Peter Dutton (Dickson, Liberal Party, Shadow Minister for Health and Ageing) Share this | Link to this | Hansard source

I rise to speak on the Aged Care (Living Longer Living Better) Bill 2013 and the related bills. For the many of us who have had a relative requiring care, the experience can be a daunting and at times personally distressing experience. Irrespective of their financial position, our grandfather, grandmother, mother or father deserve respect, dignity and quality in their senior years. As family members we want to know what options are available for our loved ones. The simpler the system is to navigate, the better for all concerned. There should be opportunities for appropriate care in the home. Understandably, so many want to stay in the surroundings they love and that are familiar to them and their family. If they require residential care—low or high care—there should be options readily available, preferably in their local community.

I do respect the intent of aspects of the reforms that have been proposed. We know that there are many, many challenges ahead and the proportion of the population over 70 years of age is expected to double over future decades. The incidence of chronic disease continues to grow rapidly. One million Australians receive aged-care services subsidised by the Commonwealth, and that is expected to more than double by 2050. Despite this, the government's approach to aged care and much promised reform has been protracted to say the least. The government announced the Productivity Commission's terms of reference almost three years ago. The draft report was released in January 2011, and the final report was provided to the government in June of that year. The minister and Prime Minister did not publicly release the report until August 2011, and it took a further 250 days to respond to the PC's recommendations in the form of the Living Longer Living Better policy.

The government trumpeted the release on the day as a revolution for the sector. The government continues to claim that this policy is a $3.7 billion investment when it is not. Not surprisingly, stakeholders were initially enthusiastic given the flashy headlines. Looking at the finer detail, the proposals are nowhere near as ambitious as first made out. That has been a current theme across the last six years under the stewardship of this government. The government is saving over $560 million through means testing, and they include that as part of the so-called $3.7 billion investment. Over $2½ billion is being redirected from existing programs, including $1.6 billion from the Aged Care Funding Instrument. Places and funding are to be transferred from residential care to home care, and funding will be cut from the Long Stay Older Patients initiative. The net investment over four years is just $284.6 million, not $3.7 billion. In fact, it is less than one per cent of the existing aged-care budget over the forward estimates. The unanticipated changes to ACFI and how they are applied have reduced confidence in a sector already struggling to break even.

It is, to say the least, a ham-fisted and counterproductive way to initiate reforms. In the few months following the policy's release, $3.5 billion of capital projects were found to be in jeopardy as a result of the uncertainty caused. In fact, independent analysis undertaken by the Centre for International Economics for Leading Age Services Australia found a revenue black hole of more than $750 million for providers due to the ACFI cuts. The average reduction for each affected resident is estimated at between $20,000 and $30,000 in care funding every year. This corresponds with what we are hearing from providers, and it is particularly hard on the smaller operators and those in regional and rural areas.

The minister has implied that there has been rorting and 'unusual claiming'. However, at Senate estimates it was confirmed that there has not been a single prosecution in the last five years. The sector is crying out for incentives to invest in new capital to open new beds. The government's actions so far appear to have had the opposite effect. The other significant aspect, recently launched by the government, is the workforce compact. This complex arrangement appears to be linked to the funding lost through the ACFI changes. Under the compact, providers with 50 beds or more must have an enterprise bargaining agreement to receive that funding. Those with fewer than 50 beds do not require an EBA but must still comply with the compact obligations to access funding. In itself, this will impose further cost pressures, again particularly affecting smaller providers in rural and regional areas. Providers unable to comply with these requirements will not be able to access the funding.

Across the sector there is recognition that the hardworking staff in aged care need to be paid well for the demanding and important work they perform, but this proposal, certainly by any objective analysis, seems more about propping up the beleaguered HSU than about genuinely helping the workers, those in care or, indeed, the providers.

The bills before the parliament today enacting the government's Living Longer Living Better policy reflect a small hit-and-miss selection of the Productivity Commission's recommendations. Specifically, the bills: (1) remove the distinction between low-level and high-level residential care; (2) provide a new means test combining income and assets tests and new annual and lifetime caps on means tested care fees; (3) allow accommodation costs to be paid through a refundable lump sum, a rental periodic style supplement or combination; (4) make changes to home care, including requiring contributions for people that enter home care on or after 1 July 2014; (5) establish a new aged-care pricing commissioner; (6) extend the operation of the accommodation bond guarantee scheme to new bond arrangements reflected in the government's reforms; and, finally, establish the new Australian Aged Care Quality Agency to replace the Aged Care Standards and Accreditation Agency from 1 January 2014.

The Aged Care (Living Longer Living Better) Bill 2013 removes the distinction between low care and high care, which is intended to provide one approval process for residential care. It is argued by the minister that this will reduce reassessments and allow individuals requiring a permanent residential care place to access services according to need. The bill proposes changes to the residential care subsidies and fees for residents who enter care on or after 1 July 2014. This includes a new means test combining income and asset tests and new annual and lifetime caps on means tested care fees. As stated in the minister's second reading speech an annual cap of $25,000 will apply for means tested fees, with a lifetime cap of $60,000. Both are to be indexed. Any contribution does require an appropriate safety net. We do not want a situation where people are precluded from necessary care because of what they are required to pay. It is appropriate that the proposed contributions and respective caps are examined as part of the Senate inquiry.

I recognise that there is a delicate balance between funding quality care, ensuring affordability of care and the sustainability of the system overall. In relation to accommodation costs the bill will allow fees to be paid through a refundable lump sum, or a rental periodic-style supplement, or a combination of the two. It is stated that aged care providers will not be able to distinguish between care recipients based on means of payment. Clause 52G(3) provides that the minister may by legislative instrument determine the maximum amount of accommodation that an approved provider may charge, including the maximum daily accommodation payment amount and the method for working out the refundable accommodation deposit. The bill also proposes a new form of home care to replace community aged care packages, extended aged care at home and dementia packages. An income tested care fee will apply to home care for all except pensioners. This again will be capped by year and by lifetime.

The Aged Care Pricing Commissioner is also established for the stated purpose of making decisions on pricing issues. The functions of the commissioner are as follows: to approve extra service fees; to approve accommodation payments that are higher than the maximum amount of accommodation payment determined by the minister; and other functions as determined by other acts or by the minister by determination. Whilst I acknowledge that there are lead times for these changes, the independent review proposed in the legislation is not to commence until 2016 and will not report to parliament until 30 June 2017.

The two bond security amendment bills extend the operation of the Accommodation Bond Guarantee Scheme to new accommodation payment arrangements. The Australian Bond Guarantee Scheme, prescribed in the 2006 act, provides a mechanism by which the Commonwealth may repay outstanding bond balances to care recipients should a provider become insolvent or be unable to refund the balances. There is also the capacity for the Commonwealth to recover the cost of refunding these bonds which is amended through the relevant act to reflect the changes to accommodation payments.

The Australian Aged Care Quality Agency Bill 2013 establishes a new agency. This is to replace the Aged Care Standards and Accreditation Agency from January next year. Aged care providers will be responsible to it for quality assurance of aged care services delivered in the home or a residential facility. The functions of the new agency are as follows: accrediting residential care facilities; conducting quality reviews of home care services; promoting high quality care, innovation and continuous improvement amongst approved providers of aged care; and providing information, education and training to approved providers of aged care.

I am yet to be convinced that red tape in what is already a highly regulated sector has been appropriately streamlined or that it has even been genuinely a priority for the government in this process. I do support high standards and efficient regulation to ensure consistent, quality services for the many vulnerable people in care, but nothing is achieved by unnecessary red tape except a diversion of much needed resources away from those most in need. If we want an innovative and efficient sector, unnecessary red tape cannot be ignored.

The related Australian Aged Care Quality Agency (Transitional Provisions) Bill 2013 enables the transfer of assets and liabilities from the Aged Care Standards and Accreditation Agency Ltd to the Commonwealth to facilitate the establishment of the new agency. Over $20 million was included in the budget for the Aged Care Financing Authority and over $14 million for the Aged Care Reform Implementation Council. About half the council's budget is for communications. The financing authority's role will be to provide independent advice on pricing and financing issues. It will make recommendations about subsidies and payments. It will also approve higher fees for accommodation and extra services not covered by subsidies. While there may be good intent and while we do not disagree with some of the functions performed, there has been a proliferation of separate bureaucratic structures under this government; in fact, it is a hallmark of this government. We believe more focus should be on the resources for front-line services and reducing where possible costly bureaucracy.

The government's time lines are peculiar on these bills. Despite years of deliberation, the bills were only introduced in the last sitting period, and the minister has said that they should be passed immediately. The government has set the snail pace of these reforms to date. The government has not brought the bills on for debate until today. I am not sure why or how procedurally the minister was expecting to ram the bills through the parliament. This is far from what should be normal process.

The coalition is keen to support good reform in this important area. Disappointingly for some, the reforms proposed fall very well short of what was promised. The House should remember that this is the minister who is responsible for delivering 16 early psychosis prevention and intervention centres, yet since 2010, when that promise was made, a grand total of zero of the 16 has been delivered. This is despite the Prime Minister herself saying:

I want to be absolutely clear—mental health will be a second term priority for this Government.

Those people right across the Australian community in the mental health sector, those people who access services provided by mental health providers or, indeed, those people in the aged-care sector can add that quote from the Prime Minister to the long list of broken promises that has come to plague this government. For the aged-care sector, this is not a good track record, and it comes on the back of so many other implementation blunders across the rest of government.

The bills have rightly been referred to a Senate inquiry, and the coalition will carefully consider the findings and the submissions. A number of changes will be enacted by regulation rather than legislation, and some of that detail is yet to be provided and will also require responsible scrutiny. This House should have the opportunity to properly consider any complex changes to aged care. The Senate inquiry provides that opportunity. We need to ensure that we can at least achieve the best outcome from what is before us.

In closing, I want to say to the many providers that I have spoken to around the country, particularly regional providers, that we hear their concerns. We do share their view that this minister has a tin ear when it comes to the concerns that they have raised either with the government or through the peak bodies about some of the sections within this act. It is exactly the reason that we set up the Senate inquiry and asked for people across the sector to provide input so that we can improve this legislation. As I say, the time lines on this legislation have been protracted. It has gone on for the last six years. It is interesting to note that out of the billions of dollars that this government wasted in its response to the GFC not one dollar was spent on aged care: no money for additional infrastructure or for providers, no money in wage compacts, no money for patients and services provided to the clients and residents within aged-care facilities—not a dollar.

This government came into power in 2007 promising that it would reform the aged-care sector. This minister has only been in the portfolio since the second half of these six years of the disastrous Rudd-Gillard government, but the dysfunction has continued up until this very day, and we are seeing it play out in this bill. We all want to see a better outcome for older Australians in terms of their interaction with the aged-care system, and the coalition is committed to trying to resolve some of those outstanding issues. We wanted to entertain consideration of this bill, but we also wanted to ask for providers, for care givers, for people of good intent to come forward to that Senate inquiry to make sure that their detail was provided, that their concerns were aired, and we expected that the government would listen to some of those concerns. This is a government that cannot be trusted. It says, 'Trust us in the detail; we've got the bare bones of the legislation now and we'll rush all of the other detail through in another process,' but this government cannot be trusted.

The Treasurer will deliver the speech tonight that people are anticipating will chart some way forward from the disaster of the last five or six years, but people will not get the outcome that they want from this Treasurer, they will not get the outcome that they want from this government, because that has been the track record over the last six years. Because of this government's dysfunction, because of distractions with leadership, because it has promised surpluses and then failed to deliver them, because it has spent money and run us into enormous debt, it is unfortunate that people who are looking for aged care-services in our country today have suffered because of that distraction. They have suffered because this government decided that aged care was not a priority for the Rudd government and it has not been a priority for the Gillard government.

I think the responsible course of action for this government to take would be to listen to the concerns of those who raised them, quite rightly, in the Senate process and to look at sensible amendments that could be proposed to try and improve this bill. As a parting gesture to the Australian people, with only a few months to go before the next election, in the dying days of the Gillard government, please listen to those concerns of the aged-care sector, of the aged-care providers and the people who seek care and are being cared for in these facilities around the country. Listen to the expertise that they bring to the table.

Listen to their concerns about this compact. They do not want to feather the lifestyle of people like Craig Thomson who now occupy the upper echelons of the HSU. That is what this bill provides: it is taking money away from one part of the aged-care sector and seeing it, at least in part, dispersed back through the HSU. The HSU is a disgraced union body in this country. The member for Dobell, I note, has just been told that he cannot run again for the Labor Party—three months before the election. It is absolute contempt that the Labor Party has for the people in the seat of Dobell and, indeed, that through his own actions he has.

This bill seeks to confer an ultimate benefit on the HSU. People are asking why is that the case, why divert money away from aged care and impose another cost burden on aged-care providers in terms of having to engage with the HSU? Why do they need to do that? I will tell you why: because they decide the preselections of people who sit on this government bench. They decide the preselections of people like Craig Thomson and others who come into this parliament and ultimately decide whether or not they will direct their backbenchers, and frontbenchers, to vote for Julia Gillard or Wayne Swan or Kevin Rudd or Bill Shorten or Mark Butler or—

Ms Anna Burke (Speaker) Share this | Link to this | Hansard source

Order! The member will refer to members by their appropriate titles.

Peter Dutton (Dickson, Liberal Party, Shadow Minister for Health and Ageing) Share this | Link to this | Hansard source

whoever it is, Madam Speaker, that seeks leadership of the ALP. That, when you cut it all down, is what a significant part of this bill is all about. And that is why the Australian public continue to express disgust in this government.

They cannot sort out their own internal issues and therefore those in the aged-care sector have suffered. They do not want to listen to the outcome of the Senate inquiry because essentially all they have sought to deliver through this bill is not reform to the aged-care sector but a blank cheque to the HSU and to the other unions involved. That will be an albatross around this minister's neck. This minister will seek leadership of the Labor Party at some point into the future—I am sure he will; he is an ambitious person.

Ms Anna Burke (Speaker) Share this | Link to this | Hansard source

The member will return to the bill before the House.

Peter Dutton (Dickson, Liberal Party, Shadow Minister for Health and Ageing) Share this | Link to this | Hansard source

For a long time, Madam Speaker, this minister has fooled the industry, but I find as I move around the country talking to providers that they are now starting to see through all of the smoke and mirrors. They are now starting to see this bill for what it is. It is not about a reform of the aged-care sector. If they were serious about doing that they would have done it five or six years ago. They would have applied at least one dollar of the billions of dollars they wasted to the aged-care sector to help build infrastructure and to make it more affordable for people on low incomes to go into aged care, but they sought to do none of that. They pushed it off to the Productivity Commission to try to get through the last election. Then, when they had the Productivity Commission recommendations, they sat on them and pushed them aside because they had run out of money. That is what happened with this government's approach to aged care. Then they tried to pretend that they had some $3.7 billion huge investment, but when you strip it down it is a net extra spend of $250 million over that four-year period and a shameful exercise in deception by this government and by this minister. They need to be called for it.

So what have we done? We have tried to engage constructively with the sector to work out how this bad bill could be improved. What could be changed to improve the situation for aged care in this country? How could we make it easier for people to find their way through the mess of aged care and find a place for that grandmother, grandfather, mother, father or loved one? That is what we sought to do through the Senate inquiry process, and yet what does this minister do? This minister says, 'We are going to ignore that Senate inquiry process, we are not going to listen to the recommendations of the sector, we are not going to listen to people of good will who sought to make this bill better; we just want to deliver for the HSU.' That is really the only objective that the government seeks in this bill. They want to make sure that they repay a dividend to their union bosses, and that really sums up what this whole sad, six-year period in our country's history is about.

This is what it amounts to. The puppeteers have pulled the strings for the last six years, and we have seen it play out through leadership changes which have impacted on the government's desire in this area. This is the point. This government has been distracted by its own leadership deliberations, by the knifing of Kevin Rudd and by the proposed resurrection of Kevin Rudd—not to be. This government, whilst it has been distracted by that, has not concentrated on aged care or the millions of Australians in the future who will seek aged-care services for their loved ones. The government brings this bill in at the eleventh hour of this dying government because they seek to repay a dividend to those union bosses who supported their entry into this place. Craig Thomson—

Ms Anna Burke (Speaker) Share this | Link to this | Hansard source

The member will refer to members by their appropriate titles.

Peter Dutton (Dickson, Liberal Party, Shadow Minister for Health and Ageing) Share this | Link to this | Hansard source

I am sorry. The member for Dobell stands as the monument of the HSU and the government's activities in this place. He stands here as a reminder to all Australians that this government has not had its eye on aged care. In this bill they have one focus, and that is to repay their very heavy due to the HSU. That is what this minister needs to account for.

Accordingly, I move:

That all words after 'That' be omitted with a view to substituting the following words:

The House is of the opinion that further consideration of this bill and the related bills should be deferred until the Senate Standing Committee on Community Affairs has reported on its inquiry into the bills.

Ms Anna Burke (Speaker) Share this | Link to this | Hansard source

Is the amendment seconded?

Andrew Southcott (Boothby, Liberal Party, Shadow Parliamentary Secretary for Primary Healthcare) Share this | Link to this | Hansard source

I second the amendment.

Ms Anna Burke (Speaker) Share this | Link to this | Hansard source

The original question was that this bill be now read a second time. To this the honourable member for Dickson has moved that all words after 'That' be omitted with a view to substituting other words. If it suits the House, I will state the question in the form that the amendment be agreed to. The question now is that the amendment be agreed to.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

I am very pleased and very honoured to speak on the Aged Care (Living Longer Living Better) Bill 2013 today, because this bill delivers security, certainty and fairness for millions of older Australians. It delivers fairer and more flexible arrangements for people looking to stay at home or to move into aged care. This bill is very important to me and to many of my constituents. As I have said many times in this place, the electorate of Hindmarsh has one of the oldest demographics in the country. Twenty per cent of the residents of Hindmarsh are age 65 and over. Many say it is the oldest electorate in the country; I like to say it is the wisest electorate in the country, because with age comes wisdom, and I have benefited greatly from the many older constituents in my electorate.

In my electorate, there are an extra 870 high-care places and 968 low places thanks to the extra funding in 2010 and 2011. On 20 April 2012 we heard the minister announce the $3.7 billion for the Living Longer, Living Better aged care reform. That is a huge increase, and what it means is that people are being looked after when they need to be. As we have heard, many of these people have worked all their lives and paid their taxes. Many have fought in wars. They deserve the best treatment and care that we can possibly give. These people have contributed so much to this wonderful nation. They built the foundations that have allowed us to prosper.

There are a lot of wonderful facilities in and around my electorate that are providing these new places and they deserve, very quickly, due credit for their hard work in this process. They include places like St Hilarion, an Italian nursing home that looks after many more people than just Australians with Italian backgrounds; the ECH; Southern Cross; Masonic Homes; St Basil's; St Martin's; Kilparrin Nursing Home; and the Ridleyton Greek Home for the Aged. All of them do a wonderful job in caring for and looking after those in need in their old age. In addition, I would like to thank the tireless efforts of the staff from each facility who look after those residents to ensure that their lives are happy and comfortable.

This government has also delivered 475 community aged packages in my electorate of Hindmarsh. This is in addition to the 54 extended aged-care at home packages and 20 extended aged-care at home dementia packages. We know how important it is for people to be able to stay in their homes. When you speak to people in my electorate, the majority say that they wish to stay in their homes and be cared for there. These extra packages are very beneficial.

The committee that I currently sit on recently finished an inquiry into dementia and how as a nation we can best care for people living with this condition. Australia is a wealthy nation and Australians are living longer. It is fantastic that we are living longer. Medical breakthroughs allow us to live longer. They allow our bodies to keep going and to keep supporting us for many more years than people in the past. Medical breakthroughs have been good for us. But there is another story. People with dementia are unfortunately growing in numbers. We know that by 2050 the number of Australians with dementia will quadruple. We will have quite an epidemic on our hands unless we do things now to put things in place to look after those people.

We know that not everyone is going to need aged care when they get older. In fact, we would all probably—as I said earlier—prefer to stay home and have the care required to look after us offered there. That is why the government also gave over $3 million in 2011-12 to centres in my electorate for day therapy. Day therapy gives older people the chance to come along and take part in activities away from home. This is a big thing. When you get older, you may lose some mobility and confidence. Having support so that you can get out to one of these day centres is a great thing.

This bill also addresses some of the issues facing those who care for our older Australians. Aged-care workers are some of the lowest-paid workers in Australia. They perform the vital task of looking after our parents, our grandparents and our great-grandparents—the older Australians in our community. We know that most Australians who pursue a career in aged care do it for much more than the financial reward. But pay rises are a big incentive to work in this growing industry. With the aged-care workforce needing to almost triple in size by 2050 to support our ageing population, we need to act now to attract and retain aged-care workers.

That is all part of the Living Longer, Living Better aged-care reforms. The Australian government announced that up to $1.2 billion will be provided to address the workforce pressures. We know that the current workforce is one of the oldest workforces. That is what the demographics of the aged-care workforce in Australia tell us.

Funding will flow through from July by way of a workforce supplement, delivering pay rises for aged-care nurses, care workers and others in the aged-care industry who look after older Australians. An additional one per cent pay rise will be available, above minimum annual wage increases or other wage rises which are negotiated through enterprise bargaining agreements, for workers who are employed by aged-care providers who meet the requirements of a workforce compact.

What does that mean? A personal care worker, who is currently paid the award rate and who is employed by an aged-care provider who meets those requirements would, effectively, see a pay rise close to 18 per cent over four years. Enrolled nurses will receive 25 per cent higher pay and registered nurses close to 30 per cent, in the same situation.

The second part of the Addressing Workplace Pressures initiative is the Aged Care Workforce Development Plan, which will begin in mid-2013. An expert advisory group will be established to focus on better ways to support the aged-care workforce. This group will seek to ensure that, on top of wage increases, those aged-care workers get benefits, including improved career structures; better training and education; and better work practices, including lowering the high rate of workplace injuries in aged care.

The workforce supplement is part of the Addressing Workforce Pressures initiative, which will be delivered in two parts through the aged-care workforce compact and through the Aged Care Workforce Development Plan. These are very important initiatives. As I get around in my electorate and talk to aged-care providers, one of the biggest issues they raise is maintaining and retaining the workforce required to look after older Australians in their facilities.

Another big and fairly complex issue in my electorate is multicultural aged care. The Australian government is committed to ensuring equitable access to high-quality, culturally-appropriate aged care for all people from culturally and linguistically diverse backgrounds. As I said, this is extremely important for my electorate because I have a very high number of Greek Australians and Italian Australians who migrated here in the fifties and sixties, all as young men and women, perhaps in their 20s, perhaps even in their teens or late 20s, who today are the fastest ageing Australians in my electorate. They are now at the stage where they are already needing services or are starting to need them. They are not the only ones. People from culturally and linguistically diverse backgrounds have specific needs that must be addressed. Those needs can be as basic as having familiar food available.

We know that when people develop, for example, dementia, nothing is worse than not being able to speak the language or know what people are saying to you. We know that many older Australians revert to their native tongue when they develop dementia. It might simply be a case of employing bilingual workers who can speak the language of the resident, make them feel comfortable so they feel they are being listened to. All these things are contained within the new strategy, which aims to ensure that aged care is inclusive of people from all backgrounds.

Initiatives outlined in the strategy also include a rolling review of the National Aged Care Advocacy Program, to include an emphasis on promoting, supporting and maximising access to advocacy for older people from culturally and linguistically diverse backgrounds, their families and their carers. It also includes ensuring that the Aged Care Complaints Scheme is promoted to those linguistically diverse background communities, including the use of interpreting and translating services, and working with the culturally and linguistic diverse background sector to provide the cultural competency training for promotion and incorporation into all aged-care services. It also includes developing structured pathways to facilitate the employment of appropriate bilingual staff in the aged-care system. There has been a lot of work going towards ensuring that we have in place a system that caters for all Australians, no matter where they come from or what their background is.

I am very proud of this bill and that is why I am supporting it. One day we as a nation will be judged on how we have looked after our elderly. As I said earlier, many of the people that we are talking about today have paid their taxes all their lives, have worked hard and have gone through wars just to ensure that the foundations of this country are steadfast so that we can live a better life than they did. I am proud to support this bill and I commend it to the House.

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

I support the amendments moved by the shadow minister, because we know that under this government the aged-care system in Australia is rapidly approaching crisis point, particularly if you live in an electorate like mine, which is a rural and regional one, or one of those that involve smaller providers. Prime examples are in Western Australia, where last year the federal government allocated 1,564 additional residential aged-care places to our state. However, only 314 of these beds were actually taken up—it is a great indication. In the preceding year, of the 1,208 beds on offer only 507, or 42 per cent, were taken up in WA. What is worse, over the last three years 786 bed licences, the licence that provides the funding for aged-care beds were handed back to the government—283 of those were from Western Australia. Now in WA we are some 2,400 beds short of our aged-care requirements. That is a lot of people in my state and in my part of the south-west.

The government has chosen not to fund aged care in the way it needs to. Instead, it has wasted billions of dollars on unrealistic dreams and schemes that often have turned out to be nothing less than a nightmare. This is a at time when the group referred to as the baby boomers, those born between 1946 and 1964, start to enter retirement—that section of our community who are now between 46 and 65 years old and are looking at their retirement and aged-care solutions. It also looks as though we will have to defend their superannuation savings from being grabbed by what is just an incredibly wasteful Labor government.

Around nine per cent of our population is aged 70 years or older. That is expected to rise to 13 per cent by 2021 and 20 per cent, around 5.7 million people, in 2051—and this government has sat on its hands. By 2050 over 3.5 million Australians are expected to use aged care each year. As we are ageing we are acquiring more complex healthcare conditions and changing disease patterns, resulting in increasing and changing aged-care needs. The challenges include a larger, increasingly culturally diverse, ageing population. I see that in my electorate.

The dependency ratio in 2007 was six people of working age for every person aged 67. By 2047 this will be almost halved, to 3.2 people of working age for every person aged over 67. So with fewer people generating taxation revenue, care options of concessional and assisted aged-care residents, those with the least resources, will be jeopardised. And at this crucial time, under a dysfunctional Labor government, the agenda in Australia has been to remove support for residential-aged-care provision and waste taxpayers funds hand over fist in so many ways.

The fact that we are debating this bill prior to an election shows that this government has not prioritised aged care at all. It is no wonder that residential aged-care providers are not taking up those bed licences. Despite promises of reform, five years on under this government there is very little actual change in the communities—my communities and your communities—where it is so desperately needed. We have seen the government undertake a litany of reports and reviews, including 20 reviews and three Productivity Commission reports. They were continually ignored. They were put off until now when here we are, just prior to election, discussing aged care. They were continually ignored or responded to with more inquiries without a decision being made or anything being done to secure aged care into the future. However, the bills only cherry-pick a few recommendations of the Productivity Commission report Caring for older Australians, which brings us to the focus of the bill before the House today.

The government's changes to aged-care funding which came into effect on 1 July last year under the Living Longer Living Better program represent, in effect, a knife to the heart of small regional aged-care service providers. I know that because they have told me. When the Labor Party and the Labor government spruiked their plan as the panacea for our aged-care system, they deliberately failed to tell the Australian people that this program in fact claws back $750 million from the aged-care sector over the next 2½ years. The actual practical result, as opposed to the misrepresentations of the government, is that residential aged-care providers will receive less funding for new patients than they got for patients last year. That is what my aged-care providers are telling me. The 2012-13 budget alone will see $500 million of ACFI funding ripped out of a sector that is already under pressure.

Grant Thornton reported, in the Living Longer, Living Better reform report #2, of June 2012:

In the last two months since the Government's reform announcements, over $3.5 billion in planned aged care development projects have been shelved.

That is the actual result. A very frail elderly Australian entering aged care in the current year brings with them federal funding of around $56 to $63 a day less than a resident admitted in the last financial year. Given the average turnover rate in aged-care facilities of around 50 per cent per annum, by the end of the current financial year half of the residents will be supported at this new lower rate. One can only imagine what it is doing in the smaller facilities. I know you can well imagine it, Mr Deputy Speaker Scott. At the end of the next financial year, nearly all of the residents will be on the lower rate of funding. For a 40-bed unit, this would represent a loss of funding of close to half a million dollars by 2014-15. With only 40 per cent of residential aged-care providers operating in the black, I just wonder whether this government has been asleep in developing this policy and presenting it at this late date, so close to the election.

In its media release of 10 August 2012 entitled 'Aged care providers facing a $750 million revenue shortfall', Leading Age Services Australia asserts:

Aged care providers face a revenue black hole of more than $750 million over the next two-and-a-half years …

It also outlines research findings as follows:

… 89 per cent of aged care facilities will face "unrecoverable" losses of revenue under the revised funding model, which came into effect on 1 July, 2012.

"This ultimately means an average reduction of between $20,000 and $23,000 in care funding for each affected resident every year" …

…   …   …

"The average loss per aged care facility is more than $125,000 each year, with some facing revenue shortfalls of up to $560,000. Smaller and rural facilities are potentially the most affected.

I know that also for the reason that these are the providers that come and speak to me directly.

Many aged-care providers in regional Australia are already losing money. The government members need to come out into the regional areas and see exactly what this is doing. Funding for residential aged care is managed under ACFI, the Aged Care Funding Instrument, in which levels of acuity—nil, low, medium and high—are assessed over a range of biological and behavioural factors determining the funding received. The factors are categorised as activities of daily living, behaviour and complex health care, and there are 12 in total. The levels are frequently reviewed in individual patients. In one case recently, from my electorate, the patient's level of acuity rose from low to medium in the behavioural section, due to deteriorating behaviour; however, the payments actually dropped by $18 a day. Astoundingly, as the need increased, the funding reduced.

Given the impending increase in aged-care needs bearing down on Australia in the form of our ageing population, this assault on the viability of residential aged-care providers is not acceptable or sustainable. A $56-a-day loss equates to $392 a week, or $20,440 a year, per patient. The onset of this issue will be insidious; it will be gradual, as more and more residents are turned over and lower payments become far more common. Crunch time will probably be at the end of the current financial year, when the new budgets for these providers are prepared. And if, as I heard, we are to be judged on how we treat our most vulnerable, the Labor government's new funding model is definitely a fail. This is why aged-care providers cannot afford the additional beds: they are already losing on each and every bed, so extra beds means greater losses. And that is why, of the 5,278 new residential aged-care places allocated to Western Australia since 2007, only 910, or 36 per cent, have been taken up, simply because they do not attract sufficient funding. Well, now they are going to attract even less. This government is making it even harder for our elderly by cutting support to the most needy and the most frail.

The other issue to be addressed in the government's changes is Labor's new agenda of interfering in management through the workplace supplement. In aged care the Labor government, as it has in childcare, has sought to enhance union control and government interference. It offers more money for wages, but receiving it can cost providers more than they actually receive. Aged and Community Services WA estimates that an aged-care provider who operates a small 31-bed regional facility would be eligible to receive $17,000 under the workforce supplement principles but in order to receive this would have to commit to an additional $30,000 in wages. That is a false economy—and a devious manipulation from a government becoming famous for such actions.

At the last federal election the coalition outlined our plan for the first-ever four-year agreement, and we set out some areas that we believe ought to be included in any agreement. We are committed to the delivery of a high-quality, affordable and accessible aged-care scheme that meets the needs and the preferences of older Australians. Our goal has always been to provide the very best care, whether in the community or in residential care, and particularly for people in rural and regional areas like my own electorate. The fundamental work on the first-ever aged-care provider agreement is certainly going to be retained. I certainly support the amendments moved by the member for Dickson. And I would say to those members opposite who have not spent time discussing how Labor's policies are actually impacting smaller rural and regional providers that I strongly encourage you (1) not to have aged care as a last resort of this government just prior to an election and (2) to actually get out there and talk to them on the ground; go and talk to the people in my electorate this is affecting so badly—perhaps the people at Tuia Lodge in Donnybrook. I had a whole raft of different providers, not just from my electorate but from other electorates, come to visit me just to say how badly this is affecting them. They are concerned about their ongoing viability. They are desperate to be able to provide the supports and services the people in their care need, and they so desperately want to provide these supports and services. But the government is putting all of that at risk.

I know in talking not only to the providers but to the staff as well that they are very passionate about what they do; they are passionate about the people in their care. And I know that the people who live in those communities desperately want to be able to spend their last years in small facilities in their own communities, and that is the type of facility that is on offer out in our electorates. We need to work hard to make sure these providers are in a position to offer opportunities for people in those smaller communities to actually receive the aged care they need in their local community. So, on that basis, I support the amendments moved by the member for Dickson.

Gai Brodtmann (Canberra, Australian Labor Party) Share this | Link to this | Hansard source

My electorate of Canberra is the largest by population in Australia, so I proudly represent a very large number of older Australians, older Canberrans and older people who look to government to help them make sure that as they live longer they also live better. There are more than 1,100 residents in mainstream residential aged-care facilities in my electorate and I have had the pleasure of visiting many of them. I have spent a lot of time talking with residents and staff and families. Most recently, last week, I was out at Brindabella Gardens visiting Eileen Pegrum, who turned 100 last week, and I am visiting a number of other people who are turning 100 throughout this year, Canberra's centenary year, to drop flowers off for them and take some cake and just catch up with them.

Just recently, I visited Alice Lukac at her home in Isaacs and I spent a wonderful morning with her family—her grandchildren, her daughter her granddaughter and her great granddaughters. They are very interested in education and it was wonderful not just talking to the family about their aspirations for education but also talking to this woman in the family home about her history. I visit many Canberrans throughout the course of my job every week, and it is a great pleasure in many ways to sit at their feet and just listen to the stories and the contributions they have made to Australia and, most importantly, to Canberra—people out at Araluen and St Andrews and Goodwin and Brindabella. I have also hosted a very well-attended aged-care forum with Minister Butler and I have taken the minister to meet with aged-care providers and residents around the electorate as well. He has always been very well received and has always listened very closely to the needs and the discussions with those residents, staff and families at those aged-care providers.

Canberra is fortunate to have so many quality aged-care providers and services; however, we all recognise that the system needs to be constantly improved to meet changing demands. The current aged-care system needs to be reformed to meet the needs of an ageing Australia, and that is what we are doing. I know that, when it comes to aged care, the preference is for people to stay in their family home for as long as possible. We all want to be able to age with dignity in our own home. But, when that is not possible, we all want to be assured that there are aged-care services offering certainty and stability and dignity.

I know, from speaking to the many people in my electorate in aged-care services and the providers, that there are three things of particular concern to my community. The first is the quality of care that is being provided in the aged-care sector, the second is the financial cost associated with aged care, and the third is being confident of access to the right information to make the right choices. I have no doubt that the legislation the government is introducing today will vastly improve the way aged care is delivered in Australia.

The government's $3.7 billion Living Longer Living Better reform package contains five bills that build on the Productivity Commission's recommendations. Many Canberrans who are involved in the aged-care sector made submissions to the Productivity Commission inquiry into caring for older Australians, and these bills represent Labor's plan for the future aged-care needs of all Australians. These are major reforms that will benefit both the key providers of aged-care services and those who need them.

Others will speak in more detail about the specifics contained in these bills, but I want to talk today about the positive impact these reforms will have in my electorate. These reforms will increase and improve the supply of aged-care services so that the sector can better address changes in demand. In a generation's time the population of people aged over 65 is expected to increase from about 3,000,000 to over 8,000,000. Labor recognises that current and future demographic changes are placing increasing pressures on the aged-care sector, which is why we are aiming to increase and improve the supply of services.

In a growing electorate like Canberra, which also serves as a regional hub and provides care to many people living in the capital region, this is a significant and welcome reform. Labor understands that families and those receiving aged-care services want to have better information so they can have greater choice and greater control. That is why we have sat down with industry and with aged-care consumers and age-care workers to create these reforms.

In all areas of health care, access to transparent information and choice is vital. Labor has initiated a raft of improvements for consumers in all areas of health care. Most importantly, empowering people to meet their aged-care and healthcare needs is at the centre of our reforms. I know these measures will be welcomed by aged-care providers and aged-care consumers.

In my many visits to aged care homes and in my conversations with providers and residents, workforce issues are almost always raised with me. They are always, if not at the start of the conversation, in the middle of the conversation. They are up there. We must have a stable, skilled and dedicated workforce to deliver the reforms Labor is bringing about. These bills specifically address the workforce issues in aged care with measures to attract and retain a skilled and capable workforce. There is up to $1.2 billion in funding to address workplace pressures.

I note that the Minister for Mental Health and Ageing just recently announced 72 new aged-care nursing scholarships as part of Labor's commitment to boost the aged-care workforce. This was in addition to an investment of more than 2,800 scholarships over four years. The scholarships provide financial support for people to study nursing at university or to undertake continuing professional development. They also support people who wish to undertake nurse re-entry studies—that is particularly important. These scholarships are part of the government's efforts to address workforce pressures, with the aged-care workforce needing to almost triple in size—as my colleague pointed out—by 2050 to support our ageing population.

I am particularly supportive of the measures that will expand, support and improve access to aged-care services for people with diverse needs. I know the Greek population here has its own aged-care facility and it is particularly important that the diverse needs of Australia's population and of Canberra's population are factored into future aged-care services. My electorate is not just large but very diverse. In all areas of service provision, understanding and catering to a range of different people's needs is critical. This is something the government truly understands and is acting upon. For my electorate, this means the quality of aged-care provision will continue to improve, and Canberrans can feel confident that their loved ones will receive the best quality care possible.

The other issue raised with me is the financial cost of aged-care provision. This is a vexed issue, and I know there are different views in the sector about how to address it. In these bills we see measures that will improve the equity and the sustainability of aged-care sector financing. People entering the aged-care system need to understand exactly how much they have to pay, what they are paying for and why. The current system of government subsidies and user contributions for both residential and home care can vary. The changes we are introducing will greatly improve transparency and provide greater clarity. These reforms will result in better alignment of financial arrangements and ensure a more sustainable future for aged-care funding. Under these reforms, those who can afford to help pay for the aged care will be asked to do so while those who cannot afford to pay will still be able to access aged care.

Through these bills, the government is building a more sustainable future for aged-care funding and giving consumers real choices about how they pay for their care. For the first time, people will have real choice in how they pay for the accommodation they receive. At the same time, we are also improving the regulation of residential aged care. We are making sure there is more opportunity for care recipients and their families to purchase additional services. We are creating an aged-care system that will be simpler to navigate, will be fairer and that will create a better pathway for transition from home to residential care.

We are creating a new veterans supplement, dementia supplement and workforce supplement. We are investing millions into dementia research and help for those affected by this condition. From 1 July next year there will be just one type of approval for permanent residential care. There will also be greater continuity of services, and it will be easier under these reforms for people to move through the aged-care system.

In broad terms, these are the major changes contained in these bills. They are measures that have undergone extensive consultation, particularly here in my electorate of Canberra. I understand that the consultation process has been welcomed and was positive, and that following the introduction of these bills there will be ongoing information sessions both here in Canberra and throughout the country.

Labor is introducing landmark legislation that will create an aged care system that will meet the demands and wishes of our ageing population. I commend the bills to the House.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

I rise, following on from the member for Canberra, who spoke about the importance of seniors wanting to live with dignity in their own homes and that if that were not possible, with certainty and stability in aged care facilities such as retirement villages and nursing homes. On that point I certainly agree with her wholeheartedly, as I am sure all members in this House would.

We do have an ageing population, and that is why discussion about the Aged Care (Living Longer Living Better) Bill 2013, Australian Aged Care Quality Agency Bill 2013, Australian Aged Care Quality Agency (Transitional Provisions) Bill 2013, Aged Care (Bond Security) Amendment Bill 2013 and Aged Care (Bond Security) Levy Amendment Bill 2013 is so vitally important. Whilst I agree with the member for Canberra on some of the statements she made on the Commonwealth being able to provide for those people in their twilight years, certainly her side of politics has not helped our aged people to be able to live with the dignity that they deserve.

During the 2010 election campaign, the Prime Minister, Julia Gillard, stated that aged care reform would be a second-term priority. In the same election campaign the Prime Minister had to deny that she had not supported big increases to the age pension because 'old people never vote for us'. Last year this Labor government, which tonight will deliver its sixth successive budget deficit, cut $1.6 billion from the aged care funding instrument, the ACFI, to fund a $1.2 billion workforce compact. The ACFI is the means by which Commonwealth subsidies are allocated to residential aged care providers. The government justified this by publicly suggesting widespread rorting was occurring amongst aged care providers, even though there has not been a single—not one!—prosecution in five years. An entire sector has been tainted—sullied—by this outrageous claim.

This government has undertaken numerous reports and reviews, including 20 reviews and three Productivity Commission reports. These reviews and reports have either been ignored continually or responded to with even more inquiries without any decisions being made to secure aged care into the future. Five years on, there is still no change on the ground—five years on.

In 2010 the government asked the Productivity Commission to undertake an inquiry into the aged care system, and the final report, Caring for older Australians, was released by the Prime Minister and the Minister for Mental Health and Ageing, Mark Butler, on 8 August 2011. Eight months later, on 20 April 2012, the Prime Minister and Minister Butler announced the government's response to the report entitled Living longer. Living better.

The bills before the House today implement those parts of the package which require legislative changes, whilst implementations that required no legislative action began in April 2012. The Living Longer Living Better package of the five bills we are debating now does not resolve many outstanding viability issues for providers. These bills seek to: (1) remove the distinction between low-level and high-level residential care so there will be only one approval process for residential aged care; (2) provide a new means test, combining income and assets tests and new annual and lifetime caps on means-tested care fees; (3) allow accommodation costs to be paid for through a refundable lump sum, a rental periodic-style supplement or combination; (4) make changes to home care, including requiring a contribution for people who enter home care on or after 1 July 2014; (5) establish a new aged-care pricing commissioner; (6) extend the operation of the Accommodation Bond Guarantee Scheme to new bond arrangements reflected in the government's reforms; and, finally, establish the new Australian Aged Care Quality Agency to replace the Aged Care Standards and Accreditation Agency from 1 January next year.

In typical Labor style, the government has cherry-picked from the Productivity Commission report, with industry sources estimating that only five to eight per cent of the recommendations have been adopted. We heard the member for Canberra just moments ago talking about how the government had consulted, how it had made wide-ranging representations to the sector. However, we all know, certainly in this House and certainly on this side of the House, just what the level of Labor consultation goes to. It is not sufficient, it is not adequate; it is never anywhere good enough. The final report received extensive industry support, with 500 submissions made to the Productivity Commission during the inquiry and an additional 500 made following the release of the draft report. Yet Labor all too often ignores the advice it has been given, as it certainly did when it decided to come out with a report following on from the Productivity Commission's, and it does not go far enough to talk to the industry sectors, whether it is agriculture, defence or, in this case, aged care.

According to a Grant Thornton report from June 2012 following the announcement of the Living Longer Living Better package, more than $3.5 billion worth of planned aged-care development projects have been shelved. Further, an August 2012 media release from Leading Aged Care Services stated that aged-care providers face a 'black hole of more than $750 million over the next 2½ years'.

The Aged Care (Living Longer Living Better) Bill 2013 will remove the distinction between low-level and high-level residential care, so there will be only one type of approval for residential aged care. The minister has argued this will mean fewer reassessments and allow individuals requiring a permanent residential care place to access any service to meet their needs. The bill will make significant changes to the residential care subsidies and fees for recipients who enter care on or after 1 July next year. This will include a new means test combining incomes and assets tests and new annual and lifetime caps on means tested care fees. As the minister outlined in his second reading speech, the annual cap of $25,000 will be applied for means tested care fees, with a lifetime cap of $60,000. These fees are also both to be indexed.

With regard to accommodation costs, this bill will allow fees to be paid through a refundable lump sum, a rent or periodic style supplement, or combination thereof. Aged-care providers will not be able to distinguish between care recipients based on how they will pay for their accommodation. Clause 52G-3 will provide that the minister may, by legislative instruments, determine the maximum amount of accommodation payment which an approved provider may charge a person, including the maximum daily accommodation payment amount, and a method of working out the refundable accommodation deposit.

This bill will also introduce a new form of care, home care, from 1 July 2013 which will replace community aged-care packages, extended aged care at home and extended aged care at home dementia. An income tested care fee will also be applied to home care for all except full pensioners. This fee will also be capped by year and lifetime, starting on 1 July 2014. The Aged Care Pricing Commissioner will be established under this bill to make decisions on pricing issues. The functions of the commissioner will be to approve extra service fees, to approve accommodation payments which are higher than the maximum amount of accommodation payment determined by the minister, and other functions as determined by other legislation or by the minister. Furthermore, this bill provides for an independent review to commence in 2016 and a report to the parliament by 30 June 2017.

The Aged Care (Bond Security) Amendment Bill 2013 and the Aged Care (Bond Security) Levy Amendment Bill 2013 will extend the operation of the accommodation bond guarantee scheme to new bond arrangements reflected in the government's reforms. The Australian bond guarantee scheme as prescribed in the 2006 act provides a mechanism by which the Commonwealth may repay outstanding bond balances to care recipients should a provider become insolvent or unable to refund balances. There is also the capacity for the Commonwealth to recover the costs of refunding those bonds according to the Aged Care (Bond Security) Levy Act 2006, which is amended to reflect the changes to accommodation in the Aged Care (Living Longer Living Better) Bill 2013.

The new Australian Aged Care Quality Agency, to replace the Aged Care Standards and Accreditation Agency from 1 January next year, is established under the Australian Aged Care Quality Agency Bill 2013. This new body will be the sole agency which providers of aged care will deal with in relation to quality assurance of aged-care services providers, whether in the home or in a residential facility. The functions of the new agency will be to accredit residential care facilities; conduct quality reviews of home care services; promote high-quality care innovation in quality management and continuous improvement amongst approved providers of aged care; and provide information, education and training to approved providers of aged care. The Australian Aged Care Quality Agency (Transitional Provisions) Bill 2013 will enable the transfer of assets and liabilities from the Aged Care Standards and Accreditation Agency Ltd to the Commonwealth to facilitate the establishment of the new Australian Aged Care Quality Agency from New Year's Day 2014.

On 7 November last year I hosted the shadow minister for ageing and mental health, Senator Concetta Fierravanti-Wells, in my electorate of Riverina. We held a forum attended by a large number of aged-care providers and interested people at Griffith to discuss their thoughts and concerns about the Living Longer Living Better proposals specifically and aged-care services more broadly. We also visited Scalabrini Village, Griffith, where Lauren Kingsbury showed us through before we visited the Griffith Neighbourhood House to discuss with Monica Beckman the facility and the funding needs it has to continue to provide much-needed services to the community—a community, I might add, which has been hard-hit in recent times by poor water policy from this government, and a community which has an ageing population. Many of those people came to this country to start a new life after the ravages of World War II. They did everything this government required of them in building a wonderful city and a wonderful community, and they now deserve the very best treatment in aged-care services that this country and this government can provide, because they have done their bit to help this nation—certainly to grow food to help feed this nation and others—and now we owe it to them to repay that faith that they showed in this country. Many of them, of course, are Australian born, and they too have done their bit—more than their bit, I might add—to help this country and to make it the great food provider that it is. It behoves us to make sure that we look after those people in their twilight years.

One of the major failings of this package is the opportunity the government has missed to reduce the administrative burden—and haven't we heard that on so many levels, in so many speeches that I and many of my colleagues have given—and the red tape and, in too many cases, the green tape. In a sector already swaddled in red tape, this package will deliver even more regulation. The point is repeatedly made—and indeed, was made at the aged-care forum in Griffith that I hosted—that aged-care nurses spend a significant amount of time on unnecessary paperwork. This package is only going to make the piles of paperwork grow and grow and, unfortunately, grow.

The coalition wants reform in partnership with the aged-care sector, and we will provide that. Hopefully, we will be able to do that after 14 September. We do not believe fundamental reform should be imposed from above. Should we be elected to government, we will deliver the first ever aged-care providers' agreement framework, which will be the cornerstone of all of our policy. We want this agreement in place within a year of our taking office in order to begin the real reform that this sector so desperately needs and that Labor has continually failed to deliver.

In my time available, I will also mention the Haven's recent $7.8 million upgrade, which was completed and opened on 27 March. I was fortunate enough to be at that opening with the general manager of that fine organisation, Shane McMullen. Interestingly, the renovation and enlargement of 36 single rooms within the Nan Roberts Community, the construction of two more rooms, improvements to staff facilities and all of the rest were done without government grants. Recurrent funding was used to complete the upgrade, and the South Wagga Lions Club, a wonderful community organisation, did so much work and so much fundraising to make that a reality. All too sadly, in regional areas communities are left to fund their own projects. I could mention the radiotherapy centre at Wagga Wagga, where the community pitched in when there was no—or very little—government help forthcoming to make sure that they got their own facility, which is now the pride of southern New South Wales as far as those facilities are concerned. It is used all too frequently, I might add, because of the number of cancer sufferers and patients in southern New South Wales. But it is still a marvellous and necessary facility. At the moment, there is a very dedicated group of people working to provide palliative care services in Wagga Wagga. Hopefully, this government or a future government will be able to provide much-needed funding for that particular issue and that particular cause, which is so very vital in Wagga Wagga and, indeed, the Riverina electorate I represent.

Louise Markus (Macquarie, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Aged Care (Living Longer Living Better) Bill 2013 and cognate bills. I believe that one of the ways we as a society are judged is the way in which we look after and care for our elderly. Those in aged-care facilities are at a very vulnerable and sometimes difficult stage in life. We have all been in a position where a grandmother, grandfather or parent has had to go into aged care, and as fellow human beings we know that our elderly deserve not only dignity but also respect at this stage of their lives. We have a responsibility to the aged—to our seniors—to provide them with the best services and care available and to support the service providers who engage and respond to their needs.

During the 2010 election campaign the Prime Minister said, 'If re-elected, further aged-care reform will be a second-term priority for my government.' Australians can add that statement to the list of broken promises by this Prime Minister. We have seen a government undertake a litany of reports and reviews, including 20 reviews and three Productivity Commission reports, which are continually ignored or responded to with more inquiries without making any decisions to secure aged care into the future.

Despite promises of reform, five years on there is very little evidence of real change on the ground, where it counts the most. After five years of Labor's neglect our aged-care system needs urgent change to provide viable and effective aged-care services for older Australians. Labor has failed to undertake proper and sustainable reform and to make the hard decisions to give effect to it. It is clear that the Living Longer Living Better package of five bills does not resolve many outstanding viability issues for providers. Under these reforms there have been cuts from the Aged Care Funding Instrument—ACFI—that have placed substantially more pressure on the sector. The bills only cherry pick a few recommendations of the Productivity Commission report Caring for older Australians from August 2011. They add to regulation in what is already a highly regulated sector. The bills establish the framework for the workforce compact, which has created uncertainty, potentially will be costly for providers, relies on cuts to ACFI and appears to be a political mechanism to unionise the sector.

Only the coalition has a clear plan for the future of aged care in this nation. We understand that it is only by working closely with the sector and consulting those who are on the front line that real reform can be achieved. We want to work in partnership with the ageing and aged-care sector to achieve sustainable reform through our first-ever four-year aged-care provider agreement. Older Australians in the sector are no closer to knowing how structural reform would be introduced and how it would affect the care they receive and where they receive it.

The ageing of our population is one of the biggest social issues facing Australians and is an issue that needs to be addressed now, not somewhere down the track or into the future. Australians are living longer, but we have a rapidly ageing population. In its Global ageing 2010: an irreversible truth, Standard & Poor's rating service said that age related spending on health, pensions and aged care in Australia is estimated to rise to 14.4 per cent of gross domestic product in 2050. It is currently 9.6 per cent. Around nine per cent of our population is aged 70 years or older, and this is expected to rise to 13 per cent by 2021 and to 20 per cent—around 5.7 million people—in 2051. As we are ageing we are acquiring more complex health conditions and changing disease patterns, resulting in increasing and changing aged-care needs. With fewer people generating taxation revenue, care options for concessional and assisted aged-care residents—those with the least resources—will be jeopardised.

There is growing and alarming evidence that the aged-care sector cannot provide the care that Australians expect. There are real economic implications for our nation because of our ageing population, and these implications have not been taken seriously by this government. Until there is a proper structural reform of the sector, the care and wellbeing of senior Australians is in jeopardy. Australia has one of the most advanced aged-care systems in the world. However, it can be complex and difficult to navigate. Currently over one million older Australians are receiving aged-care services subsidised by the Australian government. It is expected that by 2050 over 3.5 million Australians will be using aged care each year. Formal aged-care services are delivered through around 8,000 outlets across Australia, including about 3,660 agencies registered as delivering services funded through the HACC program, 2,095 operational community care services delivering community packages, and more than 2,700 operational residential aged-care facilities. The number of over-85-year-olds, which are the main users of aged-care services, will increase from around 400,000, or 1.7 per cent of the total population, in 2007 to 1.6 million by 2047—about 5.6 per cent for the population. The Department of Health and Ageing estimates that by 2050 aged-care expenditure will account for three per cent of GDP and a bit more than 827,000, or five per cent, of the Australian workforce may be engaged in the provision of aged care.

If there was ever a call to action for reform of aged care, this is it. These statistics are alarming and call for careful planning and action. However, at a time when there is increasing demand for services, providers are walking away from the sector because of the lack of viability of providing high-care beds and the increase in compliance demands of the government. It has been reported that up to 60 per cent of aged-care facilities are operating in the red. That is a staggering amount and reflects the economic situation that many providers find themselves in. Providers are handing back licences, and senior Australians are having to wait longer or travel further to find a bed, thereby placing extra pressure on the public hospital system and, most importantly and unfortunately, on their families. This is in contrast with the situation that we would hope to achieve under the coalition.

The Productivity Commission's final report, Caring for older Australians, was publicly released by the Prime Minister and minister on 8 August 2011. This report focuses on a shift from the current ration system based on licences and packages to an entitlement based system whereby aged care would become part of the health system. Other key features of the report include the creation of a single Australian seniors gateway agency and the recommendation that funding be replaced by a single national care co-contribution regime, which would apply across the aged-care system, whether services are delivered in the community or in a residential aged-care facility. It took the Australian government over 250 days to respond to 58 recommendations within the Productivity Commission's report. When that response finally came it was announced with great fanfare as supposedly extensive reform of the aged-care system. Whilst the headline figure of $3.7 billion over five years sounded impressive, the actual amount of new money to be spent was $577 million. Furthermore, many of the changes will not start until 1 July 2014, so the effect will not be felt until well after the next federal election. The coalition and I acknowledge that one of the failures in the aged-care reform package is the missed opportunity to reduce red tape. This is something that the sector has been urgently demanding. In a sector already wallowing in red tape, this package will heap on them more red tape and more bureaucracies to deal with. The coalition has been advised that aged-care nurses spend on average a third of their time on paperwork. Under this package, things are only going to get worse.

This is not real reform; this is another case of Labor talking but not doing anything. Some key issues have caused major concern to stakeholders: the decision to rip $1.6 billion out of the ACFI, the $1.2 billion workforce compact, and the establishment of the Aged Care Financing Authority. One critical need to be addressed is the almost 321,600 Australians living with dementia. When in government, the coalition committed $320 million in the 2005 budget to help fund the Dementia Initiative, making dementia a national health priority. Despite this initiative proving invaluable to help dementia sufferers, and a government evaluation of October 2009 finding the initiative successful, Labor deliberately dropped funding for this program. It was pleasing to see that at a subsequent meeting of health ministers dementia has now been made a national health priority. The coalition is committed to delivering a high quality, affordable and accessible aged-care scheme that meets the needs and preferences of older Australians.

At the last federal election, the coalition outlined its plan for the first ever four-year agreement and we set out some areas which we believe ought to be included in any agreement. We undertook to provide certainty of care through the first ever four-year aged-care provider agreement with the aged-care sector, and as part of that process we outlined various areas for inclusion in such an agreement. There was a very positive response. Since the last federal election, the coalition has continued to listen to the aged-care sector. We will be revising our policy before the next federal election. The fundamental framework—the first ever aged-care provider agreement framework—will be retained. It is important to stress that this is the first ever aged-care provider agreement. It would ensure certainty and engagement for the aged-care sector. In much the same way as the pharmacy agreement shapes that sector, this agreement would set the framework for aged care in Australia for the next four years.

The coalition plan to reduce red tape as an important component of our four-year agreement. Providing flexibility and certainty, we want to work with the sector to cut red tape in ways which will provide efficiencies without compromising the quality of care. The agreement will deliver better and more affordable aged care by: reducing red tape and enabling nurses to get back to nursing residents; providing certainty for aged care for older Australians, underpinned by a high quality framework; delivering value for money through revised subsidy arrangements; ensuring certainty for the aged-care workforce; establishing a more flexible and viable aged-care provider network to meet care needs now and in the future; and ensuring that the comfort and safety of older Australians is maximised.

The coalition want reform in partnership with the aged-care sector. We do not believe that fundamental reform should be imposed from above. Given the opportunity to govern following the next federal election, we will immediately commence consultation with stakeholders in the ageing and aged-care sector on the framework for the aged-care provider agreement, including consideration of the recommendations of the Productivity Commission. The coalition want an agreement in place within a year of taking office.

The coalition does not want to pre-empt the contents of any negotiated agreement. The agreement framework establishes a formal pathway for future dialogue between the minister, the government and stakeholders to more effectively consider ongoing issues regarding timely and appropriate access to aged care. It will guarantee flexibility and much needed certainty in the sector. Principal Endeavour aged-care facility, in the electorate of Macquarie, have the following statement in their mission statement:

Our aim is not just to provide a home, but to provide a lifestyle surrounded by a caring, active, wholesome community.

I too believe that this should be the aim of every aged-care facility, but this can only happen by real change and reform and through the government partnering with the sector to allow them to do what they do best. I support the amendment moved by the shadow minister today and commend it to the House.

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

I strongly support these bills finally passing into the House. It has been disappointing that it has taken so long for them to finally make it to the chamber, but I hope that they do pass this House and the other place relatively quickly, because I know there are many, both in the workforce and as aged-care providers, in the sector who are very keen to see this legislation pass.

In my electorate on the mid-North Coast of New South Wales and, indeed, on the east coast, aged care is the boom industry of the moment. Quite often, it is not seen as an economic driver and an economic sector, but for my region and, indeed, for the east coast, we are seeing more growth in aged care than in industries such as mining and more jobs in health and community services than in the mining sector. It does fly under the radar, but this is an incredibly important economic driver for the east coast and for regions like the mid-North Coast of New South Wales as service provision for our ageing demographic becomes more and more important in Australia over the coming years. I am certainly a strong advocate of getting the aged-care sector right and making sure that we provide the best quality of care possible for the many residents in our area who, in a number of different ways, require services.

By way of a stocktake, in the Lyne electorate on the mid-North Coast of New South Wales, we currently have 409 community aged-care packages; 40 Extended Aged Care at Home packages, known as EACH packages; and 24 Extended Aged Care at Home Dementia packages. All of those touch only the surface of what is really required. I think that is a mood shared by all members in this chamber. Whilst each of these packages is certainly welcome, the need far outweighs what is being provided to date by all levels of government and by both sides of parliament. Ensuring that a quality level of service is provided in what is a growing market in communities such as those on the mid-North Coast is an enormous challenge. In 2012-13, 144 home care package places were also advertised in the mid-North Coast aged-care planning region.

I am not one to criticise the aged-care sector at all. At times, various stories emerge in this parliament or in various communities that shock you, but they are rare. I believe that the quality of care in Australia today is at a level of excellence that we as a country should actually be very proud of. Both our monitoring and reporting standards are some of the best in the world and, again, I do not think we sing the praises enough of our culture of care for the various stages through the ageing process.

Every day on the mid-North Coast I see quality providers, a quality workforce and families of carers who really do rally around their family members, who work their way through the spectrum of care and who really want to see the best outcome possible for them. We as Australians should enhance that culture and, hopefully, this range of bills today will be another step along that journey.

I have tracked these bills pretty closely with the support of some local aged-care providers, whom I would like to mention: Dennis Marks, the CEO of Bundaleer Care Services; John Butler, the CEO of Nambucca Valley Care Ltd; Errol Curran, the Director of Residential Aged Care Services and the Chief Financial Officer of the Bushland Health Group; and Steven Quirk, Chief Executive Officer of St Agnes' Parish, Catholic Care of the Aged, in Port Macquarie. Others have been involved at various times in our roundtable meetings that we have been holding. The group wanted to take up with the government a range of detailed issues that have emerged, in particular with Minister Butler, to the point where, three or four months ago, I brought them down to Canberra and the minister kindly met them. It looks as though, as a consequence of some of those meetings, there have been some changes to the final bills. That has been a worthwhile process. The feedback from the group at this stage is that this package of bills is not going to cure all ills. It is not going to get the workforce pay to the level it should be, to be competitive to attract the absolute best staff possible, but it is a step forward.

Likewise, there are some issues for mid-tier residential providers in lower socioeconomic communities. There are still some question marks about this aged care reform package continuing to allow those very noble and important providers to stay viable. But I am fully aware that the government is watching and tracking that and, if there are issues that emerge, hopefully all governments will be very quick in responding to that. As one part of a suite of measures, this package of reforms I think is one to support, and hopefully the House supports it relatively swiftly.

This fits in well with some local work that we have been doing. The mid-North Coast is one of the first regions in Australia to develop a dementia care plan. We do have an epidemic in Australia coming, if not arrived, in the area of dementia. Rather than just wallow in the concerns of the epidemic hitting us, I am really pleased that our community has come together and put a bit of a strategy together that will align well with these aged care reforms. And I would encourage government to have a look at the work we have done and to provide what resources are possible to allow our region to maximise the work we have been doing locally in trying to deal with the very high number of dementia patients now, and with the significant growth expected in the near term.

The other point I did want to make is on the jobs plan we put together locally. As I said before, the health and community service area is our boom industry of the moment on the mid-North Coast, and so aged care workforce needs are really important to us. I wanted to take this chance to thank the many people who have been involved in the many meetings in making sure our workforce needs meet the demands. They include the local employment coordinator, Renee Hawkins, the aged care workforce coordinator, Jan Johnson, and the new group that has come into town, the Aged Care Workforce Innovation Network. This group is now funded by the Australian government and led by the aged care peak bodies in partnership with the Community Services and Health Industry Skills Council and is now starting to pull together some really good work in our region to address a lot of these workforce needs today and into the future.

I am pleased that, because our region has been working so hard with so little and had to collaborate a lot, we have now become one of the regions to lead in this workforce innovation network. Collaboration is one of the keys that allows that industry development work to take shape. Very quickly, of the 10 regions funded, the mid-North Coast is looking like one of the standouts because we have been collaborating on the smell of an oily rag for a long time, and had to do that to basically survive as a region. I thank everyone involved in that process, both within and around government but also more importantly at a committee level, for really investing time and energy into the many meetings—everyone hates meetings, but they have made a difference and they certainly are setting us up as a region where our aged care workforce will be viable and strong, our providers will be viable and strong and our quality of care, therefore, will be viable and strong.

I think the mid-North Coast is one of the best places in Australia for anyone to hit retirement age. That is not only for the healthy living issues and all of our wonderful beaches and rivers, but also for that spectrum of care around aged care, when and if required. I hope these bills go through, I hope they go through with bipartisan support and I hope they make a big difference in once again taking a step forward in the quality of care for the aged care sector in Australia today.

Debate adjourned.