Private for-profit capital moves into aged care

Vanguard May 2014 p. 8

Ned K.

In recent years there has been a significant increase in the number of private-for-profit operators moving into residential aged care.

The giant BUPA private health fund is well established in the aged care industry in most states. More recently, private equity companies like Archer Capital have been buying aged care facilities in the eastern states and now South Australia, with their takeover of Elderly Citizens Homes’ residential care.

Archer Capital trades as Allity in aged care and is moving into the sector as the funding arrangements by the federal government enable aged care providers to charge more (and increase profit) from residents under a user-pays system.

Companies like Allity have a strategy of being one of the higher payers of staff in the industry to attract and retain staff to provide a consistency of care to over-charged residents. This is a clever strategy because companies like Allity know that the

increasing numbers of migrant workers in the sector are desperate for a living wage to establish the basics of life for their families.

However, what it disguises is the research done by several university studies which show that the private-for profit operators in aged care have the worst record on safe staffing levels and safe workloads.

When the Abbott Government announced that it would not require aged care providers to direct increased government funding of $1.2 billion to staff wages and safe workloads and safe staffing levels, the association representing the private providers cheered from the rooftops.

Workers in the industry are struggling collectively to win fair workloads and decent work to provide better care for the residents. They are doing this by raising these issues for inclusion in enterprise bargaining agreements where better conditions of work are often the top issue ahead of a wage rise.

While the Fair Work Act restricts their options for effective industrial action in an industry where going on strike is a last resort, aged care workers have in a growing number of cases voted a majority “No” to Agreements that do not address staffing and safety issues to make a point. Their unity in struggle is sure to grow.