The aged care sector will benefit from a strengthened framework to deliver greater transparency and accountability of the financial and tax practices of for-profit providers, a senate inquiry has found.
The Senate Economics References Committee tabled its final report last night from its inquiry into the financial and tax practices of for-profit aged care providers, which commenced in May (read our backgrounder here).
The inquiry was proposed by Australian Labor Party Senator Jenny McAllister in response to the Tax Justice Network – Australia report which suggested for-profit providers were hiding profits to minimise tax.
For-profit providers named in the TJN report, Tax Avoidance by For-Profit Aged Care Companies: Profit Shifting on Public Funds, defended their financial practices in their submissions to the inquiry.
The Senate’s report made five recommendations in response to its investigation into how for-profit providers were spending public money and whether the financial practices of for-profit providers were impacting service quality.
It recommends that the:
- Royal Commission into Aged Care Quality and Safety consider the tax and financial structures of providers
- Australian Government explore opportunities to improve access of information on quality care and aim to increase transparency and comparability of providers to support consumers in better decision-making
- Australian Accounting Standards Board implement necessary changes to apply International Accounting Standards Board’s revised conceptual framework
- Australian Government investigate options to increase public transparency of provider’s financial information held by the Department of Health
- Australian Government convert existing the voluntary tax transparency code to a mandatory code for all medium and large corporations and adopt other strong transparency measures.
The report said the method used to address these concerns must also “capture any forms of serious illegal behaviour, not just corporate tax avoidance in isolation.”
Lack of accountability
The NSW Nurses and Midwives’ Association conducted an audit in the NSW federal electorate of Dobell on Monday night prior to release of the Senate’s report and found “shocking understaffing and associated neglect.”
Nine for-profit aged care facilities were visited and averaged one registered nurse to 85 residents on night shift. The “poorest ratio” was one registered nurse to 138 residents, the NSW Nurses and Midwives’ Association said.
The NSW Nurses and Midwives’ Association general secretary Brett Holmes said there were currently unsafe working conditions in aged care facilities and a lack of accountability among for-profit providers to deliver quality care.
“These companies are making hundreds of millions of dollars in annual profits, receiving billions in public funding and still, there are no measures in place to ensure public accountability and transparency when it comes to safe staffing,” Mr Holmes said.
“This public money must be tied to care and the best way to do that is through mandated staffing ratios,” he said.
Mr Holmes said the audit conducted on NSW’s Central Coast reflected staffing issues across the state.
“The federal government must start putting measures in place to demand full disclosure and transparency. Without it, we are failing our elderly and allowing misuse of tax payers’ money,” Mr Holmes said.
Access the inquiry’s Financial and tax practices of for-profit aged care providers report here.
See related coverage: Inquiry told sustainability of aged care sector vulnerable under current funding system
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