Methodist Mission To Lease Out Its Rest Homes

MEDIA RELEASE
01 02 05

Methodist Mission to lease out its rest homes and hospitals

Yet another major player in the not-for-profit aged care sector is pulling out.

The Board of Methodist Mission Northern announced last week it was planning to lease its aged care homes and hospitals to a private operator yet to be determined.

This follows plans announced by the Salvation Army in November that it intends to sell off its rest homes, and the sale of Presbyterian Support Northern rest homes and hospitals last year to Elrand Holdings.

The Service and Food Workers Union (SFWU), which represents caregivers, laundry workers, kitchen staff, cleaners, orderlies and caretakers in the sector, is disappointed that religious and welfare organisations are selling out to the large private corporations that now dominate the aged care industry.

“Most of the workers in the sector who remained unionised through the 1990’s were employed by not-for-profit religious and welfare organisations like Methodist Mission. These workers managed to hold on to some of the more reasonable rates in the industry, even though many loss of penal rates which cut heavily into take-home pay,” SFWU National Secretary Darien Fenton says.

“In the private sector it’s a different story. SFWU has had to fight for years to secure collective agreements in the large private corporations. Heavy workloads because of under-staffing, excessive hours, low hourly pay rates and a lack of recognition for training and qualifications are major issues for the mostly deunionised workers in the sector,” says Ms Fenton

Ms Fenton says private operators make money out of aged care by controlling costs, in particular by tightening up on staffing levels and holding down workers’ pay.

“The private organisations are reaping huge profits from aged care and the not-for-profit sector struggles to keep pace. The quality of care the elderly receive and the conditions of workers in the sector are factors that are being determined more and more by the large corporate organisations.”

She says religious and welfare organisations built their facilities in the 1960s and 1970s using Government subsidies for capital development, but these facilities are now becoming outdated. Organisations such as the Methodist Mission cannot compete with expensive new facilities being built by the big private operators and do not want to invest their own capital in modernising their facilities.

“One of our concerns is that the private corporations are more reluctant than not-for-profit organisations to operate in locations that are less attractive commercially, such as rural areas. And they are less likely to provide for low-income older people.”

Ms Fenton says it is hard to understand why religious and welfare organisations are giving up on care of the elderly just as the Government is putting more money into the sector. There was an $18.5 million injection in December and a tripartite working party is advising Government on allocations for aged care in this year’s Budget round.

The Methodist Mission cites annual deficits of $2.7 million in 2003 and $600,000 in 2004, and Government under-funding of aged care services, as reasons for getting out of residential care for older people.

But the Methodist Mission’s financial results show that aged care fees and subsidies exceeded aged care costs in all but one of the past five years.

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