To understand the significance of the appointment of Butler as Shadow Minister for Ageing, we need to understand two other issues:

  1. There has been a deep divide around the belief and implementation of free markets that has split both major political parties into factions since the late 1970s. This was exemplified by differences in policy between Fraser and Howard, Hawke and Keating, Beazley/Rudd and Gillard, and Turnbull sandwiched between Abbott/Morrison. The second of each paired group followed free market policies more aggressively.
  2. These differences have had a profound influence on aged care policy. On the one hand there are those who see aged care as a market conforming to neoliberal free market and management principles. On the other are those who see aged care as a community service to which the market contributes. The market is required to adopt community values and meet their expectations.

Hawke's attempts to reform aged care during the 1980s were strongly resisted by vested interests and largely abandoned by Keating in the 1990s. In 1997, when Beazley was Labor leader, Senator Gibbs was able to mount a savage and prophetic attack on the Howard government's 1997 free-market aged care policies, predicting that they would fail and explaining why.

Rudd and Turnbull were political opponents, but both became prime ministers as a result of a community backlash against Howard and Abbott policies. But neither were able to substantially change their party's policies in the face of factions in their parties and powerful vested interests. When they tried they were deposed.

Although maligned and perhaps difficult to work with, Rudd's social policies focused on community engagement. He supported the nonprofit sector and place-based solutions to complex social problems. Prior to the 2007 election in 'Labor's Social Inclusion Agenda' his government promised to "tackle the social exclusion of individuals and communities".

In 2009, Rudd attacked neoliberalism in an opinion article in The Monthly claiming that the Global Financial Crisis marked "a turning point between one epoch and the next" as we moved away from neoliberal policies. In 2010 he proposed a mining tax so that some of the large profits from Australia's resources could go to its citizens. These efforts resulted in a savage and damaging attack by industry and the right wing press.

Rudd was deposed on 24 June 2010 and Gillard called an early election for 31 August. She did not gain a majority, but negotiated support from four independents including Rob Oakshott. Mark Butler became Minister for Mental Health and Ageing.

Mark Butler's record

Labor abandoned its opposition to Howard's government policies and embraced the free market, centrally managed changes advised by the Productivity Commission in 2011. Butler oversaw the sort of market policies that Labor had previously resisted and introduced changes that Howard had abandoned. These were promoted to the public as Living Longer Living Better (LLLB) 'reforms'.

In his recent analysis aptly titled The collapse of aged care (Part 1) Rick Morton described how, while John Howard had created the problem when he marketised aged care in 1997, "it was Labor's Mark Butler who really accelerated changes in 2012".

The 2011 Productivity Commission's (PC) report "Caring for Older Australians"

Aged Care Crisis (ACC) made submissions to the PC inquiry pressing for change. Following the release of the draft report, ACC again made submissions criticising what was proposed and issued a media release on 24 January 2011 arguing that the draft report "fails frail older Australians". In its focus on market and competition, it ignored the moral imperative intrinsic to aged care and failed to address the consequences of market reforms.

After the final PC report was released in August 2011, ACC's media release described it as "an opportunity lost". It had neglected critical issues in staffing, as well as the frailty and vulnerability of residents and instead focused on funding and the interests of providers rather than the residents.

There were further in-depth analyses of the report and ACC continued to criticise. Others were also critical.

Read more: Analysis of PC report

A member of ACC did an analysis of what had happened including an outline of ACC submissions. These submissions "attempted to resolve the core issues of independent information collection, community participation, conflict of interest in the collection of information, and transparency".

The member criticised the report for its reliance on the infallibility of markets, failing to address the power imbalance, emasculating regulation and for the tightly controlled central management structure proposed. It would be "a recipe for a lack of transparency and for control over information that would impact negatively on the aged care system or reveal deficiencies in the new regulator".

A separate in-depth analysis pointed out that the sort of market advocated created a "deeply divisive fissure running through the new structure" that was recommended. It had the same deficiencies as the 1997 Aged Care Act in regard to accountability and control. It was an "excellent report, excellent for the providers of aged care, excellent for the politicians, and very plausible to the majority of Australians.

But it was also a "deeply flawed report, limited by the dominant views of its authors and the subculture in which they live". It failed to address the power imbalance and "exposes the aged care system and those it claims to serve to risks that cannot be justified". The report creates "a context likely to compromise objectivity, reduce transparency, misinform, and resist change. It looks remarkably like the system it claims to reform".

On 2 July 2014, as the new Abbott government took over the further introduction of the LLLB reforms, ACC published an article on its web site "Paying more but getting the same" explaining that the Productivity Commission's report and the policies based on it, were skewed by the report's focus on more competition, by fewer regulations to create more efficiency, and by relying on more 'choice'.

The problem was summed up by a key comment from the report: 'Competition is a powerful incentive for providers to improve quality and efficiency, and to offer care solutions that address individuals' needs.'

But that was an illusionary belief because, with vulnerable customers and without an effective and informed empowered community to set limits on conduct, competition in a free and poorly regulated market introduced strong perverse incentives to exploit every weakness the market could find. It was hardly a surprise that many warnings were ignored and that it led to the Royal Commission just seven years later.

Alzheimers Australia (now Dementia Australia) when managed by Ita Buttrose and Glen Rees, was commissioned by the Department of Health and Ageing to consult with community about the PC's recommendations. It interviewed 1,000 people and reported in December 2011. Alzheimers Australia's report considered that the Productivity Commission had "underestimated the issues that continue to beset aged care in the provision of care for people with dementia". It was concerned that the "new organisational and program structures - (would)- distract from the extent to which the current arrangements are failing older people every day".

They were strongly opposed to an "impersonal government bureaucracy such as a national Gateway" (ie MyAgedCare) preferring a "link worker (not a call centre) to provide guidance when needed". They were concerned about "the basics of improving care services and being empowered to be involved in decision making about care". They were not focused on 'choices' as such. The LLLB reforms, economists and industry imposed would give them none of this.

Butler and the "Living Longer Living Better" (LLLB) 'reforms'

In developing the policies based on this report, Butler worked closely with industry. Senior industry figures were co-opted on to government committees. The CEO of BUPA was appointed as an 'Independent Expert' to the new Aged Care Financing Authority advising on funding policy in 2012. In August 2014 he became CEO of Estia Aged Care, a company accused of leading the way in rorting the funding system in 2015-16.

Butler engaged closely with the industry dominated National Aged Care Alliance (NACA) which soon played a major role in policy development and continued to do so.

The history of NACA records that:

"The collaborative activities of the Alliance were taken to a new level" after the PC report and "with the agreement of the then Minister, the Alliance formed working groups to consider and report on key groups of recommendations in the Report".

Funding from government was provided "through a contract with COTA Australia in 2012 and committed through to 2020, - - to form the Aged Care Reform Team which leads, supports and enables the implementation of advisory groups that work with the Department of Health".

The aged care reform advisory groups, "joint initiatives between the Alliance and the Department of Health, provide information, and develop and advocate for particular positions on behalf of the sector to the Department and government on the implementation of ongoing and proposed reforms".

An Alliance member indicated that "A lot of work went into Mark Butler to get where we did". He indicated that "Penny Wong said Living Longer Living Better wouldn't have gone ahead without the Alliance".

It was NACA represented by COTA, the unions and a nonprofit provider that launched the LLLB reforms at the National Press Club on 12 April 2012, aptly calling it "The aged care time bomb is ticking". That is what it turned out to be.

COTA was commissioned to carry out consultations about the proposed reforms in the community. ACC thought that they were too conflicted to do so objectively. Sadly the competitive LLLB reforms provided few if any of the nineteen things COTA found the community wanted. Most were not profitable.

When NACA was formed in 2000 there were three organisations representing seniors involved, Council of the Ageing COTA, National Seniors and Combined Pensioners & Superannuants Association (CPSA). Two were unhappy and resigned. Only COTA remained.  It assumed a central role in promoting the LLLB reforms. The voice of seniors was fractured and only one was supported by government and heard.  The other two were critical of what was being done.

Advised by NACA, Labor did a policy U-turn, adopted the free-market model and introduced the policies that it had previously opposed including those that Howard had abandoned.

Read more: History of NACA

The history of NACA lists all three large organisations representing seniors, COTA, National Seniors (by far the largest) and Combined Pensioners & Superannuants Association (CPSA) as attending their first forum on 17-18 April 2000. It does not document or explain why two of them promptly withdrew from NACA. National Seniors and CPSA did so because it was industry dominated and they were barred from criticising any decisions the majority made. This was unacceptable as they were critical of the flawed 1997 changes and the policies that industry and the Howard government supported.

A long planned merger of COTA and National Seniors finally broke down in 2004 because among other things "the organisation no longer speaks for the less well-off and is too close to the Howard Government".

CPSA had been a powerful force and strong supporter of the reforms introduced in the 1980s and 1990s that the Howard government abandoned in 1997. They were critical of the 1997 changes and, like other organisations that criticised the Howard government's policies, they lost their federal funding. They remain critical of those community organisations that remained with NACA and accepted the 1997 policies.

In October 2011 CPSA pointed out that Labor "did a policy u-turn on aged care" introducing policies it had previously opposed. It remained critical of COTA for remaining a leading member of NACA and so strongly identifying with and supporting its policies. It condemned the NACA marketplace policies which COTA strongly supported and advocated for.

CPSA opposed the LLLB policies, and criticised COTA's selective consultation process pointing out that a much larger survey by National Seniors showed that "Fifty-four per cent of respondents had not heard about the report, and of those who had heard about it, almost two-thirds knew very little" as the proposals had "not been communicated very well by government to the wider community.

CPSA were particularly critical of the new funding structure targeting seniors homes and the decision to announce something so contentious quietly during the Christmas holidays. CPSA's own survey found two thirds of Australians rejected this. CPSA supports a social insurance approach instead, something ignored when it was advised by the Gregory report in 1993. It is now being seriously considered by the Royal Commission.

The economic policy think-tank, the Committee for Economic Development of Australia (CEDA) is comprised of 'leading businesses, community organisations, government departments and academic institutions'. In a speech to CEDA on 3rd April 2013, Butler laid out his policies and acknowledged the major contribution that the Productivity Commission, NACA and members of CEDA had made to these policies.

Introducing a massive time bomb

The LLLB reforms Butler and NACA imposed on the sector, extended 'bonds' (loans from residents) to all residents by removing the distinction between low care and high care for permanent residential aged care. Howard had abandoned these changes in 1997. They renamed them from 'Accommodation Bonds' to the more palatable 'Refundable Accommodation Deposits' (RADs).

Government agreed to underwrite this huge debt owed to residents should companies fail and be unable to refund residents.

RADs gave providers considerable extra funding. Writing about this in the Saturday paper on 5 October 2019 Rick Morton said "Mark Butler, as minister for Ageing, managed to finish what Howard started". Butler was also creating a far bigger time bomb for aged care than the one NACA had claimed to solve. Morton described the consequences.

When competitive marketplace consolidation was encouraged in 2014 it created intense pressure as companies rorted the system and increased debts in order to grow, gain market share and list on the share market. The government was forced to stop the rorting in 2016.

The big for-profit companies that had overspent were trapped and were soon struggling financially so cutting staff. In doing so they were further compromising care. Occupancy fell as the publicity surrounding failures caused the elderly to choose home care instead. Morton described the sector as "at risk of collapse".

If big companies like BUPA, Estia, Regis, Japara and more failed, not only would thousands of frail elderly become the government's responsibility but with a total of $30 billion in bonds owing they would have to pay out billions to refund the RADs that they had underwritten.

These companies were "too big to fail" and government had to give in and rescue them. As Rick Morton indicated "enormous warning bells should have gone off" much earlier. That time bomb has now been passed to the Royal Commission.

Correspondence with the minister as policies failed

In June 2010 appalling standards of care were reported in nursing homes operated by two of the largest and most prestigious for-profit providers by an undercover journalist.

On 14 September 2010, there was another expose on ABC 7.30 of the problems in aged care in which Michael O'Neill, the CEO of National Seniors indicated that there is "no doubt the current aged care system is broken. It reflects a decade of inaction". In frustration he explained that in the previous six years there had been "five separate inquiries by government, but no action coming out of it. All of them put on the bookshelf at the end of the day to gather dust".

Correspondence: Aged Care Crisis had corresponded with the previous minister Justine Elliott. ACC wrote to welcome Mark Butler on his appointment on 24 September 2010 explaining the work that ACC did and our desire to contribute constructively.

The letter drew his attention to the problems of low numbers, poor skills and unregulated staffing as well as the inadequacy of the accreditation and complaints system, the problems inherent in an uncontrolled competitive market, and the absence of transparency and accountability. These were all issues that needed attention. ACC supported "greater community involvement and participation".

These are all unaddressed problems that still face the Royal Commission ten years later. The system is still broken and there are even more problems.

Rorting the system

By February 2012, the press had obtained documents that revealed that there had been a recent cost blowout of $1.9 billion which it was suggested was due to rorting of the system and providers were "exaggerating the needs of their residents" and that money was going to profits and not care. Michael O'Neill called for "much greater transparency and accountability".

The Productivity Commission report was defended by its advocates but described by its critics as catapulting Australia "to the extreme of market-based systems" which could "actually harm consumers". O'Neill indicates that in this sector consumer choice is "bit of a nonsense". Alarm bells were already ringing but no one was listening.

ACC was becoming increasingly concerned by the way the PC report was being converted into policy and the way that policy was being developed within a tightly controlled silo of blind believers in free markets and alternative arguments were being rejected.

On 19 April 2012, a week after the NACA 'time bomb' policy presentation to the National Press Club, ACC sent out one of its periodic circular newsletters headed 'Mr Butler, Please put care before profit'. In this ACC drew attention to the missing voices of residents and their families, the challenge that pressures for profit created for care, what families wanted and what staff indicated was actually happening. Examples were given to show what was happening to the system and the sort of people making policy.

Six months later and almost two years into Butler's term as minister, nurse whistleblowers in his department charged with overseeing funding of aged care spoke out to the ABC 7.30 program on the 17th August about the extensive rorting that his department was deliberately ignoring. Michael O'Neill again indicated that this was "a system that has broken down". It seems that protecting the policy was more important than the residents. Six months later on 13 February 2013 the department admitted to parliament that what they now called "incorrect claiming" was still increasing.

Correspondence to Butler: (1) ACC was aware of the still deteriorating care across the sector including the misuse of sedatives. ACC was alarmed by what it was hearing and by what the minister was doing. On 12 August 2012 ACC wrote a strong letter to the minister about rorting, failures in care including overuse of sedatives, poor staffing and the flawed policies based on the Productivity Commission report.

ACC demanded that policy be radically restructured to include wide transparency, direct accountability to local communities, probity requirements and closer ties and responsibility with health care professionals. ACC attached appendices suggesting strategies for real reform.

Families of residents who had been defrauded and whose complaints had been mishandled by government bodies also wrote to the minister at this time.

(2) In December 2012, ACC discovered that the Accreditation Agency had found a nursing home that was not only understaffed, but which had no staff present at all on site overnight from 8pm to 6.30 am. ACC wrote another strong letter to the minister. The minister's responses when made were underwhelming.

Spinning out of control

In September 2012, Alzheimer's Australia CEO, Glen Rees wrote to the chair of the new Aged Care Financing Authority (ACFA) about the failures in care that were occurring and the lack of "emphasis on the quality of services provided" in the new framework. In his view "issues of cost and quality need to be considered together".

By early 2013, even some in the industry who still supported the Productivity Commission report realised that what had been created under Butler and NACA was simply "fiddling around the edges", advantaging" the larger, commercial providers" at the expense of nonprofit providers, and that the broken system "remains essentially unchanged."

In November 2013 Alzheimers Australia issued a report 'Quality of residential aged care: the consumer perspective'. Its president indicated that there "are still too many cases where the basic human rights of people have been violated within residential care". Many had complained of "disturbing stories - - of physical, psychological and sexual abuse - - " and much more.

In addition to the many usual recommendations about what government and providers should do but have not done, they advised "a coming together of consumers, providers and staff on the action needed" as well as "increase the reach of the Community Visitors Scheme and the role volunteers can have in quality monitoring".

This is in line with the recommendations made in the pre-neoliberal reports of Giles (1985) and Ronalds (1989) and in recommendations which members of ACC had made to inquiries into Complaints (2009), Accreditation (2009) and in far more detail to the PC (2010-11) inquiry.

During 2013, 2014 and 2015 there was ongoing and recurrent rorting of the system and care started to deteriorate rapidly. Whistleblowers spoke out and the number or reports in the press increased rapidly.

Read more: Rorting and widespread neglect

There were accounts to parliament of over-charging in home care in 2013 and again in 2015. There was rorting in dementia care in 2014 forcing the government to terminate a funding stream.

By 2015, there was extensive publicity as the minister called out over-claiming for funding provided for the very frail causing a funding blowout, with some of the biggest market listed companies leading the way. Funding cuts were made and fines imposed.

The system started to break down rapidly with disclosures of widespread neglect on ABC's Lateline program, including problems with  the accreditation and complaint systems, and calls for a royal commission (21 May 2013 --- 15 July 2013a --- 15 July 2013b --- 16 July 2013 --- 22 July 2013 --- August 2013).

The use of restraints was a major staffing-related problem. In 2013, the complaints system and the regulator were also strongly criticised because of their lack of independence.

In August 2014, the Women's Weekly published a three-page article (page 76-78) "The Shocking Abuse in our Nursing Homes". The steady stream of reports highlighting problems continues.

In September 2014, we have a report from Canberra of problems in care due to poor staffing and another about poor food and hygiene.

The drastic reduction in regulatory effort that commenced under Butler and accompanied this deterioration in care, can be seen in the declining number of visits to troubled homes.

Many complaints made to the regulator were due to insufficient staffing or care, yet no one went to look.

Number of visits to homes as a result of complaints

Source: Complaints system's annual reports: 2007-2008, 2008-2009, 2009-2010, 2010-2011, 2011-2012, 2012-1013, 2013-2014, 2014-2015, *2015-2016, 2016-2017, 2017-2018, 2018-2019;
*Aged Care Complaints Commissioner: (six months only)

Looking at defeat in the upcoming election, Labor abandoned Gillard and brought Rudd back on 27 June 2013. He immediately moved Butler away from aged care.

Rick Morton in his article The collapse of aged care (part two) describes how the situation continued to spiral out of control financially and in the provision of care.

Why did this happen?

The reforms recommended by the Productivity Commission to an already failing system, implemented by Butler as minister and supported by NACA and other market advisers, set in chain a multitude of pressures that drove the system into a spiral of failure starting in 2012 and extending into the years immediately after Labor lost power.

Throughout his period as minister, Butler worked closely with providers and their fellow travelers. He was warned and supplied with information, but he ignored this and did nothing. Ongoing deterioration led to the Royal Commission. Why did this happen and what was behind it?

The Abbott government, including Andrews, Morrison and Fifield, continued the LLLB free market reforms when elected in September 2013. They worked closely with NACA in implementing policy. They did nothing to stop what was happening. Their Red Tape Reduction Plan, Aged Care Roadmap and competitive consolidation policies accelerated the decline in aged care. Widespread reports of failed care in the media finally forced Morrison to appoint the Royal Commission into Aged Care in October 2018.

Who controls policy? Who chooses our leaders?

Rob Oakeshott, one of the independents who supported the Gillard government after the 2011 election later revealed what was happening. In an article 'How big business hijacked parliament' he described the extensive access that the wealthiest businessmen had to politicians and how the money they donated to political parties allowed them to influence the political agenda and send "many necessary policy reforms to the doghouse".

He described them as "intimately involved with, and crawling all over, our democracy". He called it "a sold out democracy bent to the will of big business". He described how political donations to both major parties peaked in 2011 and how "political parties took the money and ran". We need to understand what happens in the market and political systems behind the scenes. Oakeshott's revelations explain Butlers conduct and why he was so resistant to information revealing the disastrous situation he was creating and to sensible alternative proposals from critics.

This cozy relationship is reflected in a quid pro quo revolving door between industry and the politicians whose actions on their behalf they appreciate. They move in both directions. Nicola Roxon was Minister for Health during the Rudd and some of the Gillard years before becoming Attorney General.

BUPA's CEO had advised government on LLLB policy when he was chairman of the Aged Care Guild representing the 10 largest providers. He was appointed to the Aged Care Financial Authority to advise on funding the LLLB reforms. BUPA has been a regular donor to both major political parties.

Roxon left parliament in 2013 and a few months later joined BUPA where she soon rose to be chairperson. She resigned in 2019 when multiple failures in BUPA nursing homes were revealed across Australia

Nothing has changed

The influence and the access that large donors have is now being widely recognised and Oakeshott's disclosures confirmed.  In 2018 a report from the Grattan Institute showed what was happening and a senate inquiry made recommendations that were largely ignored.  Donations from large donors were higher than ever during the 2019 election.  In spite of this both major parties joined forces to weaken the laws around donations.  With an election expected late in 2021, the behavior of leaders is being scrutinized and the problem with  donations is receiving attention in the press.

Read more

A 2018 report from the Grattan Institute found that:

"Powerful and well-resourced business groups, unions and not-for-profits are influencing policy - - sometimes at the expense of the public interest
Major donors - - are more likely to get a meeting with a senior minister, and time with ministers is explicitly 'for sale' at party fundraising events
- - just 5 per cent of donors contributed more than half of the big parties' declared donations at the 2016 federal election".

The same year a Senate Committee chaired by the Greens inquired into the impact of donations. It found that the influence of donors on decision making was disproportionate. There were obvious loopholes, and the system failed to provide the necessary safeguards to prevent corruption.

Excessive and unregulated political expenditure could influence voters and materially affect the outcome of an election. There were significant barriers to transparency of the current federal political finance system.

On the one hand charities were strictly governed and not allowed to promote or oppose a political party or candidate, and new legislation under consideration threatened to stifle the legitimate voice of third parties. On the other significant spending by third parties had a corrosive impact during election campaigns. Excessive and unregulated political expenditure could influence voters and materially affect the outcome of an election.

Federal donation figures published in January 2021 show that "donations are highly concentrated among a small number of powerful individuals, businesses and unions" and this was particularly so in the 2019 election. More money and bigger donations were made than ever before. Then quietly in November 2021 "both major parties joined forces in federal parliament to weaken political donations laws".

The Saturday paper on 8th February gives some glaring examples and concludes that "the major block to implementing campaign finance reform in Australia is the firm opposition from the two major parties, which also benefit most from the current system". The 2018 reports and the efforts of a few politicians have clearly had no impact. They don't see why a small handful of citizens should have so much influence on policy.

An election is expected towards the end of 2021. The figures for donations just published will be a stark reminder to both parties that funding from big wealthy donors is likely to be the deciding factor in this next election. Governments are much more likely to do what they are told by donors.

In Aged Care

An article on Lobby Watch on 1 October 2019 describes "the active role the sector's lobby groups and vested interests have played" in aged care public policy. This has resulted in "the regulatory capture of our politicians, regulators and health department bureaucrats" so that since 1997, the "'care' in 'aged care' has been secondary to the financial interests of providers". BUPA was "a long term political donor" to both major parties.

The article briefly describes the activities of the four largest lobby groups in aged care. They have "dominated the policy agenda" resulting in "political inertia and poor outcomes for patients, their families, and workers". They have an "enormous amount of power and influence" and do not "reflect the values, interests and the concerns of the community"

Recent developments

With the final report of the Royal Commission into aged care due at the end of February 2021, it is interesting to see the divisions in Labor opening up again – this time between the president of the party and the leader in parliament.

On 6 January 2021, Wayne Swan, President of the Labor party, issued a media release attacking neoliberalism and claiming that Labor opposed it.

Within two weeks, Anthony Albanese, the leader of the parliamentary party who is currently under pressure, was doing a cabinet reshuffle but there was no challenge to neoliberalism there.

Butler, the Minister who had worked so closely and well with the market, embraced the centralised free market policies, and initiated the reforms that led to the situation that required a Royal Commission, was given the shadow health and ageing portfolio.

Butler had been scathing about Labor's policies after the 2019 electoral loss and in September 2019 called for a review of everything including climate change policy. At the same time Swan was urging the party to "stand up on a pivotal issue like climate". Swan and Butler "reflect the different strands in the party's current internal debate" about policy.

It is now increasingly clear that the government is hoping to call an early election late in 2021 and election fever has gripped parliament's return. The minds of all politicians are now focused on this. Albanese is rolling out "policies encapsulated by his new slogan, 'On Your Side'" and that is about working conditions and jobs.

As in previous elections, the focus is being taken away from aged care and Albanese needs to keep those donors donating to Labor and reduce factional conflict. It is the silent and disempowered elderly who will once again pay the price.

Albanese is moving away from social policy and adopting a policy of fiscal restraint.

Read more: More of the same under Labor?

In an interview with the Grattan institute on 2 February 2021, Albanese was questioned about Labor's policies and prospects. Albanese acknowledged that Labor would "need to have a plan to deal with aged care". Labor is going to go to the next election with a policy of fiscal restraint similar to the present government's. Ministers have been asked to "find cuts and spending offsets". The sort of large expenditure and Medicare style fairness for those who are unfortunate enough to age and die slowly discussed by the Royal Commissioner, will not fit with this. Additional funding to rescue aged care will have to come from those who receive care. This was recommended by the PC in 2011 and implemented in the 2012 LLLB reforms. It is what industry and its wealthy donors want.

But why just before the Royal Commission report is announced, would he choose a minister so culpable for the current failed system and so supportive of neoliberalism in the past? Does he also know something that we don't? Butler was the person that vested interests and probably not Wayne Swan would have picked.

Was Butler in 2011, prepared to cynically sacrifice the lives and welfare of the elderly in order to advantage himself and his party by giving its donors what they wanted? Or alternatively, did a blind belief and supreme self-confidence make him blind to the consequences of what he was doing?

Either way, we should not be voting for a leader with so little insight that he relies on someone with a track record like this. Both likely candidates for prime minister at the next election look equally unelectable.

Royal Commission into Aged Care Quality and Safety

Governments appoint those who are seen as credible, because they think the same way as they do, to inquiries. They do not appoint those likely to investigate and challenge their policies. While submissions that challenged neoliberalism and advocated for a community led system were made, the Commission steered well away from them – in public at least.

ACC has made submissions to the Royal Commission and examined the transcripts of hearings. It felt that the Commission was steering away from root cause analysis of the underlying policies because challenging deeply held beliefs was taboo.  This is why the numerous inquiries since 1997 have all failed. We worry that the symptoms and not the root causes of failure might be addressed and this would be unproductive.  ACC has written to the Commissioners as well as ministers and shadow ministers about this.

Read more: Correspondence to Commissioners

In May 2020 ACC wrote to the Commissioners expressing its concern that the Commission was "publishing discussion papers setting out its proposals and then inviting comment" without first critically examining and debating the thinking behind policies including the "Aged Care Roadmap" or the "Living Longer Living Better reforms".

Without some sort of understanding of the reasons for failure, responses to discussion papers and so final recommendations might simply address symptoms like poor staffing (palliation) without addressing root causes (pathology) and treating the disease. This is what happened when the community were consulted about the LLLB 'reforms'. They did not understand why the system was failing because no in depth analysis of policy was performed.

We did not think that the Commission was challenging "the applicability of the core political beliefs that underpin current policy in aged care". These neoliberal 'truths' seemed to be taboo and we worried they were "shrinking from contentious issues". We expressed our concerns about ideological intractability. While they may have debated these matters in private, it was not done publicly.

We also wrote to ministers of both major parties reminding them that the "most striking feature of the many previous inquiries was "their failure to examine or challenge the belief systems and the policies that both parties have followed ". We explained the difficulties for the Royal Commission asking them to relieve the Commissioners from this "unwritten obligation" by both parties honestly acknowledging that policies had failed and needed analysis so that the Commission would be free to "challenge the philosophical principles behind policy".

In hearings that addressed system design, the Commission consulted principally with industry, economists, government as well as accounting businesses and market advisers that support and work with the industry. These were the same people who worked closely with Butler to develop the LLLB 'reforms' that failed.

Industry bodies like ACSA are boasting about the access they have had to the Commission. In a memo to their members ACSA claimed they "have been at the very forefront of the Commission". They seem to expect a report that reflects their views and are planning an aged care awareness campaign when the report comes out.


It is rare for politicians to blow the whistle on the conduct of their own party, but Senator Fierravanti-Wells called out and blew the whistle on the Abbott, Morrison and Fifield aged care policies publicly and in a submission to the Royal Commission on 10 July 2020.  John Hewson, a past leader of the Liberal party has been outspokenly critical of governments.  

In 2016 Carmen Lawrence, a past President of the Labor party was scathing about what was happening in politics describing "The denial, the infantilising babble, and the fantasies that permeate politics", "airbrushing the past" and not respecting people's intelligence.  

No party can claim ignorance or credibly pretend that it does not know what is happening, what it is doing and how harmful it is for Australia and its citizens. It is increasingly clear that neither major party is prepared to embrace a better future for Australia and its democracy.  

Logically this can only be because politicians are now in bondage to vested interests whose interests are being served by current policy.  These are the people whom Adam Smith described over two hundred years ago as having "an interest to deceive and even oppress the public."

What is needed

It is clear that one-size-fits-all neoliberal free market and management policies have not worked in aged care in Australia and internationally, nor in many other vulnerable sectors. Multiple attempted reforms and attempts at governance have failed. Markets need to be tailored to and accountable to the sectors where they operate. This is currently not the case.

Western democracy depends on a vibrant civil society. Neoliberal free-market policies have marginalised civil society.  Democracy is failing across the world as well as in Australia.  Many who, like the Sydney Policy Lab, study this problem, are calling for "a new relationship between the markets, government and civil society",  for "mass community participation to be valued in public life" and for a collaborative process where policy is "built from the lived experiences of people".

As we indicated in our introduction, aged care must be structured as a community service to which the market contributes. If we are to have a market that works for citizens in aged care then providers of care must work closely with the communities they serve and be directly accountable to them so that policy is based on real lived experience.

There has been no financial accountability or transparency around staffing, complaints or measured outcomes. Multiple inquiries have failed to deliver for citizens. Central regulators are incapable of assuming responsibility without a direct local arm or agent.

Communities need to see where the millions of dollars of taxpayer's money is going, check that it is well spent and that staffing is adequate. They need to see what the outcomes are and that complaints are being addressed. Monitoring of services needs to be ongoing by embracing open disclosure. The only effective way of doing this is by building community structures where citizens can participate in the processes and feed information back to regulators.

Powerful and wealthy vested interests that have controlled the market in their own interests for 20 years will resist this strongly. Only a united community has more power and can change that.

While the Commissioners can still pull a rabbit out of the hat, the omens for aged care do not look good. The optimism of the industry and the appointment of Butler so close to the Royal Commission report can be seen in this light.

Do industry and politicians know more than we do? Are the Commissioners going to take us back to another Productivity Commission style marketplace report and leave our communities out in the cold?


If we as responsible citizens in a civil society want our elderly, and in time ourselves to be given priority over the commercial interests of the shareholders and businessmen who own the providers of care, then we will need to take some responsibility and control.

As communities we need to engage, learn and seek out those with more knowledge. We need to insist that we, as a collective force, have the power to decide who can be trusted to work with us in caring well for our elderly citizens and their families and reject those who fail to do so. That is what makes markets work. The government and central regulators are too far away. Instead of taking over and controlling they need to support and work with communities.

No one else has the power to do this. The Royal Commission can only set the starting line in a favourable or an unfavourable position. Then it will be up to all of us.

But it will be almost impossible to make real progress while we have ministers like Colbeck and Butler responsible for aged care - and prime ministers who appoint them because they must please a small number of powerful self-interested donors if they are to win elections.


#2 Michael 2021-02-11 21:25
The pot calling the kettle black

On the same day that Butler’s deceptive media release was published Senator Keneally, the Shadow Minister for Government Accountability was giving a speech to the National Press Club. She had come “to talk about why integrity in politics matters” and used it to attack the government on the basis that there had been:

1. no consequences for gross incompetence and no penalties for scandalous negligence
2. apathy in the face of incompetence and scandal
3. disregard for the fundamental aspects of democracy: transparency, accountability and integrity
4. dodgy deals with donors
5. A jobs for a mate being a higher priority than the safety and well-being of older Australians.
6. jobs with organisations they worked with as Ministers

The ministers allegations are accurate but her blindness to the current and past conduct of labor (items 1, 2 ,3 and 4) is disingenuous. Giving Mark Butler the health and ageing portfolio. He was the minister largely responsible for creating the neglectful aged care system she castigates (Item 5). Item 6 is also applicable to labor (eg. Nicola Roxon, Minister for health and aging in the last labor government left parliament and became chair of BUPA).

The minister spoke about “the sacred trust between voters, elected representatives and governments” and described government’s assertions as made in a Trumpian fashion. This looks like the pot calling the kettle black. She spoke of labor as “a government that looks after Australian families and is on their side” in the same week that labor appointed a minister who in the past fed them to the lion’s.

The minister claimed that “my job to call-out every government rort and racket, every broken promise, every instance of the Liberals and the Nationals putting their donors and their cronies ahead of the national interest”.

To be credible the minister needs to start by calling out labor’s conduct and get its house in order.
#1 Michael 2021-02-10 10:39

A Misleading Media Release

Butler and Clare O'Neil, the new Shadow Minister for Aged Care Services put out a press release on 9 February referring to a report from the Royal Commission on 2nd February 2021. 

The press release claimed that the report "categorically shows hospitalisation because of preventable causes has dramatically escalated in residential aged care". It followed this correctly with "Under the Coalition's watch, 36.9 per cent of all aged care residents presented to emergency at least once a year".   Then it claimed "there has been a horrific rise in preventable causes of hospitalization."

The figures in the report actually show that, over the 5 years between 2014/15 and 2018/19, hospitalisations from nursing homes increased about 20%.  In the final year of the study, 36.9% of residents presented to an emergency department.  The report commented that "some" were for "reasons that are potentially preventable".  It did not try to assess the number or try to assess how many potentials were actually preventable. 

If this is not fake news, then it is certainly Trumpian distortion and misinformation.   Bu tler is seeking to blame the failures of the policies he introduced in 2012 on the present government, although it is certainly true that they too, did nothing about them.  Their aggressive pursuit of the same policies made the situation worse.

There has been steadily increasing resident frailty for many years.  The deteriorating staffing levels and skills needed for these residents has led to failures in care.  This is a direct consequence of the increased competitive pressures introduced by the 2012 "Living Longer Living Better" (LLLB) 'reforms' introduced by Butler.  

More and more residents from nursing homes have been sent to emergency departments because the declining skills and numbers of trained nurses capable of diagnosing or treating the larger numbers of frail residents with multiple complex disorders, are no longer there and there has been inadequate medical support.  The inexperienced and stretched staff simply require more expert help, the sort of help that was denied them by the changes made in 2012. 

The press release asks "would families trust Scott Morrison to fix his broken aged care system?" and that is certainly true, but it is Butler's system as much as Morrison's.  If this is a sample of the alternative that Albanese and Labor have on offer and they expect us to have faith in them, what hope is there for seniors?