Gordon Campbell on the crisis in the aged care sector

Every couple of years, a disturbing report is released into the standards of care for the elderly in this country. At quick count we had the report by Health and Disability Commissioner Ron Paterson to the incoming government in 2008, the Auditor-General’s damning report in 2009 into the auditing of New Zealand rest homes, a further report from the by-then departed Paterson in mid 2010 that found some rest homes had “a disturbing culture of non-compliance with clear internal policies and procedures” followed soon afterwards by the highly critical Greens/Labour/Grey Power investigation into rest home care in late 2010…and now we have this week’s report by Human Rights Commissioner for equal opportunities Judy McGregor, who didn’t mince words about the wages and working conditions in the aged care sector: “It offends against human decency,” McGregor reportedly said. “The reliance on the emotional umbilical cord between women working as carers and the older people they care for at $13-$14 an hour is a form of modern-day slavery. It exploits the goodwill of women; it is a knowing exploitation. We can claim neither ignorance, nor amnesia.”

The result is usually a round of tut-tutting and head shaking about the situation but the workers concerned routinely get little more than a round of applause for the work they do before the issue slips once again off the political radar. Yet the situation is due to get worse, not better.There are about 48,000 people receiving care in over 700 aged residential care facilities in this country, with a further 75,000 elderly people receiving some level of state support to enable them to remain in their own homes.

Those bald numbers are due to increase, sharply. To cite the figures from the Greens/Labour /Grey Power study the population aged over 65 will grow from 13% in 2010 to a predicted 19% by 2026 and 25% by 2051. The number of people aged over 85 will also increase – from 58,000 in 2006 to 127,000 in 2026. In line with world wide trends, the rates of dementia are also expected to rise significantly as the general population ages – and to help meet that need, a token amount was set aside in last week’s Budget.

The pattern of provision of rest home care has been changing. Increasingly, chains of major private providers (some owned in Australia, some in Britain) are replacing, or simply taking over the former system of not-for-profit church-run facilities and small scale local providers. Therein lies a puzzle. How can the owners continue to rack up healthy annual profits and yet receive public money, at the same time as the working conditions and the career prospects for the staff on the front lines remain so poor?

The short answer is that there is no adequate auditing of how the public money involved is being spent. Note this exchange, from parliamentary question 11435 in 2010:

Sue Kedgley to the Minister of Health (17 Jun 2010): Is any financial auditing of aged care facilities carried out, to ensure that all government funding is directly spent on the provision of care for the elderly; if so, how, and by whom?

Hon Tony Ryall (Minister of Health) replied: The auditing of aged care facilities does not extend to monitoring how government funding is spent. Private providers are expected to supply contracted care services that meet the assessed need of all the residents and this has been the case under the previous government.

In other words, there is currently no satisfactory way of tracking whether any additional funds would be used for the purpose intended – such as boosting the level of wages, or providing additional more staff or better building maintenance, rather than going into the pockets of shareholders. This was the nub of the Auditor-General’s report as well which decried the auditing of rest homes to be “inconsistent” and sometimes of “poor quality” with “serious failures” that were not initially at least, being picked up.

Provost says auditors have, on occasions, failed to find or report instances where homes have not met standards and serious failings have later been found by other bodies. She says the auditors mostly rely on rest homes to take action to fix problems and rarely make follow up visits to check action has been taken….

The report also found there were potential “conflicts of interest” with some auditors already on a rest home’s payroll for providing other services. It suggests homes may have been choosing the “cheapest and most lenient auditors” who may have had “inadequate skills and expertise”.

In some ways, this shoddiness itself is a by-product of insufficient funding – but it also indicates that until these same auditing processes are improved, pouring more money into the sector will only be siphoned off to fatten the bottom lines of the private providers, and not into the pay packets of the staff on the front lines. Not all care-givers in this sector are reaping big profits, and the majority are not foreign owned chain operations. Yet by the same token, there are elements in this sector who do prey for profit on the people they purport to care for, and until the potential for predation and exploitation is removed by effective oversight and regulation – which in this case, means a government willing to make it mandatory for aged care workers to be paid the same as their equivalents in the public health system, all of the hand wringing about the situation counts for very little.

McGregor, like other reviews and reports before her, urges a revamp of the sector – complete with ministerial responsibility, strict targets, enhanced training etc to bring standards up to the levels found elsewhere in the health sector. While welcome, much of this seems inadequate. Having a Minister for the sector would mean little – if, as now, no will exists at Cabinet level for giving rest home workers anything more substantial than a big round of applause.

Certainly, that was all Senior Citizens Minister Jo Goodhew was willing to offer on RNZ this morning, at least until the magical surplus returns in a few years time – in which case, a meaningful infusion of fresh funding would immediately tip the ledger back into deficit. So don’t hold your breath for government to do anything. If attitudes are to change, perhaps it will require a national campaign headed by the likes of national hero and highly paid All Black Richie McCaw – who, possibly, could be encouraged to put their mouth where their money is, and speak out on behalf of the aged care workers helping the likes of McCaw to increase their wealth:

Similar assumptions can be made about what McCaw does with all that cash. For example, with a little digging through public records, it’s possible to find out McCaw opted to invest in elderly care rest home facilities. He has shares in several.

The emphasis placed on training and qualifications in McGregor’s report will also achieve very little if those achievements are not reflected in adequate wages, and career prospects. As things stand, some aspects of the qualifications process in this sector look more like a scam to extract fees from migrants – who in some cases, as the Greens/Labour/Grey Power report says, have to pay as much as $20,000 up front for sitting literacy tests and gaining “qualifications” that are simply not matched by the subsequent pay rates.

So the shameful situation remains – and some private providers will continue to receive public funds to help prop up their profitable businesses, while their workers continue to be paid at barely more than the minimum wage level. Something has to change, McGregor says, because in less than 10 years New Zealand will need 70 per cent more workers in an industry that already loses a quarter of its staff a year. Well, similar alarms have been sounded before, to both Labour-led and National-led governments. It will require wage regulation and mandatory compliance with quality standards to ensure that standards improve – but as yet, there is little political will, if any, to do so. Meanwhile, the market forces at work in aged care are conspiring to push wages and the work conditions in exactly the opposite direction.