Reform package falls short

Now that the dust has just started to settle, aged care reform advocates are starting to question whether the government’s recently announced reform package actually went far enough.

By Yasmin Noone

The federal government has fallen short in providing the aged care sector with the reform package it needed and was promised, although what was announced pre-budget is good enough for now.

This is the overall feeling of many aged care stakeholders and reform campaigners in the aftermath of the now historic ‘20th April 2012’ aged care reform announcement made jointly by Prime Minister, Julia Gillard, and the Minister for Mental Health and Ageing, Mark Butler, more than two weeks before the full 2012/13 budget was released. 

Although many welcomed the reform announcement on the day it was made, as the dust now settles, advocates are examining the package’s finer details and saying that more money and additional measures would have been appreciated.

CEO of Catholic Health Australia, Martin Laverty, said the reform package is a good start but did not go far enough.

“The PM spoke of the importance of Medicare being universally accessible to all Australians,” Mr Laverty said. 

“She wanted, as part of a great Labor tradition, to enable an entitlement to aged care services, just like Medicare.

“She fell short of doing that. These reforms haven’t removed the rationed allocation of aged care places which is what the Productivity Commission (PC) recommended, the National Aged Care Alliance (NACA) supported and what older Australians would think is already in place.

“So we’ve said to all members of the parliament that, just as the Coalition and government have agreed to support the establishment of the National Disability Insurance Scheme (NDIS) arrangement, so too should there be the support of the full parliament in delivering aged care as an entitlement.”

Mr Laverty also asked the Gillard government: “Why would you commission the PC to do a blueprint if you didn’t intend to implement it? The government and the Opposition have stood behind the NDIS. Why should aged care be any different?”

Although the official reform announcement highlighted the government’s Living Longer Living Better plan was worth about $3.7 billion, Mr Laverty commented that most of it is not new money.

“There’s only an average each year for the next five years of $115 million of new money for aged care, on top of an average $11 billion outlay. So that’s less than a one per cent increase on average [in funding] over the next five years. That’s not a substantial amount of money and it doesn’t stretch far.”

He admitted the package intentionally provides room to move for future reform but “we would have preferred an ‘in-principle’ plan [calling for the entire PC inquiry results to be implemented] because governments change and ministers come and go, and it’s not easy to maintain the momentum of [meaningful change] over many years of reform.

“The greatest risk is that other issues, entirely unrelated to the aged care portfolio, will crowd out the prospect of genuine reform in five years time.”

Shadow Minister for Ageing, Senator Concetta Fierravanti-Wells, confirmed that only a small portion of the total monetary package announced in late-April is actually new money.

“Like with so many major Labor policy announcements the devil is in the detail. Of the $3.7 billion announced last week less than $580 million is actually new money – and that is over a five year period, with only $55 million of new money for the 2012-2013 financial years,” Senator Fierravanti-Wells said.

“The bulk of the funding is basically a mix of redirected funds and yet more means testing.

“The Coalition is also a little cynical that the government chose to start its new means testing arrangements on 1st of July 2014 – well after the next Federal election. Presumably, this is to defer the impact of yet more costs increases prior to an election.”

Despite the negatives however, Mr Laverty stressed that the government should be commended for actually moving on reform and delivering a wide-ranging package of various initiatives. 

“The government deserves credit because, for the first time since 1997, a government has bought a set of serious and considered changes for aged care that will deliver easier access into services via the proposed seniors gateway; allow more people to be cared for at home; and increase the sustainability of residential providers by taking daily residential supplement up from $32 to $52 per day. That should all be applauded.

“But that’s only a handful of suggestions that the PC made.

“We are advocating for the implementation of the PCs reform recommendations and to that extent, the government’s announcements have not lived up to that expectation that the government was encouraging us to believe as being a reasonable outcome.”

Prior to the aged care announcement more than a week ago, NACA representatives urged the government not to ‘cherry pick’ bits and pieces of the PC’s inquiry report.

CEO of COTA Australia and fellow spokesperson for NACA, Ian Yates, said that even though the government has fallen short of fully implementing the PC’s recommendations, it – thankfully – did not ‘cherry pick’.

“Cherry picking means that you take a few things and end up with a shemozzle,” Mr Yates said. “These reforms are still systemic but they haven’t gone far enough.

“I don’t see that the government has closed the door on it.

“You can look at this package through dark coloured glasses or through rose coloured glasses or, what we are doing, through ordinary glasses.

“…I think we made it clear on the day of the launch that we welcomed the government’s initiatives. There are lot of initiatives – some bigger, some smaller.

“Most of them are steps in the right direction. We did name clearly disappointed that the government didn’t go further on entitlements. But now the minister has made it clear that that is an issue for a five-year review.

“In terms of dollars, we would have liked to see more dollars but that comes budget by budget, as every budget is not just about the budget but the forward estimates.”

Happy all round

CEO of National Seniors Australia, Michael O’Neill, said he strongly believed the reform package did not fall short of what was expected. In fact, he added, the government did well to deliver a package that pleased most and struck an ideal balance between what was needed, what was requested and what was feasible to deliver.

“It would have been absurd to simply endorse what the PC has proposed,” Mr O’Neill said.
“And it’s entirely appropriate for the government to make a decision about the nature of reform” based on what it thinks – not what the PC thinks – is suitable for the country and for Treasury. Anyone that thinks differently is in dreamland.

“…There was never going to be a magic bullet to keep everyone happy, immediately.

“We remain positive that the package has a good mix of reforms that has certainly provided for and recognised the consumer side of the equation, far more than was previously the case.

“The package places an emphasis on people remaining in their own homes which is long overdue. And it does provide for a very substantial reform process over the next couple of years.”

NACA member and assistant national secretary of United Voice, Sue Lines, said it was satisfied with the workforce focus of the package although agreed that a bigger cash injection would have been more welcomed. 

“We are still happy overall as the workforce compact we put forward is the one in the package,” Ms Lines said. “The basic fundamentals have been accepted by government and that’s positive.

“Obviously, we would have liked more money…but it’s a start.

“It seemed that one of the things that employer’s wanted was a free market system but underpinned by the government. I don’t really think you can have both.

“The government is not saying aged care [reform] is done and dusted – it may require some additional tweaking.

“It’s a good start and nearly all of us got a bit of what we wanted. In an ideal world, we’d get everything we want. But that’s not what we live in.”

Ms Lines the union’s support of the government does not mean it will back away from its claim that aged care workers should be paid a fair and just wage. But hopefully the Workforce Compact will be an effective stepping stone to achieving that.

Tags: blueprint, catholic-health-australia, cha, coalition, cota, gillard-laverty, greens, living-longer-living-better, mark-butler, mental-health-and-ageing, naca, national-seniors, ndis, opposition, productivity-commission, sue-lines, united-voice,

3 thoughts on “Reform package falls short

  1. Everyone should know by now that this Gov’t never delivers on what is actually needed, but creates an illusion that they have excelled. Its all done with the smoke & mirrors of the spin doctors weaving their craft. Clearly, the new money allocated each year is barely going to keep up with the demand of the ageing population, yet some have become exuberantly excited about the package which falls way short of the PC’s recommendations and community needs. The fact that we are not going to see much change at all before 2014 is disappointing and not surprising.
    Don’t put away your campaign gear yet, it’s going to be needed still

  2. Hi,

    What we get wrong is that we think ‘aged care is an entitlement’, why?

    Is car hire an entitlement, travel or accommodation or food or clothes?

    Care for the elderly is the responsibility of the family, with government assistance, not full subsidy. The provider, provides a commercial service which has a cost. The cost is real and needs to be met. It is up to the consumer, not the provider, to get the government to pay more,otherwise the consumer pays more.

    Witholding funding does not reduce the cost – simple but true!!!

    David Powis

  3. If you divide the $55m Senator Fierravanti-Wells mentions by 225,000 people receiving care then the the government is contributing less than 70 cents per day more to care. Big call by Mr O’Neill to imply that elements of the PC proposals were absurd. A successor government will probably have to revisit reform and unlock the value of equity in the home (it is not a ‘family’ home by the way)to have a sustainable system in place that might be needed to provide a bed for Mr O’Neill (or less fortunate friends).

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