Residential aged care is a deeply personal subject for many Australians. It is an experience we have seen or can easily imagine for our parents, our friends, or indeed ourselves.
Australians have high expectations for this care. They rightly expect that they, and those they love, will be treated with dignity and decency at the end of their lives. The nation faces increasing challenges in meeting those expectations as Australia's ageing population places further demands on our aged care system.
Providers have been publicly vocal for some time that a further public investment of funds will be needed. These views were repeated during the course of this inquiry. In light of this, it is more important than ever to ensure that each dollar that is currently spent on care is used effectively and efficiently.
The sector that receives those funds, however, is undergoing a significant transformation itself. Whilst not-for-profits continue to be the largest group of
providers, for-profits have steadily increased their presence. In 2016–17, for-profit providers held a share of operational residential aged care places that was more than fourteen per cent higher than they held in 2010–11. The consequence of this is that for-profit providers represent a large and growing recipient of public funds.
The report published by the Tax Justice Network-Australia (TJN-Aus) in May of this year raises a series of legitimate questions about how for-profit aged care providers are using this public money. They are questions that merit investigation. Australians would be rightly appalled if it transpired that public money that had been provided to fund care for older Australians had been improperly diverted to other corporate purposes.
Chapter 3 of this report sets out the details of the TJN-Aus Report. The questions raised differ from provider to provider. In short, however, they relate to the use of stapled structures and related party transactions such as financing.
As is also set out in that chapter, the for-profit providers mentioned by TJN-Aus have denied that there is any evidence of malpractice on their part. The providers have objected to the assumptions and implications drawn by TJN-Aus in reaching its conclusions.