Gavan O'Connor (Corio, Australian Labor Party, Shadow Minister for Agriculture and Fisheries) Share this | Hansard source

It gives me great pleasure to participate in this debate here in the chamber today on the Aged Care (Bond Security) Bill 2005, the Aged Care (Bond Security) Levy Bill 2005 and the Aged Care Amendment (2005 Measures No. 1) Bill 2005, because aged care is an issue of serious concern to my constituents. The overall objective of this legislation is one that Labor supports, and Labor will be supporting the passage of these bills through the House.

As I said, the overall objective of the legislation is one that we support—that is, to provide greater legislative security for bonds that receivers of aged care services are required to provide in order to access care. Bonds constitute the initial payment that residents often pay approved providers in order to access a service and are usually refundable when they leave the service. Because bonds often constitute a significant proportion of a resident’s life savings, it is extremely important that adequate and comprehensive protection arrangements are put in place to secure the bond payment. I believe there is bipartisan support from both sides of the House for these measures; and the sooner these provisions are implemented, the better for residents and their families.

Australia does face the ageing of its population. That has huge implications for policy in a number of important areas, particularly aged care, health and housing. For example, by 2040, 25 per cent of the population will be over the age of 65. In the Geelong area—and that is the area encompassed by my electorate—we have certain pressures that are contributing to the growth of the aged care industry in our region. We have the internal population demographics; we have movements from the Western District to Geelong and the coast, and we have the sea change effect where people are moving from major metropolitan areas to the coastal regions in the Geelong area. That simply means that the ageing of the population in the Geelong region is going to be a very important factor that will have to be factored into the policies that are developed at the local council level and at state and federal government level to accommodate these changing demographics in this particular part of Australia.

The City of Greater Geelong has a statistic that persons over 65 years of age constitute 15.2 per cent of the population. When compared with the statistics for Victoria, we see that that is a higher figure, as the statistic for Victoria for people over the age of 65 is 13.3 per cent of the population. So the situation is already there in a structural sense, and the demographics are moving in such a way that there will be a significant demand for aged care services in the future.

This has been recognised in the economic development documents that have been produced in Geelong over the time that I have been the member for Corio. The Kelty taskforce report, way back in the early 1990s, indicated this particular trend and the importance for Geelong and its region to start planning now to accommodate an increase in the number of aged care residents and, in effect, to make it an important pillar of Geelong’s economic development into the future.

As I understand it, well over 70 per cent of aged care providers levy bonds on residents. This situation is reflected in the enormous growth of bond contributions in recent years. For example, in 1996 we had around half a billion dollars going into bonds but by 2004-05 that had risen to some $4.3 billion—quite a staggering growth over that period. Correspondingly, there has been a growth in the average bond figure that has been paid by residents. In 1996-97, that stood at some $26,000, and by 2004-05 that had risen to $127,000. That particular bond payment forms a very important part of a person’s long-term savings, and it is appropriate that governments and oppositions support measures that are designed specifically to improve the security of the bond moneys paid by residents.

There is a very simple reason why this legislation is necessary. Under existing arrangements, there is not 100 per cent security for people who pay over these particular bonds. As the Minister for Ageing stated in her second reading speech:

... if a provider becomes bankrupt or insolvent, the resident is not guaranteed the return of their bond balance, because the resident ranks as an unsecured creditor under corporations and bankruptcy law.

Stripped back, that simply means that there is not 100 per cent security for people who put up bond money in the case of a situation where a provider goes bankrupt or insolvent. So it is important that we close off this situation so that all Australians can have 100 per cent security in this matter. I know that in my electorate there are providers who would welcome this piece of legislation, and, for aged care residents and their families across the board in the community, this adds a new dimension to the security that is provided for their bonds. On their behalf, I reflect here in this chamber their support for this piece of legislation. The objectives of the legislation are laid out very clearly in the minister’s second reading speech. The minister said:

... the government’s key objectives are: to improve the efficiency and sustainability of the aged care sector and to strengthen the management of bond moneys to reduce the likelihood of providers becoming insolvent or bankrupt and being unable to repay bond balances; to strike a balance between the added security for residents that is provided by this strengthening and the financial impact of the new arrangements on the sector’s viability and its standing with the capital markets, including its ability to construct and maintain aged care homes and pressures that might flow onto subsidies, user charges and the quality and continuity of care; and last ... to ensure that all residents who pay bonds receive their full entitlement to the balance of the bonds that they have paid in the event that the provider becomes insolvent or bankrupt.

This piece of legislation will pay 100 per cent of the bond balance owed to residents with interest in the event that a provider becomes insolvent or bankrupt and is unable to meet its financial obligations to residents. I do not think there would be any member on either side of the House who would have any objection to a piece of legislation that had those objectives in it.

The aged care sector is a growing sector in the Australian economy, and many people might be interested to know that it is currently the ninth largest employer in Australia and a significant employer in my electorate of Corio in the Geelong region. I have mentioned before that Australia’s population is ageing and in another, say, 45 years people aged 65 and over will represent one-quarter of our population. That changing demographic will, as I have said before, exert quite significant pressures on the national economy and in various other policy areas such as health and housing.

An interesting statistic has been provided by Aged and Community Services Australia. Their budget submission states that approximately one-half of older women and over one-third of older men will use residential aged care at some time during their life and many more will access community care services. I guess all of us at some stage are going to have to confront this situation and decide what sort of care we are going to access in our latter years. I have a particular philosophy—I have had it for a long time—that you run with the ball and die with your boots on! It may well be that I am one of the fortunate ones who will drop over playing ‘super Rules’ football or some other activity—but maybe not; maybe I will be like the honourable member for Paterson, and we may even occupy the same aged care home if I decide to go interstate and live out my days. But, be that as it may, whether or not we access these services, there are plenty of people now who access them and who need the security—and certainly in the future.

Aged and Community Services Australia have listed the key areas for investment that the current government must look at in the budget they are going to present in May. We know that the Treasurer has been raiding the pockets of working people for well nigh on a decade. That is why we have a surplus that is in the billions, and it is incumbent on the government to start investing in the sorts of areas that Aged and Community Services Australia have identified in their submission. Those areas for investment are: service availability, particularly community care and services for clients with high-care needs; meeting the increasing costs of high-quality service delivery; a sustainable capital raising system; the planning regime, which is a very important one that I will speak a little more about; support for rural and remote service delivery; recruitment and retention of an appropriately skilled workforce; and enhancing the efficiency and effectiveness of government expenditure on aged and community care through streamlined administration.

I do not think there would be a member on either side of the House who would have any problem with that set of objectives and those areas for investment that have been articulated by Aged and Community Services Australia in their prebudget submission. Indeed, they do so on behalf of the many community aged care providers and not-for-profit organisations in my electorate, such as St Laurence services and the multicultural aged care hostel which has been built under the auspices of the Geelong Ethnic Communities Council, just to name two. It is very important that the government take on board these objectives, because they do reflect off the floor the concerns of the general community about future investment and the need for it in this very important sector.

In their prebudget submission, Aged and Community Services Australia mention the planning regime, and this is where local government is extremely important to the planning of aged care services at the local government level. My plea goes out to the City of Greater Geelong to make this area a very important priority in their planning schemes. We must have land allocated to the purpose. I have said on other occasions that there are parcels of land in Geelong that are now in what would be considered to be inappropriate inner city use, and they could be turned over to the aged care sector to make state-of-the-art precincts where residents can access appropriate aged care services.

I have spoken in this House before on this matter, as far back as 2 and 3 December 2002, when I raised particular concerns about a nursing home development not far from where I live. This was the Glenburn nursing home proposal. Two quite extraordinary things happened. The Commonwealth health department allocated an extra 30 beds to this facility. At the same time, the City of Greater Geelong gave planning approval for the expansion of the facility. The important thing to recognise about the Glenburn instance was that this was an inappropriate planning development for the location of the particular nursing home. I had this to say at the time:

Given that the current facility is located in a residential area, subject to heritage overlay provisions and near the base of a railway overpass on an extremely busy thoroughfare, handling thousands of vehicular movements per day, how was council officer approval given for an expanded nursing home involving the demolition of residential properties and the construction of a two-storey commercial operation in this residential heritage area?

I went on to say that there were two central questions surrounding the Commonwealth health department approval and the local government planning approval. I said:

These are two central questions which spawn a myriad of ancillary questions relating to council approval processes, planning considerations, VCAT deliberations, care and safety of the aged at Glenburn, residents’ rights and appropriate nursing home developments in the whole Geelong region.

The interesting thing about this development was that the doctors who serviced the facility had extreme concerns about their duty of care and their liabilities under medical indemnity insurance. And the Country Fire Authority had even stated that the facility would pose a huge risk in the case of fire.

I note the presence of the honourable member for Corangamite in the chamber today. At that time, he joined me in a bipartisan approach to the minister, questioning the allocation of these 30 beds, on behalf of residents, and trying to get this matter addressed and the situation changed. The honourable member for Corangamite, in true bipartisan fashion, facilitated my access to the minister on behalf of my constituents. We put the case. We did not have any success in that, but the questions that we raised were valid ones. I understand that the proprietor has now on-sold the beds and that the future of the facility at this location is in doubt.

This once again highlights the importance of local government planning in the provision of aged care in this country, and particularly in the Geelong region. As I said, I note the presence of the honourable member for Corangamite in the House today. In Geelong today there is a scandal about local government and the planning processes. There are real questions being asked about this matter, and no doubt they will be asked on the floor of this parliament in the future.

Having said that, let me say that the matter of the Glenburn nursing home may well be a matter—and we will examine this—that could be referred to the municipal investigator, who is looking at these matters at the local level in the Corio electorate. The need for local government to get the planning right and the need for greater coordination between state and federal governments in the provision of aged care services are a very important issue for Geelong residents. With the march of time—and the honourable member for Corangamite will no doubt echo these sentiments—all of us might be looking down the barrel of spending a stint in these nursing homes. Some of us will reach that destination earlier than others, with all due respect to the honourable members who are in the House at this time.

But be that as it may. The sorts of protections that are given to residents all along the line and the planning that takes place are very important. In this bill we have enshrined a set of measures that will no doubt give greater security to my constituents in the electorate of Corio to ensure that they get good, high-quality aged care services provided in the best locations where they can access other services. I will be supporting the legislation.

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