Sharman Stone (Murray, Liberal Party) Share this | Link to this | Hansard source

As I was saying in my earlier remarks before the debate was interrupted: you can imagine that the economies of scale are such that just a few vacancies—perhaps only three or four over several weeks—can make a significant difference to the viability of a small rural or regional aged-care facility that may only have some 40 or 50 beds. Then there is the issue of the burden of the red tape—a crippling lot of regulations, often simply for the sake of regulation, it seems. The sector is stymied by requirements to document and double-document, often requiring the hiring of expensive consultants. Everyone agrees that the sector needs appropriate and tight quality control. We are all horrified when we see in the media cases of the most frail and vulnerable taken advantage of in an aged-care facility. However, that is a very rare occurrence, and most facilities do their utmost to make sure they have an excellent standard of service and safety.

The burden of red tape should not be such that one-size-fits-all is the standard. If you have a facility of 500 or so beds in a metropolitan area, your capacity to constantly send back forms and be oversighted is quite different to when you have a 50-bed facility located on the banks of the Campaspe River. I agree that the requirement for the same quality of care needs to be there, but the capacity for those two different facilities to employ special administrative staff or consultants is quite different. The endless compliance requirements are often replicated, and it kills the passion for the work for many of the aged-care nurses, who are there to support their residents, not to endlessly fill in duplicated and meaningless forms. Given that aged-care nurses earn 20 to 30 per cent less than their acute-care colleagues, this adds mightily to their frustration with their workplace. No wonder the aged-care workforce is ageing and that it is often difficult to attract a new generation of aged-care workers, particularly when there is an acute shortage of division 1 nurses in the nearby hospital. We need the very best quality of care in these facilities. We need men as well as women working in these places, as there are more men coming into aged care.

Numbers of aged-care facilities in my electorate have made the point that we can go too far in keeping people supported in their homes if it means that when they finally come in to residences they have already had a significant compromise in their own health. Of course we support ageing in place. In the Howard government days we significantly advanced the opportunities for older people to remain at home for as long as possible, but it does come to a stage where it is not sensible to provide a whole range of very expensive services to people in their own homes when they are beyond being able to be independent in their own places. We need to watch that we do not swing the pendulum too far in the other direction.

In summary, the Living Longer Living Better package of five bills does not resolve many outstanding viability issues for providers, particularly in rural and regional Australia where the size of the facilities is typically much smaller than those you find in metropolitan areas. The $1.6 billion cut from the aged-care funding instrument, ACFI, under these reforms has placed even more pressure on the sector, and many now fear they are going to the wall. These five bills only cherry pick a few recommendations of the Productivity Commission report Caring for older Australians, which was delivered in 2011. The five bills add to regulation for an already overburdened and highly regulated sector. The five bills establish the framework for the workforce supplement, which has created uncertainty and will be potentially costly for providers. This relies on cuts to ACFI and appears to be a political mechanism to unionise the sector rather than a sensible activity which will make sure that you have a proper matching of the workforce with the workplace.

The five bills are typical of this government's practice of enacting framework legislation and leaving the bulk of the detail to delegated legislation. This is asking us to buy a pig in a poke. It is putting off the hard work until a little later, or is it a case of trying to keep more of the bad news out of the House and therefore genuine debate? We are very suspicious that there is not enough detail in this legislation. It should not be a mere framework; it should give us a great deal of detail, so we can understand whether it serves our ageing population well into the future. We do not know the full impact of these bills yet, and that is a serious problem.

I end where I began, by saying that care of our aged, our frail elderly, our most vulnerable, is one of the most important things a civil society can do. Australia needs to be proud of the quality of its aged-care sector. I commend the member for Mackellar, who, when she was Minister for Seniors, did extraordinarily good work in making sure that the quality and standards of Australian aged care were world's best. But you can overburden the sector with costs and you can underfund the sector. You can overburden the sector with regulation, and all you do is cripple the sector which is so important to the future of older Australians. We are an ageing population. We have a significant number of concerns about proper care of and the best place for those with dementia or Alzheimer's conditions. At the moment in rural and regional Australia we have a significant skilled workforce issue and have difficulty in finding division 1 nurses who need to be in this sector. I am concerned about this set of bills. I think that a lot of the sector is waiting for a change of government to put all of this right. Let's hope a change of government comes soon enough.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I rise to strongly support the Living Longer Living Better package of bills that we are debating today. These bills will give effect to the much needed aged-care reform. In saying that, I do not doubt that members on both sides of this House are committed to seeing that older Australians get the best possible care and the best possible services which will empower them to be active and live independently as long as they can. I believe that we need reform and this reform will transform aged care in Australia and replace an out-dated system.

The current system has a lot of bureaucratic requirements that stifle people providing services. It is a system that has failed older Australians. Not only has it failed older Australians but it has also failed their carers, aged-care providers and workers in the industry. It is time for a change. We need to make it better for everybody involved with aged care, whether they be a person who benefits from aged care or one who is a provider, a worker or a carer. This is very important legislation that will benefit hundreds of thousands of Australians. I urge the opposition to open their minds to the fact that we need change, so that we can have a truly person centred aged-care system and provision of aged care and aged-care services that older Australians need. I do not like the word 'system' because that sounds like institutionalisation. Aged care is about providing care and access to services that older Australians deserve.

I find this is particularly important in my electorate. Shortland is an electorate with one of the oldest populations in the country. Older residents of Shortland talk to me regularly about aged-care services and the need for a change. When a family or an older person is in a crisis you have to react very quickly to try and resolve the problem. The legislation we have before us will provide a vehicle for taking a better planned approach to delivering services to older Australians. The current system is obsolete and it is not person focused. It is a system that has passed its use-by date, unlike the legislation that we have before us today, which will deliver person-focused aged care where the person, the family, the carers and the providers are given the information that they need to make an informed decision. I think it is very important that we empower older Australians and not take away from them the power to determine where they would like their life to go and also to involve the family and all those that are important to those older Australians.

This is legislation that has been developed after wide and extensive consultation. First we had the Productivity Commission report and consultation with the National Aged Care Alliance, and the minister had a national conversation on ageing. Then experts and stakeholder groups were consulted. A detailed paper was put out, and then there was ongoing consultation. This package was not announced just before it was introduced into this parliament; it was announced in April 2012. So there has been a lot of consultation and discussion about this piece of legislation, and I would have to say that within my electorate it has been really well received.

This is a $3.7 billion package over a five-year period. It encompasses a 10-year reform program to create a flexible and seamless system that provides older Australians with more choice and control and easier access to a full range of services where they want it and when they need it. It is seamless, so an older person is not fronting up and being assessed for one thing and then having to go back and be assessed for another thing. It is about being able to access those services without having to go through the barriers and the blocks that are in place at the moment. Older Australians tell me all the time that those barriers and blocks are a problem and something that they would like to see changed, and they are something that this legislation will change.

The package also positions the aged-care system to meet the social and economic challenges of the nation's ageing population. It is delivering better residential aged care; additional support and care to help older Australians to remain living in their home; and additional help for carers to access respite and other support. It is strengthening the aged-care workforce, supporting consumers and research, providing better health connections and tackling the nation's dementia epidemic—and I would just like to say that the Standing Committee on Health and Ageing, which I chair, will be delivering a report on dementia in the very near future. As I have spoken with stakeholders, carers and people that are living with dementia, I have learnt a lot about dementia and the fact that, as a nation, we really need to take it very seriously and address issues surrounding it. That is what this government has done: it has recognised the need for us to put in place a strategy for dealing with dementia.

This legislation is also about supporting older Australians from diverse backgrounds and building an aged-care system for the future. Everything has its time and its place. We need change, and when we have change it should be developed through extensive consultation and in an inclusive way involving all those people that have an interest. The government's aged-care package was substantially informed by the Productivity Commission inquiry into caring for older Australians. There was extensive consultation, as I have already mentioned. The reforms will be implemented in stages, which gives us time to adjust to change. These reforms will ensure that Australia's aged-care system is underpinned by fairer and more sustainable financial arrangements. That is very important, because if you have a system that is unsustainable then those people that need to rely on that system will be hurt.

The reform of Australia's aged-care system is essential if we are to provide our nation's seniors with the care, the security and, above all, the dignity that they deserve. This package will make it easier for older Australians to stay in their homes. We are increasing the home care packages from almost $60,000 to $100,000 and providing tailored care packages for people receiving home care and new funding for dementia care. There are caps to the costs so that full pensioners will pay no more than the basic fees. We will be providing more choice about how people wish to pay for their care. Instead of a bond, which can cost up to $2.6 million and bears no resemblance to the actual cost of accommodation, you will be able to pay through a lump sum or a periodic payment. That, once again, provides flexibility. It is about looking to the needs of the person. It gives families and older Australians time to make a decision about how to pay by introducing a cooling-off period.

For the very first time, we will introduce fairness into the payment system. Right now, pensioners often pay more than people with hundreds of thousands of dollars in assets. This legislation will change that. From now on, the system will be fairer. It will be based on capacity to pay, and the amount you pay for aged-care services will be capped and underpinned by tightening means tests, meaning that older Australians will not be forced into a fire sale of their home. If there is any one issue that I think older Australians are concerned about it is the fact that they will be forced to sell their home. Their home is their castle. It is where their children grew up and it is their connection to their life. Even if they need to live in residential aged care, they all want not to be forced to sell their home. It is very important for older Australians, and the government has recognised this.

There will be increased funding for aged-care workers, and there is also going to be an increased number of residential aged-care places.

That is very important, because, as we have more people becoming older, we are going to need not only more packages but also more residential beds in aged-care facilities, and they need to be quality beds. I acknowledge the role that the member for Mackellar played in improving quality in aged-care facilities. It is very important that we can rely upon the fact that we have quality aged-care facilities. This legislation takes it another step. It will be providing more funding for dementia care and aged care and support for services. It will establish a single gateway to all aged-care services and stricter standards. This legislation has the scope to change the face of aged care and aged-care services, not only for the people providing the services but, most importantly, for the people who are using those services.

From 1 July, there will be a new type of care: home care. Home care will replace community care and some of the other forms of flexible care. There will be four levels of home-care packages covering basic home care all the way through to complex home care. There is an additional dementia supplement and a new veterans' supplement payout to provide for people who care for those living with dementia or people who are veterans. The existing community visitors scheme for people receiving residential care will be extended also to those people who are receiving home care. This will look at addressing the fact that many people who are older are quite often restricted in their ability to get out and about. This is designed to reduce isolation and to keep all our older Australians connected to their community.

From July 2014 there will be changes to the way home-care subsidies and fees are calculated for care recipients. Some people who are receiving care will need to contribute to their costs through income tests. People who receive home care on 30 June 2014 will continue under their current arrangements. People entering the system will come under the new arrangements.

In the time I have available I cannot touch on all aspects of this legislation. It is extensive. It will change the face of aged care and aged-care services within this country. In a society that is ageing you need to have an aged-care system that is fair, equitable and accessible to all. Any aged-care system needs to provide certainty and be designed to meet the needs of older Australians. It needs to be seamless and it needs to be a system that also looks after aged-care providers and workers, because they are pivotal in the provision of a quality aged-care system. The legislation we have before us today does that and should be supported by both sides of this House.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

I rise this afternoon to speak on this cognate debate on the Aged Care (Living Longer Living Better) Bill 2013. I also acknowledge, as the member for Shortland did, the member for Mackellar, who was an aged-care minister in the John Howard government. She did an excellent job and was acknowledged by the other side of the House. I have recently had the member for Mackellar, who is now the shadow minister for seniors, in my constituency. We were certainly welcomed very warmly out there and we certainly saw some of the aged-care challenges that we have in rural communities for what is across Australia an ageing population.

This Aged Care (Living Longer Living Better) Bill 2013 is a package of five bills and does not resolve many of the outstanding viability issues for providers, and I want to touch on a few of those particularly in rural communities.

At this most critical time, as a result of the unprecedented demographic change occurring in Australia, investment in the aged-care sector is imperative. Communities across my electorate want to have an aged-care facility where they can look after their seniors as they grow older and need more care and have to leave home for that care. It becomes a pride of their community. It also keeps their communities together. Because, without that aged-care facility, people have to leave their homes, their communities and their extended families and go to where there is an aged-care facility that can accommodate them.

This original reform package was announced by the government in April of last year, over 12 months ago. Yet it has taken the government a year to bring legislation to this parliament so that the opposition can look at it and see what we can do in relation to this aged-care reform. Now it wants to ram these bills through the House without proper consideration. They have had over 12 months to deal with the reform and yet here we are with just four weeks to run in this House before the House is prorogued and the election is called to deal with one of the most critical issues that this nation has to address—that is: how are we going to fund and support our seniors and people who require aged-care services?

One of the failings in the aged-care reform package that this government is missing is the failure to reduce red tape. This is something that the sector has been urgently requesting from government; to eliminate red tape. The sector is already wallowing in red tape. This package will actually heap more red tape on them, and more bureaucrats to deal with it

After the reviews, inquiries and talkfests, the government has ignored the bulk of the Productivity Commission's report by cherry picking just a few of its recommendations—not all of the recommendations, just a few. This is not real reform. This is another Labor Party smoke-and-mirrors trick.

I know that the member for Mackellar and many on this side of the House—and, I am sure, many on the other side of the House—have had aged-care providers come to them and identify some of the problems that this government has not addressed. And yet what the government is proposing will create more red tape and cost these providers more to deal with the regulation and meet accreditation guidelines and laws. A key issue that has caused major concern with the stakeholders is the decision by this government to rip $1.6 billion out of the ACFI. I guess it is in response to the way the government has mismanaged the economy and mismanaged its budget—so it looks for savings and is going to rip $1.6 billion out of this sector, a vital sector in the Australian community. Another issue is the $1.2 billion workforce supplement. It seems to me and many on this side of the House that the workforce supplement is about the unions, who really at the end of the day are the Labor Party bosses. That $1.2 billion workforce supplement is offered to the sector, but with conditions.

Australia is facing a major challenge with the median age of Australians growing all the time. In fact, in my electorate and in many rural communities it is rapidly increasing, more so than in many of our cities and larger regional centres. In my own electorate the median age is 38.2 years, which is 1.2 years above the national average. The Winton and Barcoo shires in my electorate have recently had some work done by the library to identify some of the issues of demographic change in my electorate. They found that the median age in those two communities is 43 years. In South Burnett, which the member for Mackellar, the shadow minister for seniors, visited with me recently—Kingaroy is the major centre there—the median family age is 42 years, as against the national average of 37 years. Australians are living longer, and that is the challenge. That is why this package of measures is so disappointing, with an opportunity lost to address some of the key concerns of the major stakeholders, the charitable organisations that provide the services and run very successful aged-care facilities. The government just has not listened to the message that is coming from our aged-care sector.

As I said a moment ago, a few weeks ago I visited Goondiwindi with the member for Mackellar. We visited the Kaloma Home for the Aged at Goondiwindi. It is privately owned and run by the community, and it is the pride and joy of the community. Over many years they have built on from the reforms that were introduced by the member for Mackellar when the coalition was in government, which were acknowledged while we were there. It is a magnificent facility. But they tell me this new package of measures in this bill is causing them major concerns and cost blowouts. An issue they raised with me was their significant concern with regard to the workforce supplement. They will miss out on the accommodation supplement despite having completed significant building developments and upgrades supported by the residential ratios. A number of the substantive concepts relevant to accommodation payments in the Living Longer Living Better reform package are contrary to the market driven model proposed by the Productivity Commission and, as Kaloma says, without significant amendment will deter future investment in this sector. That is the very opposite of what we should be aiming to achieve: to encourage more development of aged-care facilities. Because the government has not picked up on the recommendations of the Productivity Commission this package will deter future investment in this sector.

The provisions that introduce controls for setting accommodation payments should be removed and replaced with a market-driven model where the providers set a price, as proposed by the Productivity Commission. The board of management of the Kaloma Home for the Aged at Goondiwindi support that. That is what they would like to see. The government's aged-care reforms require that accommodation supplements will be reduced by 25 per cent where facilities have fewer than 40 per cent financially disadvantaged people in occupancy. So what they are saying is supplements will be reduced by 25 per cent if they do not have 40 per cent of financially disadvantaged people in occupancy. In a sector that is dominated by religious and charitable organisations, the government really does need to only provide a reasonable accommodation supplement to promote investment that goes to support the financially disadvantaged who, when they do need an aged care facility, are going to be looking to the charitable organisations who run these facilities to support their needs.

The other thing I have found in many parts of my electorate is multipurpose health services. These are an excellent response. They are funded by the Commonwealth, and I acknowledge that, where the multipurpose health service is attached to the local hospital. But what it also identifies is that it enables communities that have a hospital, after consultation with the community, to provide some aged-care beds, particularly high-level care, for those communities where otherwise those people would have to leave that community. It is an excellent way to provide that very much needed service to those communities.

I have a number of them. I have been to a number of the consultative meetings. Only last week I was down at Surat, south of my home town of Roma, with the Queensland Minister for Health, Lawrence Springborg, opening the new multipurpose health service in Surat. It is a wonderful facility, purpose-built, added on to the hospital and one of the facilities there that enables the community to stay together rather than those people leaving Surat. It certainly supports families and extended families. I think there are six beds there, but it is not like a hospital environment; it is more like a home. It is a wonderful facility and I congratulate the design engineers and the Commonwealth for that matter, who have provided the funding which will be administered and run by Queensland Health because it is a Queensland Health hospital.

The other one, which is under construction at the moment, is at Injune. It underpins what I have been saying about providing services to our smaller rural communities. There is a hospital there and they had an aged-care facility: Mount Hutton. It was about 10 rooms and it was run by the Churches of Christ. But what they were finding with all the regulations they have is that basically it was becoming unviable, and they wanted to hand it back to the community. The community were unable to run it; it does require the knowledge of charitable organisations that have been running—and do successfully run—many in my electorate.

We went through a very difficult period, because it looked like there would be no aged-care facility in the town of Injune. It would shut: a wonderful facility, built by the community with money saved by the community. That is what underpinned a lot of our aged-care facilities in the past in many of our communities. It was money raised by the local community to build the aged-care facilities that look after the people as they aged in their towns. They recognise, as I do, that it is so important to keep families together in these smaller communities. Otherwise, it sees the deterioration of help for many and the dislocation of family life, if you are not able to keep communities together.

Luckily, we have been able to negotiate, through Queensland Health and the Commonwealth government, a facility where we could expand the hospital to include a multipurpose health service. This is now under construction. I am certainly looking forward to when it is completed and to attending the opening there, because I know what it means to the community of Injune and the surrounding district. I know it will be of the standard that we opened recently in Surat.

Similarly in Mitchell, just west of my home town, we are going to establish, through the Commonwealth funding as well as with Queensland Health, a multipurpose health service attached to the hospital. When they are attached to the hospital it means that the laundry, the cooking and the registered nurses are there and available all the time, 24 hours, seven days a week, to meet the needs of those who are residents in the aged-care section of the mulitpurpose health service.

I am very disappointed that this government has failed to pick up completely the recommendation from the Productivity Commission. The aged-care providers that I talk to are still very concerned that this is going to add more costs, more red tape and will make it even more challenging to keep many of these operations in rural communities viable. (Time expired)

Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Aged Care (Living Longer Living Better) Bill 2013, the Australian Aged Care Quality Agency Bill 2013 and associated bills.

The ageing of our population is the biggest social issue facing Australia. We are a rapidly ageing population, acquiring more complex health conditions with changing disease patterns. This social issue is, of course, also a budget issue; an ageing population means fewer people will be generating taxation revenue. The dependency ratio in 2007 was six people of working age for every person aged over 67. By 2047, this will be almost halved to approximately 3.2 people of working age for each person aged over 67. By 2050, over 3½ million Australians are expected to use aged-care services each year.

With greater numbers using aged-care services, there will be greater demands on those services. There will be increased numbers of Australians with dementia requiring these services and the average age of a home-care recipient, which currently stands at 82-years of age, will continue to increase.

As we move from the baby-boomer generation to the next, users of aged-care services will no longer meekly accept what they are given, as many learned to do during the tough economic times of the last century. It is therefore integral to the future care of older Australians that we implement policies which give clients and their families the ability to choose their own provider to deliver government-funded services.

This highlights the fundamental importance of implementing real reform in the aged-care sector. However, the five bills today continue the piecemeal approach from this government rather than a genuine attempt at reforming the sector. They are a response from the Labor government, announced in April 2012, to the Productivity Commission's August 2011, Caring for older Australians report. In many ways, these long-awaited changes are simply too little too late from a government that has ignored the aged-care sector since being elected in 2007.

They have undertaken a litany of reports and reviews—20 reviews and three Productivity Commission reports in total—and have then chosen to ignore the outcomes of these processes, instead, responding with more inquiries without making any real decisions to secure the future of the sector.

Unfortunately, today's measures do not embrace the opportunity for real reform. This Labor government has cherry picked a few recommendations from the Productivity Commission report. Industry sources estimate that about five to eight per cent of its recommendations have actually been adopted from the Productivity Commission's extensive and comprehensive report, which initially received more than 500 submissions with a further 500-plus following the release of the draft report.

After five years of neglect, our aged-care system needs urgent change to provide viable and effective services for older Australians. Instead, year after year, this government has committed itself to taking money out of the aged-care sector. Last year, Labor cut $1.6 billion from the aged-care funding instrument 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 there was widespread rorting by aged-care providers, although I note there has not been a single prosecution in five years.

As it often does, whether it is 457 skilled migration visas or our national sporting codes, this government makes public allegations that taint an entire sector without providing any evidence for their claims. Furthermore, according to the Grant Thornton report released in June 2012, after the Labor government announced the Living Longer Living Better package, more than $3½ billion in planned aged-care development projects have been shelved. The organisation Leading Age Services Australia also revealed in August 2012 that their industry faces a blackhole of more than $750 million over the next 2½ years.

Aged and Community Services Australia have also reported on the dire situation of the sector. In their 2011-12 budget submission, they reported:

A snapshot of the industry does not depict a sustainable system: that only 40% of aged care providers are operating in the black: hours of service are decreasing; hours of care provided under community aged care packages have fallen; and many providers are not building new residential care beds. The situation is worse in rural and regional areas where providers face higher costs with less ability to manage their income streams.

That is the evidence on the ground. The aged sector industry is suffering. As a result of this Labor government's decisions to cut funding to the sector, providers are facing a huge task in even remaining viable, which will, in turn, have huge impacts on Australians who need their services as well as those employed in the sector.

When speaking to aged-care providers in my electorate, they have told me that they do not disagree with the general direction of the key points of the package, but they want further detail. They are waiting on the detail about what the impact of the regulations placed on providers and consumers will mean for aged-care services. One of the most important areas on which this parliament must focus is implementing real reform to improve customer directed care. This means providing real change. The ability to decide who delivers services should be placed squarely in the hands of the consumer without the very onerous red tape and caveats that currently exist in the sector, not to mention the micromanagement of providers by the Department of Health and Ageing. If we are not able to get this right, if we are not able to genuinely improve this sector, then we undermine the entire philosophy of consumer directed care.

Users of aged-care services must be provided with all the relevant information about what services would be appropriate for them, and not just advising which aged-care organisation has been approved through the government's tendering process. This means moving away from the Canberra based bureaucratic tendering nightmare, which by its very nature will favour those already well embedded within the system. There are a lot of details to cover in these bills, which is why they were referred to the Senate community affairs committee. The committee was due to deliver its final report on 17 June 2013, but has recently ceded to the demands of the government that the parliament consider these bills without full knowledge of their ramifications and will report instead on 31 May—a change the coalition senators strongly oppose.

I am concerned that, without following the appropriate parliamentary processes, all stakeholders in the industry will not have the opportunity to make meaningful submissions on the detail of the bills and their instruments. As Leading Age Services Australia has indicated, they believe that, considering the level of detail and complexity contained in the instruments, it is essential that proper parliamentary processes be adopted. Furthermore, the opportunity to comment on the consultation draft documents for the Home Care Packages Program guidelines has not yet closed, and I expect that providers will have a great deal to say on the direction of those draft guidelines.

Ultimately, the actual details of the bills mean more bureaucracy and more regulation in what is already a highly regulated sector. The Aged Care (Living Longer Living Better) Bill 2012 implements changes in four key areas, including: changes to residential care; changes to establish a new type of care—home care; changes relating to governance and administration; and further minor administrative or consequential changes. The Australian Aged Care Quality Agency Bill 2013 establishes a new agency to replace the existing Aged Care Standards and Accreditation Agency from 1 January 2014, as prescribed under the Financial Management and Accountability Act 1997. The new agency will be responsible for approved providers of home and residential care to deal with quality assurance of their services. There will also be other new bodies, including the aged-care pricing commissioner, which will be yet another layer of regulation on pricing and will place further burdens on providers and consumers. There will be some changes to home care, including replacing community care and some forms of flexible care delivered in a person's home, such as Extended Aged Care at Home and Extended Aged Care at Home Dementia.

From July 2014, there will be changes to the way that homecare subsidy and fees are calculated for care recipients who enter home care on or after 1 July 2014. Key changes will include requiring some care recipients to contribute more to the cost of their care through an income tested care fee, that no full rate pensioner will pay an income tested care fee and that new annual and lifetime caps will apply to income tested care fees. In the changes to residential care, the government has proposed that care recipients who can afford to can contribute to their accommodation costs through a fully refundable lump sum, a rental style periodic payment, or a combination of both. The periodic daily accommodation payment is the implied preference of the government, despite the evidence given during the Senate committee's inquiry that the lump sum option provides greater stability to the sector.

Furthermore, the minister has also announced a $1.2 billion workforce supplement, which imposes further regulation and red tape on providers. Minister Butler first intended to negotiate a workforce compact with both unions and employees with consultation and the support of aged-care providers. That did not happen, because providers were forced to boycott the process when they discovered that the true intention of the minister was to increase union membership without any real attempt to actually improve services in the industry. Such was the level of disgust by the providers at this abuse of process that the minister could not even find one aged-care facility to host his announcement.

Under the proposed workforce compact, providers with more than 50 beds will have to enter into an enterprise bargaining agreement and meet certain so-called workforce obligations to access funding under the compact. Providers with less than 50 beds would be required to meet the workforce obligations but will not be required to enter into an EBA to access the funding.

However, there is no guarantee that this supposed increase will actually reach workers. The minister has previously admitted that he does not know how many of the nation's 350,000 aged-care workers will benefit. What we do know is that with only 40 per cent of providers operating in the black, many of them will simply be unable to pay the wage increases and the associated ongoing costs such as in administration and superannuation. The cost pressures will further erode their viability, especially for smaller providers in rural and regional areas, as identified by the previous speaker, the member for Maranoa.

Forcing providers to enter into EBAs mean that more aged-care workers will be forced to join a union. Unfortunately, they do not have much to choose from: there is United Voice, the Australian Nursing Federation and, of course, the notorious Health Services Union. United Voice, Minister Butler's former union, has recently put out a publication, using this new workforce compact as a call to arms for workers to join the union. It states:

Most employees on award wages need to negotiate an Enterprise Agreement to get the pay rise. To win a good agreement, all potential members are urged to join United Voice to speak with one voice in negotiations.

This compact—negotiated only with unions, not providers—is a backdoor way to coerce more aged-care workers to join a union, including the HSU. It is an industrial mechanism to unionise the sector dressed up as an administrative change.

The coalition have a real plan to take real action for older Australians and the aged-care sector. We will provide certainty of care through the first ever four-year aged-care provider agreement with the aged-care sector. We will establish an aged-care bed incentive program to provide $335 million over four years to convert up to 3,000 of the allocated bed licences to operational residential aged-care beds in the first term. We will provide convalescent care to assist up to 20,000 older people waiting in hospital to return home. We will ensure a high standard of quality care and less red tape, and we will support the continuing contribution of senior Australians through dementia programs and other community based programs.

Given the increasing difficulties the industry faces, we simply cannot continue with piecemeal approaches to the aged-care sector. We simply cannot allow this Labor government to rush incomplete legislation through the parliament without giving all relevant stakeholders the opportunity to have their say. Today's measures will only add further regulation to an already highly regulated sector.

On Tuesday night we listened to yet another deficit ridden budget speech from the member for Lilley. The Treasurer spoke—at length—about his 'Budget for the Future'. But nowhere did he mention the future of aged care; nowhere did he mention the future of older Australians. Australia needs a government willing to listen and a government with the determination to invest in genuine reforms for the aged-care sector for the benefit of providers and consumers. The coalition has been listening, and will continue to listen. Only the coalition will restore hope, reward and opportunity and give a real future for older Australians who deserve our support. I would also take this opportunity to remind the chamber that next week is National Palliative Care Week and I hope that everyone will promote that very important event in their own electorates.

Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Local Government) Share this | Link to this | Hansard source

I am pleased to speak on the Aged Care (Living Longer Living Better) Bill 2013 in the cognate debate with the other bills that have been described by previous members. I wish to briefly outline why we are here, the history of why we need to be here and then explain why this bill is relevant to my electorate of Canning.

We know that these bills are the legislative response to the government's aged-care reform package announced in April 2012 which, as I said, has been called Living Longer Living Better. The Aged Care (Living Longer Living Better) Bill 2013 seeks to remove the distinction between low-level and high-level residential care so there will only be one approval process. It provides a new means test combining income and assets tests, new annual and lifetime caps on means-tested aged care. It will allow accommodation costs to be paid through a refundable lump sum, a rental style periodic supplement or a combination of both. It will make changes to Home Care, including requiring a contribution for people that enter a home for care on or after 1 July 2014. It will establish a new aged-care pricing commissioner. It will extend the operation of the Accommodation Bonds Guarantee Scheme to new bond arrangements reflected in the government's reforms. It will establish the new Australian Aged Care Quality Agency to replace the Aged Care Standards and Accreditation Agency from 1 July 2014.

Why we are here is because in 2010 at the election Prime Minister Gillard said aged care would be a second term priority. We have seen the government undertake report after report and review after review, including 20 reviews and three Productivity Commission reports. If you remember, they did three reports here but they would not do one on the NBN. The Productivity Commission's Caring for older Australians report was publicly released by Prime Minister Gillard and Minister Butler on 8 August 2011. Instead of responding in any meaningful or quick way, Minister Butler embarked on more talking. He called it a national conversation but it was simply a talkfest. At their news conference, the Prime Minister did not respond to any of the 58 recommendations in this report. Finally, almost two-thirds of a year later—256 days later—on 20 April 2012 the Gillard government announced its Living Longer Living Better aged-care reform package in response to the Productivity Commission report. But this legislation which we are dealing with today cherry-picked a few of the recommendations made by the Productivity Commission.

We have some issues with this legislation. With this Living Longer Living Better announcement, whilst the headline figure of $3.7 billion over four years sounded impressive, the actual amount of new money—and I stress 'new money'—to be spent was only $577 million; in other words just over half a billion dollars over that four-year period. It is interesting, isn't it? The government—as we heard in the budget on Tuesday night—can come up with something like $5 billion as a knee-jerk reaction to illegal arrivals in this country, yet only half a billion dollars for the aged-care sector.

The so-called 'new' spending is a combination of means testing and simply cutting funding from one area and redirecting it to another—in other words, re-announcing it. It is worth noting that with this legislation many of the changes will not start, as I have already said several times, until 1 July 2014, well after the coming election, and it will be interesting to see whether Mr Butler gets an opportunity to have any say in its implementation.

There is no doubt that the aged-care system needs urgent change. The ageing of our population is one of the biggest social issues that we face as a country. We have an ageing population that is obviously living longer. 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 20 per cent by 2051. In the electorate of Canning, 10 per cent of the electorate's population is over 70 years of age according to the latest census data. That is why we need proper structural reform of the aged-care sector so that the care and wellbeing of our older Australians are properly managed and care providers can remain viable.

Unfortunately, this package of five bills does not resolve many of the outstanding viability issues for providers. The $1.6 billion cut to the aged-care funding instrument, ACFI, has caused great angst amongst care providers and has placed them under substantially more pressure. The ACFI changes were supposedly made because of spurious assertions of provider rorting. As the member for Ryan and others have made clear, despite these claims made by the minister of unusual claiming at estimates in February 2013, it was revealed that there have been no prosecutions in at least five years. So if there is an allegation, where is the follow-up? There is none. The minister said he would investigate these serious allegations, yet there has not been any report to date, and with four weeks of sitting left for this parliament, I suspect there will not be any.

In addition, this legislation will add even more regulation and more red tape to the already highly regulated sector. This is one of the things that makes it not only costly but also very, very difficult for them to do their job, the fundamental job that the providers are there for and that is to give quality aged care.

One dubious aspect of the legislation is that it seeks to establish the framework for the workforce compact, which will be potentially costly for providers and appears to be a mechanism to unionise the sector—and this has been spoken about by other speakers as well. The $1.6 billion cut to the ACFI will be used to finance the $1.2 billion workforce compact component—notice the $400,000 shortfall. Under the $1.2 billion workforce compact, providers with 50 or more beds need to enter into an enterprise bargaining agreement, in other words, an EBA to access this funding. Isn't it funny? It sounds like the 'no ticket no start' is out there again but this time in the aged-care sector. Providers with fewer than 50 beds need not enter into an EBA but must comply with the conditions of the compact to access funding. So if an employer meets the terms and conditions of the workforce compact, the aged-care workforce supplement will be paid. In other words: sign up or you will not get the money; join a union or you will not get the money.

The member for Ryan also pointed out the choices you have, one of them being the Health Services Union, the so-called discredited union that took the lowest-paid workers' fees and splurged them on themselves. We will not go into that now, but I think that it is one of the reasons that union is losing members.

If you are being paid award wages to get the workforce supplement, the employer will have to increase your pay by at least 5.2 per cent this coming financial year. If you are being paid according to an EBA, being paid at least 1.5 per cent above award wages to get the workforce supplement, your employer must increase your pay by at least 3.75 per cent this financial year. Trudi Hodges, the CEO of Dale Cottages—a residential accommodation centre in Armadale in my electorate—is rightly concerned about these wage increases as it affects their ability to pay their workers and attract staff.

No-one is saying that the wage increase is not a good thing. The Howard government oversaw real wage increases of more than 20 per cent during the term of that government. But rises in wages need to be affordable and sustainable. With only 40 per cent of residential aged-care providers operating in the black, they are rightly concerned. Eighty-nine per cent of the aged-care providers will suffer irrecoverable losses of revenue under the ACFI changes from 1 July as they already stand. The average loss per aged-care facility is more than $125,000 each year with some facing revenue shortfalls up to $560,000, with smaller and rural facilities most affected.

For example, again in my electorate, Irene Mooney, the CEO of Quambie Park, a small provider in the rural location of Waroona, also has grave concerns about this legislation. The feedback she has provided to me comes from a group of age-care providers known as the Small Providers Group. This is a group supported by Aged Care Services of Western Australia, one of WA's aged-care peak bodies. The feedback from this body of small providers says:

Indexation needs to be locked into subsidy payments on an annual basis (same as the current indexation application to basic daily care fees) for both Aged Care Funding Instruments (ACFI) and Community Care subsidies.

Time does not permit me to go into all of the ramifications of the recommendations but, briefly, the current costs of capital development and construction and refurbishment are not viably supported by the current supplement payment. Occupancy in rural and remote areas when a vacancy arises may take a period of time to fill and the geographical area et cetera affects a whole range of occupancy issues. Activity costs for these small providers are also an issue. The workforce compact in its current form is telling aged-care providers what they need to do in terms of their staff, yet it does not allow them to cover extra moneys.

I know how this local provider feels because, unlike the Labor government, the coalition is interested in working with providers for the best possible outcomes. She knows what the problem is and this coalition knows how they feel.

Aged and Community Services Western Australia, ACSWA, has made a submission to the Senate inquiry highlighting its serious concerns about the workforce supplement, particularly its impact on smaller regional, rural and remote aged-care providers. ACSWA has provided us with an example:

An aged care provider who operates a small 31-bed RRR 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 wage supplementation support (that is, $47,000 in total). This amount additionally does not include on-costs for the provider which must also be absorbed.

In addition to the points mentioned above, one major area in aged-care reform that has been overlooked is a commitment to reduce the administrative burden that continues to hamper this sector. The coalition has been advised that aged-care nurses spend an average of a third of their time on paperwork, which takes them away from their caring duties. Under the Labor government proposals this can only get worse. The government's establishment of the Aged Care Funding Authority creates another bureaucracy—surprise, surprise—based in Canberra and trying to deal with people 3,000 kilometres away.

In contrast to the Labor government, the coalition wants to work in partnership with the aged-care sector to achieve real and sustainable reform through our first-ever four-year aged-care provider agreement. This will provide certainty for the aged-care industry and there has been a positive response to this aspect of certainty. This high-level interaction and level of certainty have been absent in recent years under the Labor administration. For example, the recent debacle with the ACFI cuts would not have happened if a four-year agreement had been in place.

While we will revise our policy closer to the election, the fundamental framework of the first-ever aged-care provider agreement will be retained. This agreement will deliver better and more affordable aged care because the crux of what we intend to do is: reduce red tape to enable nurses to get back to nursing residents; provide certainty, underpinned by a high-quality framework; deliver value for money through revised subsidy arrangements; ensure certainty for the aged-care workforce; establish a more flexible and viable aged-care provider network to meet care needs now and into the future; and ensure that the comfort and safety of older Australians are maximised.

The coalition wants this agreement to be in place within a year of taking office. As part of the process the coalition will establish a high-level aged-care provider agreement steering committee of key stakeholders to oversee the administration and implementation of the agreement and provide advice to the minister. In addition we will establish an aged-care provider arrangement working group, which will undertake the detailed design and project work required to give effect to the agreement. These measures will provide a formal pathway for a dialogue between the minister, the government and the stakeholders.

I cannot stress enough how the coalition values the input from the industry, who are the real experts in this area. The discussions with aged-care providers in my electorate have been invaluable. People like Trudi Hodges, the providers in Waroona and those right throughout the electorate are gravely concerned about funding going forward. At the moment it is very difficult for a provider to establish a business case. In fact, people are giving back their bed supplements and licences because they are unable to build a business case. While this is happening it takes away the opportunity for our frail and very aged Australians to seek quality aged care in this area. They deserve better. Should we be the government after 14 September we will provide that. This legislation does not provide that; it provides greater bureaucracy.

Debate adjourned.