While the aged care royal commissioners Tony Pagone and Lynelle Briggs differ over their funding and governance recommendations in their final report, they make clear exactly where responsibility lies for the catastrophe that is Australia’s aged care system: the neoliberal obsessions of successive governments.
And neither trust government to fix the problem. The main area they differ is just how fundamentally they want to get politicians and the bureaucrats they control out of aged care.
The report outlines how, for decades, governments have refused to fund our aged care system to provide quality care for seniors. Instead, successive governments considered aged care as “a form of welfare for the very needy, to be provided to the bare minimum extent required”.
For example, when the Howard government reformed aged care in 1997, the relevant cabinet memorandum was “not primarily concerned with the quality of care or with ensuring that older people can access the care that they need, but identifies the ‘billions’ in savings that had been achieved to that time by ‘capping service provision’ and the ‘risks’ to the government’s budgetary position”.
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The result has been endless “savings measures, limitations on indexation, and the rationing of services, and it has shifted the capital investment costs of aged care onto older people. It has failed to do the work necessary to determine the right level of funding based on the actual cost of providing high quality services”.
One study quoted by Pagone suggested the aged care budget was $10 billion lower in 2018-19, courtesy of decades of this relentless nickel-and-diming by governments.
A failure to spend was not the only shortcoming. “The aged care system has suffered from sequential attempts by governments to define it as a market in its own right, which can and should behave like any other market in our economy”. And like all “markets”, deregulation and small government was always preferred: “failure to require information from providers on what is happening in aged care services and its ‘light touch’ approach to regulation has hidden these problems for many years.”
Other issues — the persistent workforce problems, dodgy, dangerous and financially unviable private providers, poor care standards, toothless regulators, hopeless bureaucracy — flow from these.
The chief difference between Pagone and Briggs stems from how severely they view this failure. Pagone thinks government — ministers and internal budget processes, the Health Department and its bureaucrats (who told the commission “serious incidents of substandard care do not appear to be widespread or frequent”) — have failed so badly they cannot be trusted with aged care, so every aspect must be made as independent of government as possible.
The Pagone model proposes a new Australian aged care commission, completely independent of government, to govern and fund the sector — rather than the Health Department which for 30 years has presided over catastrophe, and instead of the discredited Aged Care Quality and Safety Commission.
An inspector-general of aged care would investigate systemic problems and an aged care pricing authority would determine what the commission should be paying providers. Both would be independent. Aged care standards would be set by an expanded Australian commission on safety and quality in health and aged care. And aged care funding “should not be subject to the fiscal priorities of the government of the day”. Indeed, “the future financing of aged care should also, as far as possible, be independent of ministerial direction”.
Pagone thinks an aged care income tax levy should provide funding, but wants the Productivity Commission to consider it.
Briggs thinks completely detaching aged care from the bureaucracy and ministerial control would delay reform. She’d prefer the Health Department to remain in charge, though the Aged Care Quality and Safety Commission would be replaced by a more powerful and better-funded aged care safety and quality authority.
This is one area where the Morrison government gets its share of the blame for the debacle: the commission, which Morrison established in 2019, “has been under-resourced and lacks the capacity and capability to perform its functions. It also lacks the independence that this important function requires”.
Briggs also notes that “it has felt like the government’s main consideration was what was the minimum commitment it could get away with, rather than what should be done to sustain the aged care system so that it is enabled to deliver high quality and safe care”. Like Pagone, she wants an independent inspector-general and aged care standards to be set by a commission on safety and quality in health and aged care.
Both wants the standards-setting body to establish new minimum staff ratios, in line with recommendations by counsel assisting. But Briggs is happy to have price-setting carried out by an expanded Independent Hospital and Aged Care Pricing Authority rather than a bespoke aged care-only body.
She also wants to skip the Productivity Commission review and go straight to a 1% income tax levy. Neither Briggs nor Pagone set any store by the Productivity Commission’s previous urgings that seniors themselves pay more for aged care.
You suspect Briggs is the more realistic of the commissioners, despite dismissing a review about how to pay for it all — which, conveniently, would push the issue beyond the next election.
Pagone has looked at the last 30 years of aged care policy with disgust and decided it should be kept away from ministers and bureaucrats as much as possible. Briggs thinks that’s a step too far — and perhaps also that politicians are not going to surrender control.
But ultimately both share the same view: government has been the central problem for a very long time.