Religious institutions that run aged care homes do not have to show they are spending millions of dollars in government grants on resident care thanks to an “alarming lack of transparency” in the system, an industry analyst has claimed.
Jason Ward of the Centre for International Corporate Tax Accountability and Research pointed to the example of Blue Care, which has about 47 residential aged care facilities with 5,173 residents. Blue Care is run by UnitingCare Queensland, which sent $25.7m to the Queensland synod of the Uniting church last financial year.
The source of this money is not revealed in financial statements as UnitingCare Queensland does not provide segmented breakdowns for its many operations. Blue Care is not required to file a separate financial statement.
The $25.7m went towards chaplaincy services, insurance premiums, stewardship fees, “redress and sensitive matters contributions” and “other expenses”. It is not clear whether this money came from more than $500m in government grants received by UnitingCare Queensland.
At the end of the last financial year, UnitingCare Queensland also had $218.9m in deposits with Uniting Church Investment Services, a fund used to maximise returns for church initiatives. The source of that money is also not clear in reports.
“This return may be through income to support missional activities and programs of the church and to reduce borrowing required for growth and capital development,” the church website said.
It is not suggested UnitingCare Queensland has done anything illegal or unethical.
Ward said the lack of transparency was alarming given the sector’s ongoing calls for more federal funding to continue operating.
“There are significant concerns that federal aged care funding may be siphoned off to fund other church activities and the growth of other largely publicly funded business at the expense of residents and care workers,” Ward said.
UnitingCare Queensland also runs the suicide prevention service Lifeline and the Wesley, St Stephen’s, Buderim Private and St Andrew’s War Memorial hospitals.
When asked whether any federal funds have been allocated to anything other than the delivery of aged care services, a UnitingCare Queensland spokesperson said all of its property, including residential aged care homes, was owned by the United church’s trust fund.
“As such, each year the Queensland Synod of the Uniting Church provides a range of services to UnitingCare Queensland, including the management of insurance and property administration, which enables UnitingCare Queensland to provide all of its services to the Queensland community,” the spokesperson said.
“Accordingly, the trust receives fees from across all activities of the church to support the work of all agencies and entities owned by the trust.”
The spokesperson did not say whether those fees were sourced from government grants, or from revenue generated by resident fees.
Ward, whose organisation is funded by unions including those with aged care workers, said there was an urgent need to improve transparency so governments can know what funds are being used for and hold companies accountable if necessary.
“The public needs assurance and evidence that funding is going towards improving staffing and care and not being used to extract greater profits or fund acquisitions or property developments,” Ward said.
Last month, Blue Care announced the closure of its Millbank aged care facility in Bundaberg, citing financial and staffing pressures that are acute in regional towns.
“Our facility at Millbank is old and requires significant investment in refurbishment to bring it up to the standard required to accommodate the increasing acuity in residents entering residential aged care,” a spokesperson said at the time.
“As a not-for-profit organisation, these factors have impacted the financial viability of our site.”
Assessing the financial viability of Blue Care is difficult as it is not required to provide its own financial statements. UnitingCare Queensland recorded a $16.7m surplus last financial year. Aged care and community services generated $701m in revenue, or roughly 40% of overall revenue.
The federal government has improved transparency by requiring aged care providers to disclose their finances quarterly, in response to the aged care royal commission.
While more than three-quarters of home care providers recorded a profit in the latest update, 66% of residential aged care providers recorded a loss. Collectively, residential providers lost $465m in three months, or an average of nearly $28 per resident.
Staffing is a major cost as providers often rely on agency workers with higher rates, as they cannot attract permanent staff to work in an historically underpaid industry.
Ward did not dispute many providers need more funds, but accused some providers of “crying poor” and misleading the public about their finances.
“Before additional funding is provided, there needs to be far greater transparency and accountability to ensure spending improves care rather than increase profits or fund expansion and development,” Ward said.
