Funding Mechanism Clearly Still Required

2 May 2007

Funding Mechanism Clearly Still Required

Attempts by HealthCare Providers New Zealand today to downplay the potential for wage increases in the Aged Care sector are the clearest sign yet that a mechanism is required to ensure taxpayer dollars invested into Aged Care end up going to working New Zealanders.

In his statement yesterday, Health Minister Pete Hodgson made it clear that he expected DHBs to satisfy themselves that funding went to alleviating the chronic low pay in the sector.

HCPNZ cites minimum wage increases, additional leave and the fair pay rates for nurses in other sectors as pressures on employers’ ability to pass on funding increases to their workers. “These are old arguments that get dredged up every time we talk about a fair share for our members in Aged Care,” says NZNO Organising Services Manager Cee Payne-Harker. “The fact is the Government has sought to address these issues with previous funding adjustments. Yesterday’s announcement was about addressing low wages. It’s that simple.”

“History tells us that employers in Aged Care have not been good at passing on funding to their staff. They cry poverty yet foreign private equity and financial institutions continue to expand in the sector because of the reliable income it generates while workers only benefit from increases to the minimum wage and minimum leave entitlements,” Ms Payne-Harker adds.

Ultimately the aim of any funding boost in the sector is to improve the quality of care available to older New Zealanders. Improving wages will help achieve this by assisting in recruitment and retention. Currently turnover is up to 40% each year meaning new staff constantly require training and skills and knowledge are not developed.

“As we enter bargaining with employers, our members’ expectations are rightly much higher today than yesterday. Aged Care workers are underpaid and this funding is meant as step towards dealing with that issue,” Ms Payne-Harker says.

ENDS

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