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Tag: Privatisation

17/05/2023

Our government is being privatised by stealth.

SMH 17 May 2023

Geoffrey Watson

The PwC scandal is serious, but it seems to have been lost in the background noise of a coronation and a federal budget. Yet the scandal raises some very big questions about how we are being governed.

The facts are simple enough: in 2013, Australia was engaged in an international effort to crack down on multinationals avoiding corporate tax through cross-border income and asset transfers. Specialists from PwC were brought in as consultants and given access to highly secret materials, subject to confidentiality agreements.

PwC’s top international tax partner, Peter Collins, took the information and shared it widely inside the firm. It was then sold to the targets of the crackdown, teaching them how to sidestep the same anti-avoidance measures PwC was helping to draft. The misuse of the highly confidential material was given a name reflecting the targeted market – ‘‘Project North America’’. PwC probably made many millions of dollars.

Disgraceful conduct, but highly lucrative for the partners at PwC.

So how do we know about this? Well, we did not hear it from PwC. In fact, PwC was obstructive: when the Australian Taxation Office sought information, PwC declined to cooperate, claiming legal professional privilege – a tactic commonly deployed by those clients of PwC. Instead, we only know about this from the outstanding work of two journalists at the Australian Financial Review digging into the reasons why the Tax Practitioners Board was resisting the reregistration of Peter Collins as a tax agent. If not for them, this sorry tale would not have come to light.

As usual, there seem to have been few adverse consequences for those involved. Collins and the chief executive of PwC, Tom Seymour, have left PwC, but we don’t know upon what terms – they may have received handsome payouts. We don’t know how much money PwC made from its Project North America because the partners won’t say – and they have not made an offer to disgorge their wrongful profits. PwC has not told us to whom they sold the information, so we have no idea how much tax has been avoided. PwC has announced it will commission an internal inquiry, but that is obviously insufficient.

But this is much more than a story about misconduct by a Commonwealth contractor; it is far darker than just that. There are many questions, all unanswered.

The first question: Why on earth was PwC – a substantial contributor to the global problem of crossborder tax minimisation – involved in designing Australia’s response to that very problem? Anyone could see this was going to be a problem.

That raises the second and even larger question: Why is Australia outsourcing so much of its governing to private enterprise? Policy development and implementation are now routinely taken from the public service and turned over to private ‘‘consultants’’. Some will say this is because the most highly skilled and experienced people are in the private sector and, you know, this is probably true – but it is only true because the private firms have poached the most skilled and experienced public servants from the public service. This makes good economic sense for the big firms who can charge those services back to the Commonwealth at high rates.

I am not exaggerating. Look at the audit results published by the APS for 2021-22. The Commonwealth paid $21 billion for external labour – i.e. consultants, contractors and labour-hire contracts – in a single year. To give some perspective, that is roughly the same as the federal government spent on secondary education that year. This spending was not made public. The Coalition had boasted of massive costs savings through cuts and caps on public service employment without telling us the holes were filled by payments to private enterprise. Our government was being privatised by stealth.

It may be a coincidence but, over the last decade, the major beneficiaries of mass privatisation were donating heavily to both sides of political power – Labor and the Coalition. PwC was one of the largest donors. It is another sad story of inadequate federal election funding laws and the pernicious role of big money in our election cycle.

Will Labor be better? So far, the new government’s response to this debacle has been strangely muted. Existing contracts with PwC must be investigated. Negotiations with PwC for further contracts must be frozen. Heads must roll. We need an inquiry – surely we should not be outsourcing that to PwC.

We need to take a deeper look at the way in which we have been outsourcing government. It seems we have been going down the wrong path. It is time for change.

Geoffrey Watson SC is a director at the Centre for Public Integrity.

01/11/2022

Want to know about high energy prices?

4 September 2022

It is about market failure. When public power utilities were privatised a market was set up and power producers could bid into a market to supply at a certain price for each period of time. But obviously if someone bid in at a low price for part of the market, they would then watch as others bid in higher and made more money. So the price to all producers was set at the last bid, so the cheap producers made a lot of money.

There were a few problems. The amount of electricity needed varies widely. Coal fired power is not very flexible-it needs a constant load, cannot be stopped and can vary its output only slowly and within a limited range. When renewables came, solar is only in the daytime, and wind varies, so the system had a problem with ‘stability’- the ability to dispatch power when it was needed.

Another problem was rorting, though no one wanted to talk about this. There were big players who could withhold power so that there was a shortage; the price went up, and then they all cashed in. ‘Imperfect competition’ as economists would call it. No one wanted to build coal plants and there was not enough storage to let renewable energy last overnight or for dull or windless days. So the Morrison government said that gas was a ‘transition fuel’ and more gas plants would be built.

Meanwhile the Australian gas industry agreed to massive export contracts on the assumption that they could frack Australia as the US had been fracked. But the environmentalists realised the harm this did and resisted. So our price of gas went up. So the companies pressured the Albanese government, which is now breaking its election promises and approving fracking. Sorry environment- what is a bit of permanently polluted groundwater and desertification between friends?

Of course years ago, publicly owned utilities run by professional engineers were charged with providing electricity and gas to the public on a non-profit basis. They charged enough to cover their costs with some money for maintenance and future planning. The price was the average price of generation, not the most expensive component. The model worked quite well and could again. The change to a ‘market’ was ideological.

At an international level, the problem is similar, but it all being blamed on Russia, which is only partly true. Naturally in a globalised world, we are also affected by the European gas market, but less directly, especially if we frack to get out of it; which is a very bad solution, substituting a long-term problem for a short-term one.

Here is an international article:

https://eand.co/this-is-why-your-energy-bills-are-going-through-the-roof-cc99e2a59d12

13/01/2022

NDIS- An Unsuccessful Privatisation of the Welfare System

13 January 2022

I was never in favour of the National Disability Insurance System as I saw it as a defacto privatisation and reliance on a ‘market’ which would have another layer of assessors, who may or may not get it right in a single interview, the award of ‘packages’ of money which may or may not be enough and/or may or may not be wisely spend. The greatest problem was that as a ’market’ it would be always liable to have glossy marketing to vulnerable families, with services delivered as cheaply as possible, by unqualified people and profits skimmed off. The government coffers were topped up by increasing the Medicare levy, which just ensured that the private sector was given huge amounts of public money.

When I was in the NSW Parliament’s Social Issues Committee which looked at the issue, a key problem was that there was no actual numbers of what the needs were for disability services. There were two ways of calculating it. The first was to add up all the people on benefits on the assumption that everyone who needed benefits was getting them. The other way was to ask the Australian Institute of Health and Welfare (AIHW), the government-funded research body what percentage of the population had a disability and multiply that percentage by the population. Their answer was many multiples of those on welfare, presumably either because their relatives or support networks were looking after their problems, or there was unmet need.

It seemed obvious that:

There would be a huge increase in demand when more resources were (at least in theory) available
There would be a lot of bureaucracy that would waste a lot of money
Those actually doing the job and who knew the needs at a practical level would have less control so the decision making would worsen
There would be a lot of profiteering
Disability workers would face a race to the bottom in pay and conditions.

It might be noted that NDIS cuts out when you are 65, so the whole process restarts with recipients having to apply for a Disability Support Pension (DSP). The current government has boasted that it is putting only a third as many people on the DSP as formerly. My experience was that when the NSW government stopped all Workers Comp payments after 5 years, many people who had been on this support for 5 year at least had to apply for the DSP. Figures were rubbery as the NSW government did not want to know how many people were simply tipped off income support, but the best estimate was that about 20% got the DSP and the rest had to go on Jobseeker. I wrote a lot of detailed medical reports for people who were still unable to get the DSP, and then the government wrote to me and said that I could only charge a very modest Medicare amount to write such reports, so presumably doctors will not be able to take much time on them. I cannot write them in the time that the allowance pays. I had one patient who was 61, ethnic, unskilled and illiterate in English who had been on compensation for a back injury 13 years and was carer for an invalid wife and was refused the DSP despite my best efforts and put into the ‘mutual obligation’ multiple job application system.

But to get back to the NDIS itself, I recently chanced across this article recently from an old issue of Green Left Weekly- a personal story. It seems very credible.

My view is the NDIS needs to be abolished, but it will be very hard to rebuild a public welfare support system against a well-funded and established private lobby that is making a fortune and has at least one major party ready to undo any efforts in this direction.

NDIS is also making life harder for disability workers

Janine Brown, Melbourne, February 8, 2019, Green Left Weekly Issue 1208

I am employed as a disability support worker by a council and, since the introduction of the National Disability Insurance Scheme (NDIS), I will soon lose my job. This is my story.

I am in transition to becoming “self-employed” with an ABN (Australian Business Number), which makes me a small business, and enables me to sign individual contracts with each client.

The other alternative was to become an employee of a private company that has contracts with NDIS clients.

From these two bad choices, I decided to go with the former.

We have been told that NDIS will be much better for hundreds of thousands of Australians. But is it?

Once families receive NDIS funding, it is their responsibility to make the choices for their child or adult family member and manage their finances over a 12-month period.

The idea that they are in control of the life choices of their family member may sound appealing. But the stress levels rise with the amount of bookkeeping required and when it is difficult to clearly define their needs.

Parents are encouraged to employ an advisor, but that person is paid for by the funding for their family member. That NDIS planner will recommend “one of theirs”, someone who will ask many questions and tick many boxes but who doesn’t really know the needs and interests of the person concerned.

I was once supporting a child at home when the NDIS planner was interviewing his parents. One of the questions was “Do you own your home?” I invited the planner to meet the child but she declined, saying it wasn’t necessary.

As much as I agree with giving parents options in choosing a carer for their child, the options being presented are often inadequate to the task at hand.

By privatising the disability sector, many people are obtaining an ABN (which is easy to do online) and presenting themselves as a qualified support worker. They do not need background checks and parents who search online for support workers only see promotional material.

I am qualified and have many years of experience, but l am now in competition with an untrained person who is willing to provide “services” at a cheaper rate. They call it business. I call it a dangerous rort.

NDIS has also meant that our work is now casual: we no longer have permanent employment with leave benefits, superannuation and union support.

A few weeks ago a parent asked me to do a buddy shift with a potential new carer as she lives near the client. Having a carer nearby is appealing for parents who may need to call on you at the last minute.

l agreed to do the shadow shift. I found that the inexperienced carer had no idea about the work responsibilities or the safety measures. She had no knowledge about supporting someone who is non-verbal with behavioural difficulties, who needs support in all aspects of daily life. She appeared to be more interested in the times of shifts, rather than the child’s needs.

It is easy to be blinded by the NDIS marketing, but just as the privatisation of the aged care sector has led to cuts in staff, quality meals and wound management, the same is true for the disAbility sector.

There are also many grey areas concerning the care of people with a disability.

Statistics show that as the number of people being diagnosed with autism (done by general practioners) has increased in the past few years. This adds to the NDIS budget.

As a result, NDIS bureaucrats are thinking of using “their people” to make the diagnosis. If this happens, we can expect a decline in the numbers of people being diagnosed with autism and many who need support will not be eligible for funding for appropriate services.

Another grey area concerns supporting people transitioning from childhood to adulthood, and teaching them to become more independent.

It is sometimes possible to teach a person to take public transport to an activity. However, it becomes a crisis situation when the bus/tram/train is late or cancelled and the person has lost all points of reference and they have to navigate replacement measures.

The NDIS planner may have ticked a box for someone to take public transport to an activity when things are going well, but an unexpected or crisis situation which causes the person anxiety is not factored into the plan.

It is imperative that we continue to support vulnerable people in our community. We must not be blinded by the NDIS hype when the reality is vastly different.

www.greenleft.org.au/content/ndis-also-making-life-harder-disability-workers

08/10/2021

Toll Doesn’t Pay Toll

8 October 2021

Trucking giant Toll Holdings tells its drivers to avoid toll roads as they are not worth the time savings. It might be noted that Air Freight to Melbourne is actually taken by trucks, the only thing being sky high is the prices.The toll roads have the price levels befitting a private monopoly of Transurban. They were sold as lessening congestion. They have taken the money and now we have done nothing for our rail network. There was an article in the SMH of 29/9/21 and also this one:

www.truckandbus.net.au/toll-says-no-to-tolls/

08/09/2021

What Has Gone Wrong in Australia?

8 September 2021

John Quiggin gives a good, insightful summary in The Monthly.

www.themonthly.com.au/issue/2021/september/1630418400/john-quiggin/dismembering-government?utm_medium=email&utm_campaign=The Monthly Today – Wednesday 8 September 2021&utm_content=The Monthly Today – Wednesday 8 September 2021+CID_77319af0620e0ea97965a0e5af6e7e60&utm_source=EDM&utm_term=The Monthly#mtr

04/08/2021

The 2021 Census- Why you should put ‘No Religion’

4 August 2021

I thought that Australia was one of the least religious countries in the world in terms of church attendance. When I was in Uruguay a tour guide claimed that his was the least religious country, and I said that Australia was. Looking at church attendance statistics we were both wrong.

Here are some figures from Pew Research in 2018: China 1%, Sweden 6%, Russia 7%, Norway 7%, UK 8%, Germany 10%, France 12%, Uruguay 14%, Spain 15%, Greece 16%, Australia 17%, Chile 19%, Canada 20%, Israel 30%, the US 36%, Bangladesh 58%, Indonesia 73% (From comparecamp.com)

Church attendance is declining everywhere in the developed world, but their influence here is rising due to their systematic entry into politics. Scott Morrison is fond of saying ‘God helps those that help themselves’ and seems to live by this, getting Pentecostals into Parliament and into Cabinet, (not to mention helping himself with sports rorts and car parks).

The religious agenda of subsidies to religious schools to the detriment of State schools, the huge subsidy by tax exemptions for Church-owned land and businesses, the continuation of religious education in supposedly secular schools to the exclusion of secular ethics classes, the exemptions to the Equal Opportunity laws that allow churches not to hire gays, the right to continue to smack children, and even demands to have special rights with the 2019 Religious Discrimination Bill which may have unintended consequences are examples enough.

The subsidies to religion through tax exemptions are principally a historic legacy of when secular law replaced church law. No government has been brave enough to repeal them and in the 1960s ‘State Aid for Church schools’ was a catch cry that allowed governments to win elections as the Church claimed that parents who went to Church schools were paying twice in school fees and in taxes. When I was in Parliament I asked the then Treasurer, Michael Egan, what the cost of the Church tax exemptions were and he replied that it would be too expensive to cost these so he was not going to answer the question!

Another little gem that turned up during the NSW Upper House inquiry into Social Housing (Report No 7/53 2006) was that the NSW government was building houses on Church land. I asked who would own the houses? The answer was that it was a ‘joint ownership’ in which the State owned them at first but over a decade the ownership transferred to the Church, so that in 10 years the Church fully owned them. From Day 1 the Church managed them. How were the tenants selected? Anyone who was on the Housing waiting list could apply. We visited one of the houses, a 3 bedroom one with a retired couple in it. ‘Please notice the garden, they are very proud of it ‘, we were told. The lady of the house was also very proud of her Royal Doulton tea set from which we drank. We asked how she got the house. She said, ‘We heard the Church was going to build some houses so we started going to Church and we were on the list so we got one’. The children and grandchildren come and stay occasionally.

I asked the Church facility manager if he ever had tenant problems. ‘Not often’ he said, ‘As we usually choose the tenants’. ‘But we had one tenant, a blind lady with a little girl, who had a boyfriend and they used to have huge fights and disturb the neighbours’. ‘She had to go’. He showed us a round hole in the plaster where the boyfriend had opened a door roughly and the door handle had punched through. The house was vacant. Blind single Mums with boyfriend troubles get the boot.

This level of detail is not in the final report. No doubt the Church managed properties have fewer tenant problems than the government managed ones, as this why the Housing Dept with limited stock ends up with ghettos of social problems.

The assumptions are that the Church is basically a charity, which does work that no one else would do, and that its right to prosthetise is tolerated as the majority agree with its teachings. We have not reached the stage of the USA where school boards try to stop science teachers teaching evolution, but the religious influence is strong in education. I recall happily singing, ‘All things bright and beautiful, All creatures great and small, All things wise and wonderful, The Lord God made them all’ and several similar verses to follow. It was many years later before I wondered if it was good that this was how it was.

The Church has tried actively in Australia to get people to fill in the census form by how they were brought up, which naturally creates a massive lag in the statistics. I find the church attendance figures above hard to believe and wonder if new migrants of non-Christian faith have swelled the number of church goers. In our area the Presbyterian Church, with a congregation of 2 or 3 closed and was sold a couple of decades ago.

The Christian Churches’ prestige has declined massively all over the developed world, with the paedophile scandals, and now most recently with the scandals at the Vatican Bank, which were alluded to in David Yallop’s 1983 book ‘In God’s Name’ which alleges that Pope John Paul 1 was murdered at least in part because he tried to reform the Vatican Bank.

So it is important that those who do not believe write ‘No Religion’ on the Census form, which is to be filled out for the night of Tuesday 10 August. We need to demonstrate how many non-believers there are, and to work towards the secular state that is supposedly guaranteed in the Constitution.

www.smh.com.au/national/lapsed-catholics-need-to-reflect-their-beliefs-in-the-census-20210730-p58edo.html?fbclid=IwAR3i2ewer_sI58oFyfjHztjKIuNJOQmLFFjeufKFhJGEAWaoSJFn1MGQOf8

21/07/2021

Privatised Job Services- Guess who benefits?

21 July 2021

Privatisation of job services was based on the concept that competition improves performances; hey we all run faster in a race than on a jog.

It takes the simple model and assumes that public servants do not work as hard as the lean, mean private sector workers.

I have worked in the public service here and the UK for some years. I defy anyone to say that salaried doctors do not work hard. How does a basic 60 hours a week, with a few hours of unpaid overtime a day and on call one night in two for ICU or ED sound?

I was at Sydney Water for 13 years. The clerical staff worked their 35 hours, but the professional staff were mainly there until 6pm, despite only being paid to 3.30pm. The clerks knew their jobs and did their jobs. They thought about their work, prioritised the important things and did them. Their jobs were safe, they were honest, and criticism of them was frankly misplaced. So was the idea that a ‘blow-in’ manager could do their jobs better than they could.

The assumption of privatisation of job seeking is that contractors would do better than the CES. The Key Performance Indicators were set up so that they go paid less for people who were easier to place and more for those who were hard to place. So it was presumably staffed as cheaply as possible, and the business model concentrated effort where the most money could be had for the least work. People who would have got a job without the providers help at all were money for jam. People who were very difficult to place were not worth spending time on. So instead of an ongoing effort to help people in whatever way possible there were distorting priorities- what do you expect? In this case you get what you pay for.

There was a similar nonsense when there was a privatised effort to lower unemployment, which was in the mid-1990s. This drive did not come with any more jobs, so the best hope was reclassification of people who were not working. Many people were sent to me as a doctor to fill in their Disability Pension forms, as the private sector were given bonuses to get people off the dole and putting them disability pension qualified as this. And they think that the public service does paper shuffling- they are amateurs!

After they had expanded the Disability Pension numbers a few years went by and Morrison decided that there were too may people on this, so he would make it tougher to get. He boasted that only a third as many people were put on the disability pension in one year than had been the case the year before. I knew some of the people who could not get the disability pension. There were not enough jobs for healthy people, let alone unhealthy ones. They were demeaned and humiliated, with supposed ‘mutual obligations’. They had to waste their time writing job applications for jobs that they had no chance of getting, and presumably the bosses wasted time either reading them, or just binning then without bothering.

When NSW passed legislation that Workers Compensation would only be for 5 years and then they would have to apply for a disability pension the object was to transfer the costs of injured workers from the State insurers’ premiums to the federal taxpayer. Centrelink was having none of that. Of the people kicked off Workers Comp, only about a third managed to get a disability pension; the rest were on ‘Newstart’ applying for jobs that they had no chance of getting and on far less money than before. Patients came to me asking for ever more elaborate reports to try to get disability pensions when they needed them.

One man, a 61 year old Middle Eastern man who had been on compo for 13 years and was carer for his disabled wife could not get a disability pension. He had chronic back pain and a limp. His English was poor, he was illiterate in English (and possibly Arabic) with a file two inches thick. I spent a lot of time writing a report for him. Centrelink thanked me but said they could only pay a small amount for such reports. So I will not do such reports again, and presumably neither will any of the other doctors- we cannot afford to work for free to fight a system with a different agenda.

Meanwhile the private providers are cream-skimming, adding another layer of costs. Because a market system transfers money upwards to those with more economic power who can control their pieces and costs, a government and a welfare system needs to transfer wealth both to everyone in society equally by building facilities everyone can use or by direct payments to those who are unable to get jobs or who are otherwise disadvantaged.

The problem is that jobs are being offshored to low wage countries or replaced by technology. This is national problem for high income countries. It is a problem for the whole country, but it affects some people directly. We are all lucky that our dollar is high and our goods cheaper because low wage countries make things cheaper. So we all should contribute to make our own country more equal.

Until we demand a fair system we will not get one. Stopping rip offs, and paying CES people a fair wage to do a fair job is a start.

https://theconversation.com/the-problem-with-employment-services-providers-profit-more-than-job-seekers-162421?utm_medium=email&utm_campaign=Latest%20from%20The%20Conversation%20for%20July%2021%202021%20-%202008419727&utm_content=Latest%20from%20The%20Conversation%20for%20July%2021%202021%20-%202008419727+CID_fbb8f126a3150e0c593a044f9ebff43b&utm_source=campaign_monitor&utm_term=The%20problem%20with%20employment%20services%20providers%20profit%20more%20than%20job%20seekers

10/07/2021

NDIS Individual Assessments; A Symptom of a Wider Problem

10 July 2021

The current issue in the NDIS (National Disability Insurance Scheme) is the government’s efforts to introduce ‘independent assessments’ of people on the scheme and those who want to get on the scheme. The idea has been abandoned for the present, but that is not the end of the story. It is the beginning.

Some context is needed here. I was on a State Parliamentary inquiry into disability funding during which we heard evidence of inefficiencies within the disability sector where often there were shortages of appropriate services, and in some areas there were none at all. The real crunch time was when parents with children with disabilities realised that they were going to die eventually and wanted to make a plan for the rest of their child’s life. People would apply at various facilities, and be turned away as there were no places. They then assumed that they were on a waiting list, but usually no lists were kept. When a vacancy occurred, whoever applied at that time got it. It was mainly luck. Naturally the people trying to help their loved one wanted a guaranteed package that would continue after their death. More articulate parents and carers, who had struggled for years just wanted the money to buy the services that they felt that they needed. Many carers simply wanted more services, and hoped that a national system that guaranteed services for disability.

Given the political context of privatisation and reducing government involvement in everything, the scene was set to have disability services delivered by the private sector as a massive market for services. The private sector naturally wanted to get access to services that had been provided by government as a source of business and profit.

Government also had a real estate agenda. Some large institutions were on valuable land. The large facilities at Peat Island in the Hawkesbury and Stockton Disability Centre was on beachfront land just north of Newcastle. There was a residence for the grossly disabled opposite Wollongong Hospital that had taken years of fundraising for the parents to achieve. These could be sold off as the mental health facilities had been a few decades earlier, with the catchy slogan of putting the residents ‘back in the community’. The idea that the residents were better off isolated in a suburban homes with few facilities rather than in a community of people with the same problem and a well-structured programme of activities seemed a dubious proposition to me. Resident groups such as the relatives of long-term psychiatric facilities at Bloomfield in Orange were very scared of the suggested changes. There had been problems with the old system and some inappropriate facilities, but an overall lack of facilities was the major problem. It was not even throwing the baby out with the bathwater; it seemed more like smoke and mirrors.

The key question in dealing with any problem is how big a task is it? When the Committee asked how many people with disabilities there were, there was no answer. No register was kept. The two ways of calculating it were:

To add up all the people on all the types of possible benefits and get to a total.
To look at the AIHW (Aust. Institute of Health and Welfare) figures of what percentage of the population was disabled, then multiply this by the total population.

The latter method gave figures about ten times greater. So clearly if help or services were made more available, the numbers involved were going to blow out hugely from what was currently funded.

John Howard passed the Aged Care Act in 1998, which was the blueprint for the privatisation of the sector. Old people are very vulnerable. They have often sold the family home, so they are temporarily cashed up, looking for accommodation and long term care with mental and physical facilities failing, or they would not be there. Carers faced with responsibilities that they were not used to and uncertain of what care was needed were easy pickings also. The whole sector is more like a dysfunctional real estate market; a market failure due to insufficient ‘consumer information’, but also distorted incentives and priorities.

The NDIS was similar. Private operators with slick marketing made promises which would not be tested for some time, but people were signed up now. The not-for profit sector had never paid staff well, but most had a ‘care ethos’. Some of the private providers did not, and regulatory supervision was minimal. The government was pro-business and trying to give away responsibility.

But an absolute shortage of services was still a big factor. A neighbour who was a 95 year old retired academic widower wanted 2 hours a week of home help. For some reason he could not get a community nurse. The best deal he could get was 2 sessions of 2 hours at $65 an hour. The lady delivering the service was paid $21/hr. So much for private services; the ‘overheads’ are huge. I had suggested to Kevin Rudd’s 2020 Vision in 2000 that the Government needed to licence service providers as individuals if they wanted a market model, and our neighbour could have selected a person on a one to one basis. (I never even got an acknowledgement).

Now the government wants ‘independent assessors’ to evaluate cases, presumably to lessen costs. A number of points can be made about this. It assumes that the assessors will learn more about the patient in an interview than the people who work with them already know. The new management philosophy since the 1980s always assumes that a manager at the top will know more than the person actually doing the job. Naturally if the object is to save money and have the person at the bottom paid minimally, requiring no skills and interchangeable in staffing, this may be true. But if the people at the bottom were respected, trained and empowered, the need for the middle level experts might be much less.

‘Independent Medical expert’ assessors are used in the Workers Compensation and CTP systems. They work for agencies hired by insurance companies. Often they find the patients either have nothing wrong with them, or it is degenerative and not related to their injury. These experts are even flown from interstate and save insurers money by denying treatments. Presumably if they find in favour of the patients, their agency gives them less work. The agency takes its cut and has to please the insurer. So the systems are more complicated and an ever higher percentage of the money is spent in trying not to give services. The NZ National Accident Compensation scheme, though it was government owned, went to a private insurance model and the same thing happened. Doctors who had a track record of denying liability were flown around the country to do their medicals.

The assumption may still be that well intentioned assessors still can do better. My widowed mother lived alone in the family home and had a stroke. A neighbour noticed her confused, walking on the balcony. She recovered, but seemed to have lost some judgement. She was assessed by an ACAT (Aged Care Assessment Team) who said that she could live alone in supported accommodation. So we got her into a unit in the grounds of an old house, where she could book a dinner at a days’ notice in the communal dining room, have a nurse onsite during the day, and had a right to a nursing home bed if she ever needed one. Seemed perfect. She said that she could look after herself. Can you microwave a dinner? Yes. OK. Do it. It got done. No problem. Dinners in the frig. Sweets in the jar on the mantelpiece; see you in 2 days. Arrive in 2 days. Dinners still in the frig. Lolly jar empty. Very hungry- can we go to lunch? She could do anything when asked, but could not initiate a process. She could not think to get a dinner from the frig, or book lunch tomorrow in the communal dining room, nor ask for help. The one-off team could not pick this. Neither did the family. But it emerged when the situation at home was known. This is just a story, but a carer who is savvy and properly trained will know more than a university-qualified assessor who has only a short knowledge of the patient. And naturally the person on the job actually delivers the service and is not an extra cost. They can also judge relative needs of people on a run or in an area if resources are limited.

So the scheme to bring in assessors is the tip of an iceberg.

Private insurance models have huge problems at many levels. The overheads of Medicare are a bit under 5%. The overheads of Private Health Insurers are about 12%, and they cannot refuse to pay doctors. The overheads of US Health insurers are about 12-36%, as the best way to improve profits is to cut costs (payments to patients) rather than increase services and then try to prove you have and sell on that basis. At the bottom of the efficiency barrel is our own NSW CTP system with overheads of almost 50%. The question has to be what is the focus of the system? Delivering services, or saving money? The US health insurers, like our CTP scheme are very good at making money. What they make their money from just happens to be people rather than widgets. The main cost savings of privatisation seems to be destroying award conditions and lowering ‘staff costs’. The immense administrative savings from universal systems, where determining entitlement and paying for profits are eliminated cannot be matched by any private system, despite what the ideologues might pretend.

The NDIS is currently a fund supposedly to help people with disabilities. These people apply to get ‘packages’ of money and services. Businesses persuade people to spend their packages with them. It is a market. But there are more people with disabilities than was expected, for the reasons discussed above. So a new level of assessors, were to be rolled in, but a huge outcry has prevented this temporarily. But the problems that led to the need for the assessors remain implicit in the design of the NDIS, which is fatally flawed. The government, particularly this one, is not going to take this very large bag of lollies from the private sector. The totally inefficient Private Health Insurers (PHI) give money to political parties and advance by stealth, letting Medicare become irrelevant for health care. Disability is now also privatised, and a new private lobby is in there. It has not yet generated a Royal Commission into its rip-offs, but it will, not that the Aged Care Royal Commission has stopped the privatisation of aged care. The political forces are too great. It is ironic that as Medicare is starved and pays less and less of the doctors’ fees its levy was increased, using a wave of sympathy for people with disabilities to make a bigger pool of money for increasingly private disability providers.

How to fix the problem?

I do not pretend to have all wisdom on this, but in dealing with difficult political problems I think it is wise to set a direction, take some basic steps and consult widely, looking for advice particularly from those who do not get an immediate financial benefit.

Here is a start:

Recognise that disability is not a sickness. Some disabilities are inherited; others are acquired due to accident, illness or aging. The sector is quite diverse, often divided up by the type of disability or how it was acquired. Sickness has an ‘episode’ model, based on traditional infectious diseases or surgical treatment models. Disability tends to be long-term and may improve or be worked around, or may degenerate gradually. As such it needs long-term solutions like welfare, but using the term ‘welfare’ now implies charity. Disability funding is funding to enable those less fortunate to have as normal a life as possible. From our common wealth, we give more to those who need more so that our society has equal opportunity for all. We are being taught that tax must be minimised and if we are getting less than we pay we are being ripped off. A better model is to consider the statement by Rhonda Galbally, ex-CEO of VicHealth, ‘There are two populations, the disabled and the not-yet disabled; if you are lucky enough to be in the second group, you should be happy to help pay for the first’.

The idea of a universal service obligation is the cornerstone. We should start with the assumption that people with disabilities should live in our society with as normal a life as possible and we should adapt to support them in as cost-effective way as possible.

My suggestion is that the Community Nursing service is the basic structural framework. We assume that people with disabilities will be living in society, and need varied and integrated support. If they are born with a disability or acquire one, they will come in contact with the acute hospital system, which will hopefully document their situation and alert the community support system. People on the ground will then liaise with family to see what support there is for independent living, and organise resources, calling in specialists of required. The cost of home support may be part of a package or allowance. Individuals may register to offer services for everything from shopping, cleaning and lawn mowing to medical or paraplegic support services. The government will register and insure both practitioners and those who use their services and may put training requirements on those who wish to register for some skills. A market with consumer feedback as exists for restaurants or other practitioners will allow people to hire help directly without big corporations adding massive overheads.

Whether the monies are paid separately of via Centrelink is an administrative question, but Centrelink has to have a major makeover so that it is not the niggardly decider of the ‘worthy poor’ with its chief function being to avoid paying anyone, or paying as little as possible. If society cannot find everyone employment, we must share what we have to those who are disadvantaged by disability or circumstance. This will collide head on with the problem of increased numbers of those with disabilities, but the extra load must be seen as part of having a decent society.

The way we are going seems to be privatising, allowing huge profits, then running out of money and shutting the gate on those who do not yet have packages. The independent assessors were merely the instruments of Managers who were not able to make their own assessments and did not trust the people who actually deliver the services. The assessor problem was the tip of the iceberg of a system that has all its underlying assumptions wrong, but sadly has a lot of political power that having been created, may not be able to be undone. The first step is to understand what is happening. Hence this lengthy post.

www.abc.net.au/news/2021-07-09/ndis-disability-independent-assessments-model-dead-after-meeting/100277324

16/04/2021

Skilled Migrants Needed as we stopped training people.

16 April 2021

I note in Australia’s recovery, we now need skilled migrants. Why? Because we stopped supporting TAFE and gave the money to dodgy private providers.

At the other end of the pile we need unskilled migrants to pick our fruit because the wages are so low that Australians do not want to work for them.

Where are young Australians in all this? Are our kids going to unis with no jobs at the end of their courses? In India excess doctors drive taxis. Marx said that the capitalists were more loyal to their class than their country. Are we for a fair go for all Australians of not? A living wage? Or are skilled migrants who settle more likely to vote Liberal?

www.abc.net.au/news/2021-04-15/skilled-migrants-missing-link-australia-covid-economic-recovery/100069670

14/04/2021

A Look at the NDIS (National Disability Insurance System)

14 April 2021

The whole model of the NDIS is wrong. It is all about turning care into a commodity for private profit. The con was that the people with disabilities would have ‘choice’ and could buy services from a range of providers, who would compete to give great service. But there are big structural faults.

Firstly, big corporations want big profits, so this creates an overhead so there is less money available.

Secondly, people are assessed by ‘experts’ so how much money you get based on a single interview. They are not people who actually do the job and could allocate compare the needs of different people in an area. The assessors are an overhead- another layer of managers.

Thirdly, once the money is allocated, those who have it will be encouraged to spend it whether they need it or not. And of course, this will favour those who present well (usually the middle class) and totally disfavour those who did not get a ‘package’.

Fourthly, the ‘market’ model does not work. Those who need the services do not necessarily know who can give them what they need. They are vulnerable to sales pitches from a limited number of providers and they may not even know about other options. In some geographical areas there may be only one provider, so there is no competition anyway; the provider can set the price and the profit.

Finally, the government can just lessen the amount of money and packages available.

When I was in a Parliamentary Committee looking at disability, the first thing we tried to find out what how many people were disabled. No one had wanted to keep records. People who had tried to get services from a provider and been knocked back because there were no places assumed that there would be a list there and if a place came up they would be offered it. Wrong. Usually there was no list, and a new person got the place if they happened to know someone or turn up at the right time. But at a broader level, experts we asked about how much disability there was either told us how many people were on various schemes and tallied these up, or looked at AIHW (Aust. Institute of Health and Welfare) figures, which said what percentage of the population had a disability and multiplied this by the population. The second method gave figures that were about 10x the people on benefits. So it was very obvious that if there was a supposedly universally available system the cost was going to blow out enormously because of the unrecognised demand.

The solution in my view was to have a universal support system that was community-based, like a district nurse model, and then ask the people actually doing the job, who needed more, and who could be helped to get their own home help from a number of people who would be registered in classes of carers. The government would then buy services in response to the needs identified and quantified by those doing the job. The essence of this was the empowerment of those actually doing the job. NDIS actually does the opposite. It is about the government shovelling money to the private sector with some middle ranking experts supposedly swooping in and saying how much money is needed. If they were embedded in the service delivery framework, they would be discussing needs and relative needs with those actually delivering services.

But modern management and politics assumes it knows best and those at the bottom need to be ‘managed’, i.e. told what to do. My experience is that people doing a job usually know more about it than anyone else and the intelligent use of their expertise is the most solid base for management. My experience is also that putting people in charge who are there for the money rather than the job are unlikely to do a better job than those who are more concerned with the job than the money.

I put this in a paper to Kevin Rudd’s’ 2020 Vision’ in 2000, but never even got an acknowledgement. The NDIS, like the Aged Care Act of John Howard seems to have used ‘choice’ as a Trojan Horse for a market model and privatisation. We need to start again. This is just a suggestion of a better model, but given the power of money in politics I am not hopeful of change.

A new article in The Saturday Paper 10/4/21 looking at the cost blowout and blaming those who need the services has a depressingly familiar ring. The blowout was eminently predictable and cost control by victim-blaming at the bottom is more likely than looking for corporate rip-offs at the top. This is what I see every day in Workers Compensation and CTP insurance.

www.thesaturdaypaper.com.au/news/politics/2021/04/13/exclusive-documents-leaked-secretive-ndis-taskforce/161829180011445#mtr