National Press Club Address 7 June 2023

 

AMBITION FOR AGED CARE TRANSCRIPT

Thank you David and the National Press Club for welcoming me to my first address in this venerable setting.

I acknowledge the traditional owners of this land, the Ngunnawal and Ngambri people. I pay my respect to their elders, past and present, and to all First Nations people here today. Together we stand on the shoulders of 1600 generations of First Nations people.

In my first speech to Parliament, approaching four years ago, I dedicated my time here to being a good ancestor. There is no greater contribution any of us could make then to care for, respect and value the generations that have come before us. It’s difficult to reconcile this is the first post Royal Commission aged care address here at the National Press Club when it is public policy we will all experience in rolling incarnations throughout our lives.

You may care for a loved one, a partner, a friend as they age. You may be the worker that provides care and dignity. Or you may be privileged enough to experience the quiet grace of ageing. How our nation provides for the final years of a citizen’s life is worthy not only of dedication and dollars but of ambition.

It’s a challenge laid down for me by Royal Commissioner Lynelle Briggs who told me in one of my earliest meetings that aged care was mired in crisis due to a lack of ambition. Due to a shrugging of the shoulders. A resigned sigh rather than a raised concern.

Our Government inherited a system that a Royal Commission characterised by a single word – neglect. A sector already at breaking point before the pandemic. A pandemic one provider called ‘a daily war zone’. The challenges we inherited were urgent and the system was flashing bright red.

For these past twelve months I’ve felt the best we could do as a new Government was to triage a crisis even worse than we feared.

Today I want to take you through what happened. Most importantly, I’m here to set out how measuring that progress to keep all of us accountable has brought aged care back from the brink. To set out how twelve months of urgent reform now gives us the capacity to face the future with ambition for aged care. And to set out how we plan to do that. We haven’t come this far… just to come this far. We seek to push forward where others pulled back. We embrace an era of unyielding honesty. Because many of your mothers, fathers and loved ones are frightened about entering residential facilities.

That hurts.

I don’t want Australians to be scared about the care they will be provided in later life. Right now, many are. I don’t want daughters and sons worried about the treatment their parents will receive. Right now, many are. Like so many things neglected for so long, this will take time to deliver a system of care we all deserve. The Royal Commission report described a point in time and urgent measures needed. It set out a path for us to follow to repair a system in absolute crisis. It laid out many aspects of reform that we have set in motion. It provided a strong foundation, for what in the end took a new government, elected with a mandate to end the neglect.

 

WHERE WE HAVE COME FROM

To remain focused on the future, I will not provide the full history of the aged care system. But, where we are going does need some context, so I want to share two key features.

The then Howard Government introduced the current Aged Care Act in 1997. To take a trick from my friend and erudite colleague Mark Butler… here’s a gentle reminder that 1997 was the year crowds lined up outside theatres to see Jack and Rose fight to survive amongst the Titanic’s wreckage. The most popular TV shows in 1997 included Friends, E.R. and Seinfeld – now considered retro. Double denim was cool. Times have changed, but we really are clinging to some things from the nineties.

The Aged Care Act then, which it remains now, is focused on how providers run their services. The legislation sets out the provider’s obligations and responsibilities. While critically important, this focus lost sight of the rights of older people. The Royal Commission describes a need for a clear statement that the care provided to residents is safe and of a high quality. This should be the centre of everything we do. The Commission’s report found more than 30% of aged care residents had experienced substandard care. Found Australia’s aged care workforce understaffed, underpaid, and undertrained

The Commission’s report described the sector’s management like this:

“Those who run the aged care system do not seem to know about the nature and extent of substandard care and have made limited attempts to find out.”

I have sought to find out.

I spent the first year going to every jurisdiction to understand the different models of care, needs of people in different locations, and the hopes and desires of older Australians in our system. I wanted to understand their ambition. The final piece of this purposively short history lesson is that successive governments have invested significant resources into this system.

So, it was beyond regrettable coming into this role, my first Ministerial role, to discover that despite the legislation being geared toward the obligations of providers, that in 2017… $2.5 billion was cut from the sector. This saw the financial performance of aged care providers nosedive. Accountancy firm StewartBrown noted that in 2017 – homes had an average positive operating result of almost $10 per bed, per day. Yet by 2020 it was a loss of more than $8 per bed, per day.

Those cuts meant providers had less money to spend on care. Those cuts put pressure on staffing levels. Those cuts put pressure on quality. Those cuts put pressure on safety.

In just over a year, we have addressed 69 recommendations, almost half of the 148 listed.

 

WHAT WE ARE DOING

We inherited a system on the brink and at the cusp of another COVID winter, which meant the only approach was an urgent one. With the Royal Commission as an ever-present guiding light to act, and a burning need for urgency, we have embarked on more than 100 reform projects in the first 12 months.

We have:

• Extended the Serious Incident Response Scheme to in-home care to make all care recipients safer.
• Introduced 6 new quality indicators for residential aged care services to drive quality improvements.
• Worked with Minister Giles to create Aged Care Labour Agreements.
• Worked with Minister O’Connor on fee free TAFE places and pathways.
• Worked with Minister O’Neil, a friend who worked hard to bring aged care to such focus in the last term of parliament, to keep student visas for aged care.

And that’s just five of more than one hundred reforms we are progressing.

Some of our proudest achievements include:

• Star Ratings
• Care minutes increases
• Wages increase to workers funded as part of a $36 billion budget
• Legislating having a Registered Nurse on site 24/7

On some of these measures we are flying – lifting a standard quicker than we could have hoped. On some measures we fall short. We learn the lessons. We try again.

There is no doubt in my mind that every day I draw heat striving for a higher standard is a day in office better spent than one at the margins, merely content to be avoiding neglect or scrutiny.

  

QUARTERLY FINANCIAL REPORT

For the first time in a decade, workers, residents, stakeholders have reason to feel optimistic. The first aged care Quarterly Financial Snapshot illustrates a major shift in financial performance. The first snapshot was based on the period 1 July to 30 September 2022. That’s important because it gives us a baseline before a number of reforms, including the start of the new AN-ACC funding model, were introduced.

As you all know, it showed a residential aged care sector under strain, with 66 per cent of providers making a loss. The second Quarterly Financial Snapshot, from October to December, is being published right now online… you can access it on the department’s website.

The second snapshot provides the first insight under the new AN-ACC funding model we introduced on 1 October 2022.

This latest Snapshot reveals that by the end of December 2022, the first quarter of our reforms at work, the number of providers making a loss reduced from 66 per cent to 54 per cent.

So… our reforms are making a tangible difference to providers. AND the latest data shows residential aged care providers delivered an improved average of 189 minutes of care per resident, per day, moving closer towards the sector average of 200 care minutes which becomes mandatory from 1 October 2023. We expect the next Quarterly Financial Report, for the period of January to March 2023, to continue the upward viability trend.

While from 1 July this year, residential aged care pricing will no longer be based on an outdated indexation factor that didn’t recognise actual costs. The former government increased funding for providers by 1.7 per cent in their last budget, then spent the last twelve months watching that impact and discovering freshly awoken concern about the financial viability of the sector. We put in place independent, expert advice – and then we followed it. This budget, our Labor budget, increases AN-ACC funding for providers by 17 per cent. A tenfold increase.

We can also see strong improvement through the Star Ratings reforms we launched in December. Every quarter, Star Ratings provides an opportunity for homes to demonstrate improvement and the first quarterly update shows the system is working. The freshly updated quarterly ratings reveal an extra 41 services lifted their standards to receive 4 or 5 stars. Crucially, safety and quality are improving. The number of services receiving just 1 or 2 stars has already reduced by more than a third in just these 5 months we have been tracking.

Our ambition is working. Measuring is working. Keeping ourselves all accountable is working. This for the first time, allow us all to be optimistic for the sector and the increased care residents are already receiving. We must always seek to deliver better care and the recent tragedy in Cooma has reinforced the need to greater understand and support people with dementia. Dementia care needs to be core business in aged care. Over half of aged care residents, 54%, have dementia. Over two thirds of aged care residents have some form of cognitive impairment. This is why we are introducing new Aged Care Quality Standards, as recommended by the Royal Commission.

Outcome 2.9.6 under the second standard requires an aged care provider to ensure “all workers are regularly trained in relation to core matters such as…caring for people living with dementia.”

We are also drafting Australia’s new ten-year National Dementia Action Plan. The Plan will provide a nationally coordinated approach to improve outcomes for people living with dementia, their families, and carers across all stages from prevention to care.

It has been a difficult time to have a loved one in aged care and that further demonstrates the pressing need for structural reform.

 

ROADMAP

Furthers the need to make aged care equitable, sustainable, and trusted. That requires vision and clarity. This is our Reform Roadmap.

You don’t need to try and take notes – this will be published on the department’s website. This Reform Roadmap provides our high-level plan to help everyone in this room understand and communicate the positive actions underway. You have been calling for it. I have listened. We have delivered.

Our plan places older people at the heart of all we do. We are seeking to introduce the new Aged Care Act in 2024. This will deliver on 24 Royal Commission recommendations.

This timing is intentional as we want to be able to phase in anything that may come from the Aged Care Taskforce. The new Support at Home program will then commence from 1 July 2025, delivering a further 21 Royal Commission recommendations. With good reason, replacing aged care legislation was the very first recommendation of the Royal Commission.

As I mentioned earlier, the 1997 Aged Care Act was put in place with the primary purpose of funding aged care providers. Our new Act is going to put older people, and the services they need, front and centre. The 1997 Howard era Act relies on the corporations power. Our new Act will be underpinned by relevant international conventions. This shift to a rights-basis is significant.

The cornerstone of the new Act is going to be a Statement of Rights. Rights that need to be heard and observed. An approach overdue in this sector. But still with that record of urgent action and investment… With all the hours of painstaking work … With all we have achieved I’m still saying we have not been able to lift out of triage and prepare for an ambitious future for aged care.

But that changes today.

 

TASKFORCE

Being ambitious means being clear eyed, not just about the scale of the crisis we inherited, but the challenges ahead.

We must act now. The Baby Boomers are coming. Within a decade, our nation will have, for the first time in history, more people aged over 65 than under 18. And our workforce will be ageing, with people aged 15 to 64 years predicted to decline as a proportion of total population.

We have already heard the next generation of people entering aged care are going to want a different model and standard of care than those before them. There will be greater pressures on the entire community. We must be innovative to address this challenge and we need a funding model that is sustainable. We are going to need a fair and equitable system to meet the needs of Baby Boomers who, with their numbers and determination to solve problems, have shaken every single system they’ve come across. They rightfully believe aged care can offer much more than it has.

We know that those people choosing residential care is trending down as the desire to stay and age at home trends upwards. It is why we must re-evaluate the funding going into a system asking for more funding. The Royal Commission heard from 641 witnesses across two years. But the Commission's great unanswered question of the Final Report remains - how to make aged care equitable and sustainable into the future. The Commissioners couldn’t agree on a prescriptive pathway forward. We need to agree on this now. We have heard calls from across the sector to review this funding arrangement and to take a new approach. We are doing this in an open and transparent way. We will do this in conversation with the public, with the discussions driven by experts.

Today I am releasing the Terms of Reference and announcing the membership of the Aged Care Taskforce. I will chair this Taskforce that has yet another ambitious task – reporting by the end of the year and advising the Albanese Government on options. We must modernise a Byzantine system to be future-facing. The Taskforce members have expertise in economics, finance, public policy, ageing and aged care, First Nations, consumer advocacy and provider advocacy. There is a strong focus on the consumer voice and, given this work is intended to support future generations as they move into aged care, the membership also includes a young economist with a strong interest in intergenerational issues and inequality.

I want to publicly welcome the following members, some of whom are in the audience today, and will be familiar to many of you, that will be joining me on this ambitious journey:

Nigel Ray PSM will be my deputy chair, Rosemary Huxtable PSM, Professor Tom Calma AO, Pat Sparrow, Margaret Walsh OAM, Tom Symondson, John Watkins AO, Mary Patetsos AM, Mike Baird AO, Grant Corderoy, John McCallum, Janine Walker AM, Think Forward's lead economist Thomas Walker.

The Taskforce will also include strong union representation to ensure the views of workers are heard.

We have listened to the sector, the workers, and the people, about what care they want and how this could be achieved. We are not taking a patch and paint approach to this process. We have heard directly from workers, their ideas to make lives easier with different models of care. We have heard from providers that current arrangements can stifle innovation. We need co-design, support at home, and policy settings that allow innovative models to be viable investments.

This is about the Government investing in the care that older Australians actually want – and they want to be at home. This is about delivering a needs-based arrangement that makes financial sense. The Taskforce will help our seismic shifts from provider focused to person focused, and funding focused to care focused.  This new piece of work is the next chapter after twelve months of triaging an absolute crisis. This new piece of work is only possible now the results tell us that what we are doing is working. This new piece of work forms part of our capacity to face the future with ambition for aged care.

CONCLUSION

In my first 12 months, I visited 35 aged care facilities across Australia. From Perth to Palmerston. From the Territory to Tasmania.

I met hundreds of residents and staff. Heard great stories of care done well. Heard of the gaps, the struggles, the efforts unrewarded. Too many of them were the same stories I heard on the wings pushing the tray trolleys almost twenty years ago.

I’ve talked you through a lot of policy settings today but I wanted to finish with why this is so important to me.

I wish I could have told a 19 year old Anika scraping dishes in that nursing home kitchen on the weekend that one day she would come to this place as a minister to make an address about aged care reform. I am rueful I didn’t have to look those residents like Peg and Dot in the eye knowing it would be another nineteen years before the standards in aged care would begin to lift in the way they deserved then. And I wish I could tell all the women I worked with like Nia and Sharon that their stories would eventually become my talisman, through twelve months of triaging a crisis. One of those women I was able to bring here with me today.

My mum Deb worked in aged care for fifteen years before she retired, a few with me alongside her. There were good days. There were awful days. And every day, Mum reminds me, they were short of staff. That’s right. Nearly twenty years ago, when Mum was doing the rosters in the nursing home, workforce shortages were the biggest issue.

And today, we can all join Mum in our frustration that workforce shortages are the biggest issue. This has always been a complex and slow-moving area of public policy. But Mum, her co-workers and residents never had a Prime Minister and a government that brought ambition for aged care.

Ambition decades in the making. Ambition born of necessity.

The aged care crisis we inherited truly required a year of urgent triage. Twelve months on, we are tracking tangible, substantial progress.

We are bringing aged care back from the brink – and it’s about damned time.

Thank you.