The Australian Nursing and Midwifery Federation (ANMF) has called on the Senate economics reference committee to support its recommendations, which the union claims will ensure better transparency and accountability of for-profit, taxpayer-subsidised aged care operators.
The recommendations propose that any operator that receives over $10 million in government funding will be legally required to file fully audited financial statements with ASIC as well as disclose all transactions between trusts or similar parties that are a part of the company’s corporate structure.
According to ANMF federal secretary Annie Butler, evidence given to the inquiry highlights that many of Australia’s top for-profit providers are utilising tax minimisation schemes while receiving substantial government subsidiaries. She said these funds are not being used in areas that will better improve the care of elderly and infirm nursing home residents.
“We’ve had confirmed that there’s simply no accountability or transparency for the $2.17 billion in taxpayer funding given to the largest, for-profit operators, which makes up over 70 per cent of their total revenue,” she said.
“Our members are increasingly distraught that these big operators clearly have the financial capacity to be employing more nurses and carers, but are choosing to put their profits and returns to shareholders before the safe care of their elderly residents.”
Ms Butler said the issue is particularly prevalent among foreign-owned care providers, which are exploiting loopholes in the tax system and focusing on passing on their profits through dividends.
“Instead of using government funding for the safe, best practice care of the elderly, for-profit providers, some foreign-entities are maximising their profits and dividends, getting away with paying little or no tax through their use of complex corporate structures and related party transactions,” she said.
“The inquiry has heard that large operators like Singapore-listed Opal (part-owned by AMP Capital) paid its owners more than $15 million in dividends in the year that the operating company paid no tax. Another major provider, Allity, never paid income tax and used a 15 per cent interest loan to eliminate its tax liabilities.
“Bupa and Regis didn’t even appear at the inquiry, with the acting chair, senator Jenny McAllister, saying that it ‘raises questions about what they have to hide’.”
Ms Butler said she is glad the inquiry has seen the investigation of Australia’s significant for-profit aged care sector, and hopes it will result in appropriate policy changes.
“The ANMF is pleased that the inquiry has lifted the lid on the tax practices of Australia’s big for-profit aged care providers and, to ensure transparency and public accountability, we are calling on senators to adopt our two recommendations to the inquiry,” she said.