Workforce Compact: Australia’s reaction

AAA retreats to new and old methods of measuring public and sector opinion of the recently announced Workforce Compact. Read what has been said on and off the Twitter-feed.

By Yasmin Noone

There’s one way to gauge public opinion on a matter and that’s to go on Twitter to find out what aged care advocates saying. The bulk of the Twitter comments below from politicians, concerned members of the public and key stakeholders were made online on Tuesday, 5 March, the day of the Workforce Compact announcement.

5 March:

FatherBob ‏@FatherBob
Now I’ve a vested interest in aged care, I encourage young Aussies to seek work in that sector & encourage Govts. raise pay.

Robert Oakeshott MP ‏@OakeyMP
Concerned at reports that aged care funding is now being tied to industrial relations reform. That is not how aged care reform should be done

Nursing home gross earnings rose by 22% p/a, while #agedcare employee costs rose by only 5%:

Melissa Young ‏@MelissaPHCS
Small aged care providers will be hard pressed to afford to sign up for the workforce compact #agedcare

Melissa Young ‏@MelissaPHCS
Taking $ from services to elders to pay for a workforce compact-How is that “reform”? #agedcare

Liberal Party ‏@LiberalAus
Workforce Compact…another bad joke!  #auspol #MyLiberal

NSWNurses & Midwives ‏@nswnma
We strongly welcome the compact for #agedcare workers – especially #nurses!  @Mark_Butler_MP @alznsw @AustAgeAgenda

NurseUncut Australia ‏@nurseuncut
Aged care #nurses to benefit from new wages compact  @anfbetterhands @unionsnsw #agedcare

Stephen Kobelke ‏@stephenkobelke
#AgedCare Federal Funding Announcement Robs Older West Australians  @SkyNewsAust @ABCNews24 @abcnews @720perth #aupol

6 March:

Nieves Murray ‏@nievesmurray
Chatting on @973ABCIllawarra today about agedcare workforce compact. We welcome it. More training, fair remuneration. It’s the @IRTgroup way

[Follow AAA on Twitter @AustAgeingAgenda]

Industry reaction over the Workforce Compact is clearly divided at the moment. Read who’s pro and anti the federal government’s recently announced Workforce Compact.

Personal carer, Melanie O’Gorman from Brisbane. She is a United Voice union delegate and has worked in residential aged care for six years.

“The compact is a step in the right direction,” Ms O’Gorman said.

“We’ve been pushing wage increases for a long time as there is a need to be recognised for the skills we have.

“With higher wages there’s more incentive to stay there [in the job] because at the moment, wages don’t meet day-to-day expenses. It doesn’t pay the bills. Finally, the government has realised and listened and [agreed to] pump money in to keep skilled workers.

“I love my job but I hate the pay. Lucky I am married so there are two incomes coming in but a lot of people have to survive on the one [low wage from aged care].

“..We feel that now, finally, the government has realised need to do something.

“It’s only a small increase but it’s only a start.”

WA-based aged care provider, Amana Living

Amana Living CEO, Ray Glickman said the $1.2 billion four-year government spend will do “nothing to create a sustainable aged care sector in WA”

“The funding was included in the federal government’s aged care reform package, Living Longer, Living Better, announced last year, which was closely followed by a $500 million cut to residential aged care subsidies.

“The funding announced has been created by stripping money from the care of our frail older people. Not only that but the only way to re-access these care funds will be via deals with unions.

“Our frail elderly are being sold short, and this redirection of existing funding, by adding further pressure to an industry at breaking point, will inevitably impact on the wellbeing of the most vulnerable in our society.

“…Aged care staff are wonderful people who deserve to be paid more. But the only way this can happen is for the Commonwealth Government to fund the aged care sector in a sustainable fashion. More smoke-and-mirrors tricks and union deals will not cut it.”

Seniors advocacy group, COTA Australia

COTA Australia’s chief executive, Ian Yates, said the compact announcement goes “at least a small way” towards acknowledging that aged care nurses, who don’t get paid on par with their hospital colleagues, are worthy of higher pay.

“Between now and 2050 Australia will need an extra 500,000 aged care workers – how will we attract them if we don’t pay them well and provide the same working conditions as in other sectors?,” Mr Yates asked.

COTA also welcomes the government’s intention to convene a broader workforce working group to develop an Aged Care Workforce Development Plan.
“While the wage issue is paramount there also need to be improved conditions more broadly for our precious aged care workforce including better career structures and pathways and improved training and education.
“It is heartening to see the government moving in this direction.”
The workforce reforms were called for by the National Aged Care Alliance, of which COTA is a member, in its Blueprint for Aged Care Reform.

Aged care union, the Australian Nursing Federation (ANF)

The ANF welcomed the compact and commended the government on its commitment to tackling the crisis within the aged care sector, significantly the low wages being paid to nurses and care staff.

ANF federal secretary, Lee Thomas, said: “The compact will provide a real morale boost to aged care workers and delivers most of what aged care unions had sought throughout compact negotiations between unions, aged care providers and consumer groups.

“…The wage increases delivered through enterprise bargaining is the first time in many years that federal government money has been directed straight into aged care workers pockets. It is a fantastic start for aged care workers and the people they care for.”

Peak body for non-profit and for profit aged and community care and retirement living providers, Leading Age Services (LASA)

LASA, unions and the government spent many months in negotiations in order to deliver wage increases to some of Australia’s lowest paid workers.

CEO of LASA, Patrick Reid, believes that “the compact has failed” at a time when staff availability and quality is the critical issue and will continue to be so for the long-term.

The compact is strikingly similar to aged care reforms, is “tinkering at the edges and will not address the real issues faced by the industry”.

“LASA supports an age service workforce that is appropriately paid and well trained but how can this happen with an industry that is put under even greater financial pressure,” Mr Reid said.

“Workers need secure appropriately paid jobs. In age care high quality services are virtually impossible to implement when funding in no way matches the daily demands of resident care or services required.
“Aged services is similar to healthcare, when systemic change is needed the whole system must be looked at, every piece of the puzzle must be taken into account and this has not happened in age services, again the needs of the central players, older Australians have been shunted off to one side.”

“…This government is not providing care based on need it is delivering a system of aged services with an imposed fiscal limit. This is why every 73 minutes another Australian is denied access to aged care.”

Aged care peak body ACSWA (Aged & Community Services WA)

CEO of the ACSWA, Stephen Kobelke, said: “As a matter of principle, ACSWA does not support a framework that diminishes aged care funding to providers in order to channel funds to supplement wage increases.

“Taking money from consumer entitlement to channel to staff wages is inappropriate, particularly in a consumer-focused environment.

“This decision will have significant impacts on the sustainability of providers and the level of care delivered to the frailest and most vulnerable members of our community.

“And we are particularly concerned about the capacity of small, independent, rural and remote aged care providers to satisfy the requirements to access this funding and hope the Government is prepared to assist this group.”

The government’s package also creates an obligation for aged care providers to fund up to a further $3 in wages for each $1 on offer from the government, in addition to implementing new industrial provisions which will have both a financial and administrative impact.

“With this announcement, the government is making a range of assumptions about capacity and viability that does not recognise the diversity in the WA sector and the struggle of our State’s regional service providers.

“Sooner or later, either the Gillard Government or the next will need to bite the bullet and provide new, not redirected, funding for aged care wage increases.”

Aged care union, United Voice

President of United Voice, Michael Crosby, said: “This compact is a good start to supporting those who support some of Australia’s most vulnerable workers, 90 per cent  of whom are women over 45 who work part time.

“The aged care workforce is one of the fastest growing sectors of the economy as our ageing population continues to grow.

“But over this decade Australia faces a shortage of 105,000 age care workers.

“The core of the problem is the poor wages and working conditions of this profession.

“The $1.2b commitment by Government will provide wages relief for some of Australia’s lowest paid workers and will help attract staff back to the industry and encourage others to stay.”

Catholic Health Australia (CHA)

CHA CEO, Martin Laverty, said the success of the compact will be determined by the number of providers who take it up. It will suit some providers, and not suit others.

“It would be unfortunate if some aged care staff miss out on pay increases or receive smaller increases as a result.”

Mr Laverty said two elements of the compact will ultimately determine how many aged care providers sign on to its conditions.

“The first element is the government’s requirement that an aged care provider operating 50 beds or more must enter into or amend their existing enterprise agreement to ensure compliance with a set of government objectives.

“A government contract for services should not in our view stipulate an industrial outcome. Aged care providers and their staff should be free to determine above award employment arrangements at a local level, reflecting the circumstances in their workplace.

“The minister, however, deserves credit for having made concessions in response to arguments CHA put to him. Community aged care providers without enterprise agreements will not need one, nor will residential care providers of 50 beds or less.

“The second element will be determined by maths. Every aged care service is different, and their income and expenditure varies. Some aged care providers will do the sums and find they can meet the new wage, superannuation and work cover insurance costs.

“Other providers will find they are not able to fund the costs the Compact imposes. It’s not clear how many aged care providers might end up in this category – that’s a matter of great concern.

“The work of nursing and care staff in aged care is so important. They deserve higher wages in line with those in the health sector. This will only happen when the Government adopts a funding system for aged care that supports fair and competitive wages, as recommended by the Productivity Commission.

“As a first step, pending research into what it now costs to deliver aged care services, the government has an opportunity to better index funding in the 2013-14 budget.”

Tags: abc, amana-living, anf, cha, cota, father-bob, irt, lasa, twitter, united-voice, wages, workforce-compact,

4 thoughts on “Workforce Compact: Australia’s reaction

  1. Most aged care providers agree and would support a pay increase for the hard-working and very dedicated workers in our industry, however “robbing Peter to pay Paul” as the Gillard Gov’t has done is far too short-sighted, potentially very damaging and does very little to address the real workforce challenges that we face.
    While Minister Butler and his bureaucrats have failed to take up a fantastic opportunity in taking a more wholesome view and embracing the width and breadth of the Productivity Commission’s Report & Recommendations, they continue to play with the edges and create havoc.
    As has been stated by previous respondents, the Dept of Health & Ageing witheld COPO indexation and modified the ACFI scoring tool to claw back $1.6b in order to present this shonky deal of offering $1.2b back to the industry to be paid as wage increases dependant upon providers being able to stump up $3 for every $1 offered.
    Taking funds from direct aged care delivery of which wages form a significant proportion to then offer back as a means to increase employee wages is dispicable.
    It’s past time when the Federal Govt actually needs to find “NEW FUNDING” to deliver the care required by Australia’s growing numbers of frail aged. It’s time the Federal Govt stopped short-changing our seniors.
    With operating costs escalating, much of which has been caused by a carbon tax that does zilch for our environment (just another Gillard tax,) many aged care providers are facing very difficult times.

  2. The LLLB is a reflection of the shallowness of Mark Butler and the Gillard Government’s values. This is not about reform for the aged care sector, neither is it reform for our frail aged; rather it is about caving in to the influence of unions. This aged care industry workforce compact is nothing more than Government ministers beholding to the unions who give them oxygen. Others have said it previously, the Gillard Government is doing another Claytons reform, offering monies taken from somewhere else, creating a big black hole there, only to rebadge it and make it appear like the best thing since sliced bread. The spin is incredible or should I say “uncredible”

  3. It is good to see that there has been some light shed on the darkness here. However this type of incentive should not be linked to industrial outcomes. Carers have the right to negotiate their own working conditions and the simle fact here is they are paid pittens. This needs to change or the care of our aged and vulnerable will deteriorate dramatically.Wake up australia this is your future.

  4. The workforce “deal” as part of LLLB reflects that the Department, Advisers & the Minister, despite years of exposure to the industry still lack the core competencies to understand what the PC & the industry have been on about in terms of sustainability.
    The most recent GPFR results do show an increase in average EBITDA of 22% with 25% showing EBITDA losses. That average level of EBITDA represents a return of less than 3% of the conservative cost of building new aged care stock. Hardly sustainable!
    The previous years GPFR results show 40% making an EBITDA loss BUT most tellingly analysis of the trimmed mean of those results shows that only 15% or so were making returns that suggest long run sustainability.
    So if we increase that by 22% we can conclude that now less than 20% of the industry looks to be financially sustainable – and if I am halfway wrong that still means that an uncomfortable majority of the industry is unsustainable.
    Virtually every element of LLLB has at least a short to medium term financial sting in the tail for one or both of EBITDA and balance sheet stability & cash flows.
    Will the Workforce Deal do much for aged care clients – very unlikely
    Will it help the sustainability of care providers – no
    Will it help the workforce – not much – existing Nurses agreements covering the vast majority of nursing staff already pay more than the requirements of this deal and of the other aged care workers, regrettably while they may be paid more, they are likely to face the workload consequences of an unsustainable deal.

    Oh and by the way the Departments recently released workforce census report concludes that the industry has a high level of workforce retention, training and satisfaction with their employers and a quite low labor turnover – some things that this deal won’t contribute to.
    And yes, the major and big issue from employees was wage rates – part of a fairly uniform picture for staff in our caring professions & workforce.
    That will only be cured by sustainable funding models, as distinct from merely re routing funding from care hours to care rates as will inevitably happen with this deal because increased costs have to be paid for from within the funding model.

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