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Monday, 17 September 2012
Page: 7058


Senator STEPHENS (New South Wales) (16:26): I rise to make a contribution in this matter of public importance discussion about aged care. When my dad was alive and was living here in Canberra, he was able to live in his home because of the dedication and care of the staff at Goodwin Aged Care Services. They supported him through an aged-care package. I was a bit concerned, when Senator Kroger was just speaking, that there seemed to be a presumption that people inevitably will have to move into an aged-care facility. That is not true. The dilemma facing most of us baby boomers is how we ensure responsible, compassionate, even reliable care for our ageing parents at home. Our expectation—and I think it is a growing expectation—is that our aged-care providers will work to improve the quality of life of our elderly folk who, just like Paddy Clarke, want to remain living in their homes, even though they require some assistance.

The community aged-care packages are a great way to do professional assessment of our elderly, who may require just simple services, or they may require a quite complex range of services and levels of support to be living independently, or they may need to have some respite care. But those kinds of issues are so important for the dignity of our ageing population. All of us will confront this, some of us sooner than others. We are a growing ageing population who will be much healthier in our old age than our parents or grandparents ever were. We are also living longer, meaning we will be challenged by a range of illnesses that affect the elderly much more.

The fundamental problem that we have is the fundamental problem that the Productivity Commission addressed in its report released in 2011, and that is that the major components of aged care need to have very separate policy settings—community aged-care packages; support for our carers; support for our aged-care providers, to make sure that there is an investment in the aged-care industry; and support for our aged-care workers, who are caring for the most frail and the most vulnerable in our society and being paid a pittance. There is a huge commitment to increasing the training and support and remuneration for our aged-care workers.

It was a little bit disingenuous for Senator Fierravanti-Wells to come in today and suggest that the changes to the Aged Care Funding Instrument were all about trying to support union numbers. It seemed a little beneath Senator Fierravanti-Wells, who, as the shadow spokesperson for ageing, knows much more than that. But we in the government are very aware of the issues and we have all heard the stories. Senator Siewert and Senator Kroger mentioned that aged-care providers have raised concerns about the Aged Care Funding Instrument, ACFI.

Those changes that were announced in June 2012 were quite important but there were two specific issues, ones that had been raised with many of us, that really needed to be addressed. The first one is about the issue of returning the ACFI subsidy growth to long-term trends and the second is the ACFI redirection changes that are being made as part of the Living Longer. Living Better aged-care reform package. If you have not actually had the opportunity to read this document, which I am holding, and to read about the comprehensive nature and approach that is provided in this response to the recommendations of the Productivity Commission, then I really do commend it to you because it lays out in black and white — and in colour — what the challenges are for us all and the way in which we, as responsible governments over a 10-year period, can actually build a robust and sustainable aged-care system.

Going to the real issues that Senator Fierravanti-Wells and Senator Kroger raised, first of all there is a bit of a myth about the fact that aged-care funding has been cut. That in itself is a nonsense. In late 2011 the government actually increased its residential care estimates by $2.3 billion for the period between 2011-12 and 2014-15 and that was actually reflecting the anticipated growth in aged-care services demand. Since that time the department has actually been working with the aged-care sector very closely on options about how to bring that future growth back to trend. So the notion that there should be exponential growth of investment in the system, which would then be absolutely unsustainable, is being moderated by a conversation with the aged-care industry that asks: how best do we manage the aged-care industry to manage the growth that is confronting us? I think that is a very important issue. In fact, the ACFI monitoring group has been meeting quite regularly. That group comprises representatives of the aged-care sector as well as consumer representatives, gerontologists and clinicians working in this space, and peak bodies being challenged by the practicalities of our ageing population. So the changes that were announced in June are addressing that fundamental issue of trying to bring the rate of future growth in funding back to the long-term trend rate and to redirect funding into other aged-care reforms. Those reforms are not intended to reduce funding for aged-care subsidies. They are being used to fund the shifting nature of comprehensive aged-care reform.

I was a bit perplexed about some concerns that have been raised here, that some people in aged care might lose some services that they currently have and that some people in the same circumstances might be treated differently. That would be a horrific scenario, one that we would not want people to believe could actually be happening, so let me put this on the record very clearly. Under this very comprehensive package—and, as I said, this document is amazing and a great read and outlines the challenges and the policy responses with great case studies that help to actually articulate what is going on—different people in aged-care services definitely are not going to be treated differently and the changes will not reduce the services or care for those residents. Providers are actually going to be required to continue to deliver services based on the care needs of the residents and they will need to maintain a standard of care which is expected under the aged-care standards.

Much, much more can be said about what is going on. This changing environment is very challenging. It is quite difficult to navigate the aged-care system and that is one of the challenges for people who are trying to organise the best aged-care packages for their elderly relatives or family. But let me say about the issue that we have here, about what is included in ACFI—and I know that is something that has been raised with me—that ACFI funding is provided to support the care needs of residents. It is not the only source of funding that aged-care providers have, and let us not forget that. Providers also receive revenue for accommodation from the resident, either as a bond or through charges, and from the government accommodation supplement and from revenue from hostel services, which go to the basic daily fee. The government is not reducing funding for residential care. In fact, the government is increasing funding for residential care from $8.86 billion in 2011-12 to $10.9 billion in 2015-16. Under those reforms aged-care subsidies are projected to grow by 2.7 per cent, which is above indexation.

Let us consider the issue of the changes in our aged-care sector. I acknowledge what Senator Siewert said: aged-care providers, particularly those smaller aged-care providers who cannot deliver economies of scale, will be quite challenged in the overall environment of caring for our elderly in our community. But that is not to do with the ACFI formula; it is to do with economies of scale. It is the communities that are going to have to respond. If we want our elderly to age in our communities, then we have to find the ways to support them. It is not a result of the ACFI formula.