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Rebekha Sharkie MP during a press conference in Canberra . Photo : AAP / Mick Tsikas
Show us the money
New bill aims to force providers to be honest about financials .
By Conor Burke
A new bill put to the federal parliament would drastically change the way aged care providers have to disclose information about how they run their businesses .
Federal Member for Mayo Rebekha Sharkie has introduced a private members bill that , if passed by parliament , would require aged care providers to disclose their income , costs of food and medication , staff and staff training , accommodation , administration and monies paid to parent bodies in annual financial transparency reports to the Aged Care Quality and Safety Commissioner .
“ In my time in office , I have been approached numerous times by constituents deeply worried about the quality of the food served to their loved ones and the number of staff available to help with feeding and hygiene ,” Sharkie said .
“ This legislation will enable families of loved ones , stakeholders and the public to have a clear view , for the first time , on the proportion of income that providers actually spend on costs of care and how much is just being pocketed or wasted .”
Transparency in the aged care system has been discussed throughout the duration of the royal commission , with critics wanting to know where government funding of aged care goes every year .
Research Paper 12 from the commission titled : “ Report on the profitability and viability of the Australian aged care industry ”, and undertaken by global professional services firm BDO , said that transparency was insufficient and found large differences in the way in which individual aged care providers structure their operations and the costs they incur such as interest , management fees and rent .
BDO found 74 per cent of aged care providers were profitable , 13 per cent were unprofitable , 4 per cent were unprofitable but had positive cash flows and 9 per cent had the inverse .
Overall , just over half ( 53 per cent ) of aged care providers were ‘ viable ’, while 8 per cent were ‘ not viable ’. The remainder fit into neither category because their viability hinged on them being able to secure additional capital .
In the recent hearing of the commission , counsels assisting put forth 124 recommendations for changes to the aged care system recommended .
Recommendation 100 – Prudential regulation by the Australian Aged Care Commission – suggests that a newly formed “ Australian Aged Care Commission should be given the statutory role as the prudential regulator for aged care with responsibility for ensuring that … providers of aged care have the ongoing financial capacity to deliver high quality care ” and “ The Presiding Commissioner shall allocate the responsibilities associated with prudential oversight and the establishment of an effective financial reporting framework to an Assistant Commissioner ”. A similar attempt to force providers to be more open was knocked back earlier in the year .
In June 2020 , South Australian Centre Alliance senator Stirling Griff introduced a similar bill to the Senate that would change the Corporations Act 2001 and force residential aged care providers to include “ detailed financial information in their annual financial statements ”.
However , the Liberal government and One Nation joined forces to block the bill .
Sharkie says that Australia cannot wait for the final royal commission report and must take action to fix the system now , and her bill is a start .
“ Estia Health , Japara and Regis Healthcare are all residential aged care providers , and all ASX listed companies .
“ According to recent investigations conducted by The Saturday Paper , the trio have received a combined $ 8.4 billion in revenue from Government subsidies and resident charges in just the last five years alone .
“ At the same time , these three companies have paid out $ 600 million to shareholders .
“ We ’ ve heard allegations of directors of aged care companies who have had the ability to use their funds to buy luxury cars .
“ There ’ s money in offshore bank accounts . We hear allegations of where rent is more than double the commercial rate , with money being funnelled back into church coffers .
“ My Bill simply seeks information from providers so the Government , and the public , will have a clearer picture of how facilities are resourced .
“ This will be crucial if we as a Parliament are to engage in sustainable reforms to the sector that will improve the experience and treatment of vulnerable elderly people living in residential aged care .” ■
4 agedcareinsite . com . au