Private contractors scored $155.9 million in last week’s budget to put jabs into arms as part of the government’s $7.2 billion COVID-19 vaccine program.
The government has spent big on corporate Australia during the pandemic, with more than $10 billion awarded in pandemic-related contracts last year.
Despite the eye-watering amounts, the rollout isn’t going well. We expected to have 20-25 million COVID vaccines onshore by now, but instead have just 9 million. Only 3 million have made it into arms and less than 300,000 of those into those most at risk: residents in disability and aged care.
Today the disability royal commission will assess the government and its contractors’ vaccination program for disability and disability support workers.
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Details of the contracts remain shrouded in secrecy — the government has refused to make tender details public. Those on the ground have questioned the cost and efficacy of bringing in private contractors following confusion, delays and low vaccination rates.
A series of failures
The government hired four health providers — Aspen Medical, Healthcare Australia (HCA), International SOS and Sonic Clinical Services — to vaccinate aged and disability care residents and supplement state-based workforces.
But there have been myriad problems. Aged care workers have been turned away from their crucial second dose because their initial dose wasn’t recorded in the Australian Immunisation Register. There have been no restrictions on who can register online to receive a dose at Sydney’s mass vaccination hub, causing confusion. A nurse contracted by Aspen Medical gave a Tasmanian aged care resident the vaccine without permission from his legal guardian. One doctor contracted by HCA didn’t complete the required vaccine online training course and administered incorrect doses to two elderly patients. Poor planning led HCA to cancel vaccine deliveries, and thousands of doses have been thrown away after problems with temperature-controlled storage.
HCA chairman Daren McKennay said in a statement that CEO Jason Cartwright had stepped down from his role after the incidents, and that the company shared the community’s serious concerns about patients given incorrect doses.
“We apologise unreservedly to the patients and their families involved for the distress this has caused and assure the community that the error was isolated and will not be repeated,” he said.
The government has refused to provide a breakdown of how many residents in disability care have had their shot, although in late April the disability royal commission heard it was only 6.5%. Many aged and disability care residents, frustrated with the slow speed, have booked into state-run GP clinics for vaccinations.
Health and Community Services Union Tasmania assistant secretary Robbie Moore questions why private contractors were needed at all. Moore tells Inq that Aspen Medical was supposed to recruit nurses from the private sector to administer the shots but when it couldn’t it poached state staff — something state health departments would have been able to organise without paying a contractor.
“It’s been a disaster,” he said.
Aspen Medical referred Inq to the federal Health Department which said it was “not privy to the detail of the Commonwealth contract with Aspen, nor has it been party to decisions made by Aspen around recruitment”.
The Tasmanian Health Department didn’t respond to questions from Inq.
“Aspen Medical has unparalleled experience in relation to administering the COVID-19 vaccine in aged care and disability care,” Aspen said, adding it had previously been contracted to administer vaccinations in the US and the United Arab Emirates.
Health Services Union national secretary Lloyd Williams tells Inq communication with the sector has been poor, with healthcare providers given little information about the vaccine or about their industrial protections.
“We have serious concerns with privatising such an important public health undertaking … without anyone else really putting a clear plan and strategy underneath it,” he said.
Secrecy over contract values
Details of the contracts have remained highly secretive. The contracts have not been listed on AusTender and requests for details, made in Parliament and by Inq, have been ignored.
The four contractors are no strangers to political donations: Sonic Healthcare gave $533,500 to the Liberal Party between 2011 and 2017 (and $55,000 to Labor during the same period), making it the fourth-biggest donor from the health industry ahead of the 2016 election.
HCA is owned by private equity firm Crescent Capital which has contributed $208,250 the Liberals, Labor and the Nationals since 2016-17. And it has been linked to former Labor senator Sam Dastyari.
Aspen Medical was officially opened in 2004 by then-health minister Tony Abbott and has been awarded large controversial government contracts. One of its founding board members was a former Liberal federal health minister, Michael Wooldridge, and its founder, Andrew Walker, who has since left the company, has been accused of hiding $15 million in shares. It donated $54,000 to the Liberal Party between 2013 and 2015, and $29,800 to Labor between 2013 and 2020.
International SOS donated $21,000 to Labor and $14,400 to the Liberals between 2011 and 2017.
The government has increased spending on consultancy firms year-on-year since 2018, and the world’s seven biggest firms scored $1.2 billion last year. Australia’s management consulting market is the fourth largest in the world and worth more than $6 billion a year. As Crikey has previously reported, blue-chip consulting firms have been winners in the vaccine rollout but what they advise on is a secret.
Former Labor adviser and adjunct professor at the Kirby Institute for Infection and Immunity Bill Bowtell tells Inq the health sector is concerned about the reliance on private companies.
“All of these deals are part of the income of the intermediaries and are done at the expense of the public health of the Australian people because they inject delay, confusion, and the return on investment is lousy,” he said.
“If they’re on the high revenue contracts from the Commonwealth, the incentive is to reduce their staff costs to the greatest extent … to maximise profits.”
More accountability needed
Director of the public service research group at University of New South Wales Helen Dickinson tells Inq using private contractors to deliver key services isn’t inherently a bad thing, but poor accountability and specificity in contracts led to underwhelming outcomes.
“We need to get a better sense of what it is we’re trying to contract and what it is we want those things to do,” she said. “Quite often it’s a really vague kind of aspiration and very poor collection of data to know whether those things have been delivered.”
Dickinson says poor community engagement often means performative targets have very little impact on workers or those accessing the service.
“At state and federal government levels you’ve got people who are making policies and contracting for these services who have absolutely no experience of them or don’t understand them all,” she said. “You end up with terrible contracts and terrible local policies.”
The Health Department tells Inq the government had “appropriate contract management arrangements that are commensurate to the nature, scope and risk of the services it has procured”.
“Given the scale and complexity of Australia’s COVID-19 vaccination program, the department continues to work with and seek expertise from the private sector to support the rollout,” it said.
Sonic didn’t respond to a request for comment and International SOS referred Inq to the Health Department.