Mr RAMSEY (Grey–Government Whip) (16:41): Let me say thank you, Minister, for the attention you gave the aged-care industry in the budget. You visited my electorate of Grey in the last six months. You accompanied me out to Ceduna, where we visited the aged-care facilities, and to Peterborough, where we have a few issues it must be said. We have talked extensively about the issues that they face and the difficulties of delivering comparable aged care in a regional setting, in a country delivery, because of the increased costs.
One of the biggest increased costs and the biggest impediment to delivering aged care in the country is the supply of skilled staff. Small units in particular are having to resort to the use of agency care, which is very, very expensive. We know the ideal size for an aged-care facility is a minimum of around 65 or 70 beds. In South Australia, in particular, we have smaller towns which are interspersed by large distances. That is not the status quo. We need the aged-care facilities in these small communities, and we need ways of recognising the fact that it’s more difficult to provide that service in those communities.
I had a long history of working on hospital boards in South Australia before I came to this place. Many of the small towns built hostels. In our wisdom, the hospital boards and the hostel boards amalgamated in the seventies and eighties. It seemed a sensible thing to do, and it was. Then of course in the 2000s the Labor government in South Australia came along and got rid of the hospital boards, and in doing so they inherited a swag of small aged-care units that they had no particular interest in, because those are not their prime responsibility. Yet they have an investment that needs to be renewed, replenished and built upon. A number of those units are facing tough times. Peterborough is one of them. Peterborough, to remind you, Minister, is a standalone hostel now used for high-level care, and the facility, while functional, needs upgrading and expanding. It also needs shifting to connect to the hospital, for obvious reasons, which is basically a new rebuild alongside the hospital. There, there is mutual support, which strengthens both agencies. The community has some significant savings but needs help. Unfortunately, the centre is operated by Country Health SA, which presents the circumstances of the difficulty of the Commonwealth investing in what is a state-run facility. I know you’ve turned your mind to this, and I’m hoping we can find a way forward in the future.
To move on and discuss these issues further, I am part of the Select Committee on Regional Development and Decentralisation, which studied regionalisation and decentralisation around Australia. I asked Eldercare to come to Murray Bridge, when they were in South Australia, because I’d had a number of conversations with them. Eldercare operates a thousand aged-care beds across South Australia at 13 sites, three of which are in the country, on Yorke Peninsula, which is in my electorate. Their annual revenue is just under $100 million. In 2016-17 they had a net surplus of $1.4 million, so they’re certainly not making a fortune-less than two per cent-but they are still viable and have very good assets. Of their three sites on Yorke Peninsula, one is at Maitland and is called The Village. There are 60 residential care beds and 17 retirement living units. The second facility is in Minlaton and is called South Park. It has 18 residential care beds, so it’s a very small site. The third site is Elanora, at Stansbury, with 44 residential care beds and four retirement living units. They also run an aged-care home program across southern Yorke Peninsula, and the sites are responsible for day-to-day management.
Eldercare have had great difficulty in recruiting senior staff, particularly to the Stansbury site, and it’s completely blowing their budget. In fact, this year they’re on track to make an EBIT, earnings before interest and tax, of negative $380,000 from that site, which has over 40 places. That’s a net loss of $9,000 or more per bed. The average care cost as a percentage of the ACFI at Stansbury is 112 per cent. Clearly, if not for Eldercare’s city facilities, their country sites might well be gone already. So my question is, Minister: what is the government doing to ensure country sites like Peterborough and Eldercare’s Yorke Peninsula can not only survive but also expand to meet the anticipated increase in demand?