In this guest post, Mark Harrison partner/executive director at national accounting and business advisory firm Pitcher Partners shares his views on the federal budget due next week and how people and training are integral to the future of the sector.
The fluidity of workers in the sector was reaffirmed at a recent Senate committee public hearing. The committee heard that many aged care providers operate a model with many part-time and casual employees, that allows the facility to flex hours up and down as necessary.
Coupled with the fact that entry-level aged care workers are among the lowest paid in the country often necessitates many people working multiple jobs.
It adds up to a model that creates high staff turnover, which in turn has a negative impact on the quality of care for residents. It is unattractive for recruiting or retaining good employees, and certainly not in the volume deemed necessary if, as expected, the Government increases staff to patient ratios.
About 1 million additional people will need to be employed in aged care by 2050 to meet demand but entry-level aged care workers are currently paid $21.09 an hour – less than a supermarket shelf-stacker.
Raising wages is certainly one aspect to be considered and that will stem largely from the funding model adopted by the Government. A clear model must be the number one priority when the Budget is handed down next month.
What can providers expect in the Budget?
The Government has flagged an aged care-focused Budget next month. There are already reports of significantly increased spending in response to the Royal Commission, reportedly directed at Home care packages, and targeted programs to begin to address the needs of women at risk.
While some people would love to simply see a huge bucket of money tipped over the aged care industry, such a move would be short-sighted and would not address the specific concerns outlined in the Royal Commission’s final report.
The top priority needs to be certainty for the aged care sector in the form of a detailed response to the Royal Commission. The longer that the uncertainty around future funding mechanisms and operational expectations drags on, the greater the delay in investment and flow-on improvements. Providers and investors are hamstrung until they have confidence in the long-term funding model.
However, it is unlikely that the 2021 budget will include the comprehensive review that the Royal Commission recommendations demand, and nor should there be the expectation of such.
Fundamental, considered reform requires deep research, modelling and consideration of the long societal and economic implications of significant policy decisions.
In the short term, the 2021 budget does present several opportunities to develop targeted programs aligned to the needs of aged care, to improve the pipeline of people qualified to work in, and attracted to, the sector.
Scale up home care packages
The availability of home care packages continues to lag behind demand. The latest government figures shore more than 95,000 people on the waiting list.
Home care packages are targeted to the needs of individuals and address a significant proportion of ageing Australia’s needs.
The packages are relatively quick to implement, compared to capital-intensive investment, and can be flexed as future policy needs change.
It makes sense to accelerate the role out of this support mechanism so those with no age care support can obtain at least some comfort and peace of mind.
Create a training ground for workers
The Royal Commission identified that the age care sector has significant scope to increase the skills of its employee participants and to evolve to become an employer of choice.
COVID 19 has significantly disrupted the education sector, particularly international students. The excess education capacity presents an opportunity for targeted training, with appropriate incentives for participants that complete qualifications that answer the needs of the age care sector.
Programs could even be developed to reward those employees that remain in the sector for a significant period, or support employers to take on those that complete such courses.
Encouraging and supporting education and training to the needs of our society makes sense.
Targeted response for regional care
At least seven regional aged care homes have closed in the past year and there are fears for the future of 166 homes in regional areas around Australia.
Without immediate and direct government intervention, many of the operators facing difficulty in maintaining operations and addressing the needs of the community will not survive.
A need for targeted funding existed before COVID-19 created a steady stream of people flowing out Melbourne and Sydney and into regional areas. The exodus will sustain the local economy but puts even more pressure on aged care.
The budget should seek to resolve the rural age care gap and support the needs of these operators that lack the economies of scale but still service a community requiring support.