News

Inquiry will ‘shine a light’ on questionable financial practices of for-profit aged care providers

Tuesday 17th July, 2018

The author of a report commissioned by the Australian Nursing and Midwifery Federation (ANMF) showing that Australia’s top for-profit aged care providers have posted large profits whilst taking advantage of AUD $2.17 billion in Australian taxpayer funded subsidies will today give evidence to a Senate Economics Reference Committee investigating the financial and tax practices of Australia’s for-profit aged care providers.

The report, Tax Avoidance by For-Profit Aged Care Companies: Profit Shifting on Public Funds, was prepared by Jason Ward from the Tax Justice Network, as part of the ANMF’s national aged care campaign calling for mandated staffing ratios in residential aged care facilities. It revealed how the top-six providers, some with foreign ownership, used various loopholes, corporate structures and discretionary trusts to avoid paying their fair share of tax, at a time when chronic understaffing has resulted in dangerous workloads for nurses and missed care for vulnerable residents.

Speaking before giving evidence to the Inquiry sitting in Sydney today, Mr Ward, who is an Adjunct Senior Researcher, Institute for the Study of Social Change, at the University of Tasmania, said he was hopeful the Senate Inquiry will continue to “shine light on the sector and lead to meaningful reforms.”

“Most people would have a hard time believing the claims by the largest for-profit aged care companies that they are fully transparent and solely dedicated to providing high quality care. The aged care sector will need additional public funding, but there needs to be greater accountability to ensure better staffing levels and care rather than lining the pockets of executives and investors,” Mr Ward said today.

“While the aged care companies have attacked the report, they have not acknowledged clear examples of questionable tax practices. These include Allity’s loan from shareholders at a 15% interest rate and the ATO’s audit of Bupa for offshore debt payments. Bupa shifted over half a billion in profit to its UK parent company in 2016.

“Bupa continues to insist, despite additional investigations into the company’s tax affairs by the European Commission and the Spanish government, that it does not use any tax avoidance or aggressive tax minimisation strategies.”

ANMF Federal Secretary Annie Butler welcomed Mr Ward’s appearance at the Inquiry, saying his evidence will demonstrate the need for legislation that enforces greater transparency, accountability and financial reporting by Australia’s largest for-profit aged care providers.

“Elderly nursing home residents continue to suffer, even though the top six for-profit providers are reaping in over $2 billion in taxpayer funded subsidies. The report shows that providers clearly have the financial capacity to improve staffing levels, but instead are focused on maximizing their profits,” Ms Butler explained.

“We’re confident that evidence provided to the Inquiry will justify the need for the introduction of legislation whereby aged care providers receiving billions in government subsidies must show the funding is directly being used on care for their elderly residents. That must be a pre-requisite for any taxpayer subsidy, otherwise providers will continue to put profits before people.”

Media Alert

What: Public Hearings, Financial and Tax Practices of For-Profit Aged Care Providers

When: 9.45am, Tuesday, 17 July, 2018

Where: Room P1, The Portside Centre, Level 5, 207 Kent Street, Sydney

To view the full report go to:

http://bit.ly/anmf-taxavoidancereport

For more information on the ANMF’s national campaign Ratios for Aged Care, Make Them Law Now, go to:

http://anmf.org.au/campaign/entry/ratios-for-aged-care

 ANMF media release authorised by Annie Butler, ANMF Federal Secretary. 1/365 Queen St, Melbourne.

The ANMF, with over 268,500 members, is the industrial and professional voice for nurses, midwives and assistants in nursing in Australia.

ANMF media inquiries: Richard Lenarduzzi 0411 254 390.