Aged-care sector funding crisis--unions and churches call on ministers to act.

NZNO, along with the Service and Food Workers' Union (SFWU) and the New Zealand Council of Social Services (NZCSS), have written to Prime Minister Helen Clark, Finance Minister Michael Cullen and Health Minister Annette King, seeking an urgent meeting to address the "crisis" in aged care.

The three organisations have written to the three ministers stating that the situation in aged care is so critical that only "intervention from the highest political level can achieve progress". Continued underfunding undermined key government strategies, placed a growing number of older people at risk of missing out on needed care, and treated the nursing and caregiver workforce unfairly.

Huge funding shortfalls

The letter states that there is concern in church networks about the ability of church-based social services to continue providing aged care in the face of huge "funding shortfalls".

It points out that union representatives and council members have made Associate Health Minister Ruth Dyson aware of the urgent problems through meetings, forums such as the Health of Older People and through written submissions.

The organisations want next year's budget to allocate a significant increase in money to services for older people. "We cannot overstate the urgency of allocating a significant level of additional funding out of the projected budget surplus into stabilising the funding of aged-care services," the letter states.

All aged-care services--home support, resthomes, continuing care hospitals and dementia care units--are significantly underfunded. Studies by independent consultants have demonstrated underfunding of 10 percent for hospital care; 25 percent for rest-home care and 25 percent for dementia care. Home support services face worse underfunding.

District health boards (DHB), with one or two exceptions, are offering aged-care providers, contracts with price increases ranging from zero to two percent. Such contracts do not cover the cost of services and thus continue to erode service provision.

Serious consequences

The letter states that continued underfunding has serious consequences for the future of aged care with:

* vulnerable older people risking missing out on the care they need;

* the Health of Older People Strategy being undermined at a time when New Zealand faces unprecedented growth in the number of older people; and

* the exploitation of the workforce caring for older people.

The letter also pointed out that there was a huge disparity in the wages and conditions between workers in the public health sector, such as DHBs, and those employed in the non-government sector. This disparity could widen to greater than 40 percent should the national DHB/NZNO multi-employer collective agreement go ahead.

The letter calls on the ministers to ensure the Government commits funding to "honour, value and support older people; enable the sustainable delivery of appropriate services of good quality; and ensure fair treatment for those working in the sector".

The three organisations also called for an immediate increase in the hourly rate paid by DHBs for home support services to incorporate reimbursement for travel time and costs of care workers. They have also called for an immediate increase in the prices paid for residential care to reflect the actual cost of services and to allow wage parity across the whole sector. Appendices to the letter background the key issues in aged care and provide current contract price increases offered by DHBs for aged-care services.