The Not For Profit is undergoing a restructure to bring its staffing costs down to 85% of their Government subsidy income after sustaining a $20 million loss across its residential care operations last year, CEO Grant Millard has revealed to a NSW parliamentary enquiry.
The enquiry – which is investigating a bill to require 24/7 Registered Nurses in NSW aged care homes introduced to Parliament last year – heard from Mr Millard that the provider, which has 24/7 RN coverage, has gone to the Fair Work Commission to reduce hours across its 23 aged care homes.
“It is an issue of financial sustainability and viability… currently we are operating at a loss of circa $20 million per annum for residential aged care. That is not sustainable,” he said.
“When we look at the performance of Anglican Community Services homes versus the latest StewartBrown benchmark data, our staffing costs are higher. It is somewhat anomalous with the 50 per cent band which we seek to be at.”
While the majority of Anglicare’s 4,000 staff work in direct care, Mr Millard said the cost reductions are aimed at the organisation’s operational roles including catering and servery staff and administration.
“Currently our food delivery cost – which includes central production and kitchen meal preparation, both of which are central and on site – is circa $37 a day, which is very high by industry standards, as an example.”
The CEO conceded that reduced staffing had been identified by the Royal Commission as a factor in substandard care – but made it clear the operator had no choice if it wanted to keep its doors open.
“If you ask whether I am comfortable with reducing the number of hours, no, I am not,” he stated. “That is not the way we want to go, but if we want to stay viable – able to operate –there is very little else. We are a price taker from Government. There is very little that you can do when we are already subsidising residential aged care to the tune of $20 million a year. We cannot do that.”
He added that while Anglicare maintained 24/7 RN coverage, mandating the requirement would put many smaller, regional homes into the red.
“The Royal Commission has made it clear that many providers in regional or remote areas will struggle to staff at an appropriate level [who] have the skills necessary to operate residential aged care and certainly to seek an appropriate skilled and qualified workforce, including registered nurses. They would struggle with viability.”
The question is now: how many other operators are in similar circumstances?
