed the calls of a sector that is desperately in crisis and desperately in need of reform now. As I travel to aged-care facilities in suburban metropolitan areas and most especially in regional and rural areas, I see how they are really doing it tough, and I fear for many of those small aged-care facilities in regional and rural Australia. I was in North Queensland last week talking to providers in that area. They are heavily burdened. If this government does not take much-needed action, we are going to find that more and more providers are going to go out of business and more and more older Australians will not be able to receive the much-needed care that they will need.

Every day we talk about an ageing Australian population, but this government does not seem to understand. For every person over 65, there are now about six Australians working, but that is going to go down to three. Therefore we need to take action and we need to take action now; otherwise tomorrow older Australians will not be able to access and receive the much-needed care that we want to give them and that they will need.