Electricity, Aged Care Impact

Extract from Hansard

Legislative Council
29 May 2001

Sandra Kanck
Deputy Leader Australian Democrats
Member of the Legislative Council

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The Hon. SANDRA KANCK: I seek leave to make a brief explanation before asking the Minister for the Ageing a question about the impact of increased electricity prices upon the provision of aged care in South Australia.

The Hon. SANDRA KANCK: Members would be well aware that, from 1 July, thousands of contestable electricity customers are facing price increases of between 30 per cent and 100 per cent. I can now tell this Council that the outrageous increase in the price of electricity will also impact directly upon many elderly South Australians living in aged care facilities. Elderly South Australians living in nursing homes and hostels managed by Resthaven (the Uniting Church's aged care community service) will bear the brunt of a $ 140 000 increase in the price of electricity supplied to Resthaven's aged care homes.

The Hon. SANDRA KANCK: That may well be what will happen. The 33 per cent jump in the price of electricity can be covered only by reduced expenditure in other areas. We can expect this figure to be replicated throughout the aged care sector. There are genuine concerns about the impact of the increase in electricity prices on the quality of care the sector will be able to deliver after 1 July. It should be remembered that many of these people have sold their family homes to enter aged care facilities. They are encouraged to think of their new surroundings as another home.

The federal Minister for Aged Care insists that the word `home' be used rather than `facility' when referring to aged care homes. Yet under the Olsen government, because these people come together to live communally in the final years of their lives, they will be treated as components of a business and not as individuals. They will be discriminated against, because to warm the rooms in which they live and to boil the water for their pot of tea costs more than if they lived in private accommodation. My question is: what steps has the minister taken to ensure that the standard of living for elderly South Australians in aged care homes does not decline as a result of increasing electricity prices?

The Hon. R.D. LAWSON (Minister for the Ageing): The honourable member, in her claim that residents in aged care facilities will be discriminated against by reason of any increase in electricity charges, is way off the mark. There is absolutely no justification for asserting that residents of aged care facilities are being discriminated against. It is a fact, as the honourable member will know, that the funding for aged care facilities comes from the commonwealth government. Under the Aged Care Act, subsidies are paid to aged care providers to provide accommodation and services for their older residents. The charges are regulated by the commonwealth government. They will not increase in consequence of any change in the electricity costs in South Australia. No doubt, Resthaven and other aged care providers in South Australia will be making (as I am sure they are already) submissions to the federal government to ensure that the subsidy paid to them by the federal government is increased to reflect any changes in costs in this state.

The Council will remember that some time ago I conducted, on behalf of the government, a campaign to ensure that the disparity that existed between the subsidies paid to South Australian operators, as opposed to those paid to those in some other states, was removed. As a result of those representations, changes were made to the regime, and the disparity about which I spoke is steadily being reduced. However, in light of the circumstances to which the honourable member has referred, I am sure that the operators will be making representations to ensure that their operations and their standards of care are not affected by any increased costs that individual facilities may incur.

The subsidy that is paid by the commonwealth government is not directly related to the cost of water, food, land, wages or the like but is an overall assessment by the commonwealth of the appropriate level of funding, notwithstanding the fact that different costs are incurred in different operations, whether they are in the metropolitan area or in country areas. The standard and quality of care provided by facilities is something that is imposed under the act. Those standards are required to be met, and the operators, irrespective of their cost of operation, are required to meet those standards. There is absolutely no evidence or indication that any operator in South Australia will compromise the standard of care that is provided to residents. If the standard is compromised, there are ways in which the subsidy will be removed from a particular operator under the process of accreditation.