Rachel Siewert (WA, Australian Greens) Share this | Hansard source

I rise to speak on the Aged Care (Living Longer Living Better) Bill 2013 and accompanying legislation. Before I commence my speech, I seek leave to table three pieces of correspondence from the Minister for Mental Health and Ageing, Mr Butler, which I have circulated to the whips.

Leave granted.

The Australian Greens are strongly supportive of responsible and much needed reform within the aged-care sector. As our population continues to age, the already significant challenges faced by the sector will increase. They can only be addressed through comprehensive reform. We see this reform as being part of that process. This reform has been sought by consumers, aged-care providers and workers. Instead of whipping up hysteria around these changes, we actually listened to what people had to say. We know that people support these reforms and that, in particular, the majority of aged-care providers support these reforms, although they want some amendments, which I will address in my contribution to this debate. Aged care has not dominated the agenda in the way that other major reforms have this year, but it is vitally important reform that will touch most lives at some point, whether it is they are helping a loved one access the services and care they need or whether they are accessing that care themselves.

I know that many organisations have been working on this reform over a long period of time and have successfully put aged care onto the political agenda, firstly with the Productivity Commission process and then through the NACA blueprint. It is because of this tenacity that there will be more options for care, particularly in home care, which will help Australians be able to age in place for as long as possible with flexible care that can change as their needs change.

The Australian Greens believe that all people should be supported with high quality services, regardless of their capacity to pay, so it is particularly pleasing that funding is available to support vulnerable people who are unable to meet the costs on their own. For this reason we have particularly addressed the issue of homelessness, as indicated in our contribution through the committee process where we highlighted this issue, and my colleague Adam Bandt spoke of this issue in the lower house. There are services such as Wintringham Specialist Aged Care—and I acknowledge representatives of Wintringham in the gallery now—and these organisations do absolutely amazing work in providing care and support to some of the most marginalised and disadvantaged members of our community. Individuals who have experienced homelessness are highly likely to need specialised support to address complex behavioural and mental health needs. While facilities such as Wintringham have managed to cobble together some of the mainstream funding available, evidence presented to the inquiry clearly demonstrated that the service had lost about $20 a day per resident with the new ACFI arrangements. Given that these services are not likely to be collecting any fees from their residents, their long-time viability is in question.

Our preference would have been to move an amendment to the legislation, and I did circulate an amendment in the chamber. Unfortunately, due to some complications, that will not be possible, so I indicate that I will be withdrawing the amendment that specifically relates to the homelessness supplement. One of the pieces of correspondence I have tabled is a commitment by the Minister for Mental Health and Ageing, Mr Butler, to implement a homelessness supplement through the principles process. That commitment will be operationalised over the next couple of days and will be implemented on 29 June. In other words, the government has committed funding to a homelessness supplement which will work in combination with the viability supplement. Minister Butler outlines in his correspondence—I understand he will also make a statement about this—that this will be a transitional supplement while the viability supplement is reviewed and that that transitional supplement will continue until a new proper homelessness supplement is put in place. The homelessness supplement will be $15 a day and will work in combination with the other services homeless people will be able to access. I think that is a very positive move, and I am very pleased that the government has agreed to implement that homelessness supplement.

Similarly, I am glad to see that LGBTI people will also be enshrined as a special needs category in the legislation. This group of people are another group of people that have been marginalised when it comes to accessing aged-care services, and recognising them in this legislation will ensure that there is a focus on addressing discrimination on the basis of sexuality in all training and planning aspects of aged care. I believe this is a group who also need legal protections from discrimination, which is why the Greens so strongly supported the amendment that passed through this place earlier this week.

The Greens also welcome the range of other special needs that have been acknowledged in this legislation, including culturally and linguistically diversity and care leavers. I am also particularly glad that the government has taken up the committee recommendation to make amendments to include those affected by forced adoptions, an issue that everybody in this place will know is very close to my heart. Similarly, the addition of specialised supplements for veterans in dementia care is welcome. I am very supportive of the renaming of the dementia supplement to acknowledge that the supplement also covers cognitive impairment and complex behaviours.

However, broader mental health needs still seem to have missed out. Older Australians should have access to quality mental health services, just as other Australians do. This can be particularly difficult in residential care, just as we know accessing GP services in residential aged care is difficult. The government response notes that the review of the legislation should include the mental health needs of older Australians, and the Australian Greens believe that the government should consider creating a special supplement for mental health once that review has been carried out.

All these improvements, along with a significant increase in the number of packages available and funding for wages, are welcome. But the Australian Greens also recognise that, in order to ensure access to and quality of care in the face of rapidly increasing demand, aged-care services need to be financially viable and capable of achieving growth. This legislation will provide the architecture for our aged-care system's future. However, there are limits on the scope of this reform because the government did not go as far as implementing all the recommendations from the Productivity Commission.

Clearly, the issue of how aged care is to be funded into the future is going to need ongoing discussion with the broader Australian community as this pressure increases. Nevertheless, this legislation does represent some significant changes to the way aged care is delivered. For example, consumers will have access to greater control over how they pay for their care and they will be expected to contribute to the cost of their care if they can afford it. The asset-rich, income-poor consumers who have largely avoided paying for high-care places will now contribute the same as somebody else with the same overall means but with a different mix of assets and income. The distinctions between high care and low care, and the associated restrictions on who is asked to pay for their care, will disappear. Overall more consumers will be contributing to the cost of their accommodation and care, and providers will have to contend with the increased control of consumers to choose how they pay for their accommodation, on a daily basis or in a lump sum.

The overall viability of the sector is an issue of concern to us. As well as participating in this inquiry, I have consulted widely with the sector and taken very seriously the concerns of industry about the impacts of legislation could have on their individual businesses. Their ability to navigate the new system and implement these reforms on the ground will determine how many more aged-care places are available and the quality of those services, which in turn is crucial for delivering better aged care for consumers. The current reform package does not necessarily achieve neutrality. There is no neutrality between new daily accommodation payments, DAPs, and the refundable accommodation deposits, RADs, because of the decision to maintain existing arrangements for the primary residence in the assets test.

The most significant change to residential care is focused on the lump-sum payments—formerly accommodation bonds, which are now the RADs. There will now be a clearer link between the cost of delivering accommodation and the cost of that accommodation, whether that is reflected in the lump-sum deposits that individuals use to pay for their accommodation or whether they choose to pay on a daily basis. While these reforms put restrictions on the size of the bonds, they increase the total pool of people who can pay their accommodation fee through a lump sum, as well as lift the distinction between high care and low care. It means that more people will potentially be paying for their care via a lump-sum payment. With this reform those consumers who may have waited too long to enter care because of the perceived barrier that large, low-care bonds have represented will have more options available to them, including the DAPs, and will be able to negotiate combinations of DAPs and RADs. However, as a result, providers have to face less certainty about how consumers will choose to pay their contributions. Evidence to the committee's inquiry demonstrated that this has implications for their business planning, given the industry's heavy reliance on the capital that upfront bond payments provide. In other words, they use that money to build new accommodation. A move away from lump sums will require them to find new ways to attract bank loans to finance their operations and build new facilities and service their debt. These are all matters that I have considered very seriously, particularly as there are some very effective and capable providers who run important services for low-income Australians by making low-care beds available or by operating in regional areas. These services have been and will continue performing ongoing juggling acts to make ends meet. These reforms must strengthen, rather than undermine, these services.

The KPMG modelling on the financial implications of this reform have helped resolve some of these concerns by trying to quantify the effects on the capital available to aged-care providers, but I acknowledge that this modelling cannot account for all factors, and I have made that point in our additional comments to the committee inquiry. I recognise that this modelling may not have resolved all their concerns about what real consumers may actually choose to do, because it is not possible to model everything. There are a number of reasons why people make the particular decision to choose a lump sum or, conversely, a daily payment. I acknowledge that there will be some uncertainty for them to contend with, as the industry is in transition, which is why I have spent a lot of time talking to providers and why the overwhelming message from most of the providers is that they want this legislation to go through—because we need reform.

The shift in the industry's financing structures will be gradual, as all existing contracts—in other words, all the people who are currently in aged care—will be grandfathered under transitional arrangements, but short-term liquidity problems will need to be addressed immediately once issues become apparent. We cannot leave those until the general review of the legislation later down the track; we must address these problems as they arise. However, the Australian Greens are reluctant and do not want to address the issue of the equivalence in treatment of the lump sum and the daily payment by simply allowing lump sum payments to also receive protection from asset testing. The Australian Greens believe this would unwind most of the progress that has been made on ensuring that assets are means-tested and that consumers contribute to the cost of their care. This would in turn undermine the financial viability of the sector into the future. We in fact asked for modelling of these various options and we can see no way of addressing the inequity between daily payments and rates unless changes are made about addressing the value of the primary residence; and, as yet, Australia is not prepared to address that issue, so we cannot fix this particular problem.

We can, however, look at how we address any transitional problems, any viability problems, for the sector. That is why the Australian Greens have introduced amendments to recognise the Aged Care Financing Authority in the legislation as a specialised monitoring body, separate from the Department of Health and Ageing, with a similar composition of industry experience to its current membership. One of the documents I tabled addresses some of the requests that the minister has made to ACFA in their work and in their review process. ACFA can undertake this monitoring work with a view to ensuring the financial viability of the sector and provide timely analysis and make recommendations to the government about how and when to implement transitional arrangements that can address liquidity and capital problems as they arise.

I am glad that the government has also responded to our concerns with an up-front commitment to subsidise business advisory services to residential aged-care providers that need assistance to implement the new accommodation payment system. Some of that information was articulated in the government's response to the Senate committee inquiry.

We have also been concerned about how consumers will be affected by the new co-contribution component and we have paid particular attention to the new home-care fees. While full pensioners will receive greater support under this legislation—and we are very supportive of that and appreciate the fact that our most vulnerable Australians are being supported in this manner—low-income part-pensioners may face some relatively large fee increases while still facing a range of other cost-of-living pressures. It would be disappointing if this group began to self-ration their care dollars. This was raised as a potential issue during the committee inquiry, and we looked at it carefully. Unfortunately, if we start fiddling with the taper rates, that would lead to a reduction in the number of packages available. We are not sure if the increase in the care fees will have a negative impact in terms of self-rationing. This is another issue that we expect ACFA to watch closely and advise the government on. Again, this issue cannot be left unaddressed in the long term. If people are self-rationing care, if they are unable to meet the costs of care, action needs to be taken as soon as possible. ACFA have a comprehensive work plan set out in the letter that I tabled in this place, and we will very carefully watch ACFA implement that work plan. They are essential, to my mind, in terms of how these reform processes are going to work.

On the whole, the Australian Greens believe that the Living Longer legislation is an important step forward in ensuring quality care is accessible to all older Australians. For that reason, we also support the workforce supplement. We appreciate the fact that the government has made some changes to that and we support those changes because they address some of the concerns of the sector. Our amendments and the commitments that the government has made in response to the very comprehensive committee inquiry have improved the bills further. What we now have before us is an architecture that should ensure the delivery of better outcomes for older Australians and the aged-care sector alike, both now and into the future.

We have listened carefully to all the stakeholders involved in this discussion. It is very clear to us that aged-care providers want this reform. Yes, there are concerns with this reform. We are concerned about some of the weighting for the daily accommodation payment and what that will do to consumer choices—in other words, they may choose the daily payments. However, until we are ready to have a broader discussion—and I agree with the government: this Australian community is not yet ready to have that broader discussion about how we use some of our accumulated assets to pay for our care into the future—this is the best we can do.

We very carefully looked at what the options were for different modelling, for taking into account what is in and out of the assets test, bearing in mind that the assets test is very close, is linked directly, to the age pension assets means-testing process. There was certainly not an appetite to delink those two. You cannot make any other changes to the DAPs and RAD unless you are prepared to significantly increase the cost of care or take the guts out of this package in terms of funding, and we are not prepared to do that.

The Greens will be supporting the package of these bills. We strongly support the passing of these bills on the basis of the homelessness supplement and also the amendments that we have already tabled in the Senate. We support these bills.