Ryall Tony: Social Security (Long-term Residential Care)  Amendment Bill — First Reading 
Ryall Tony: Social Security (Long-term Residential Care)  Amendment Bill — First Reading 
[Volume:631;Page:3085] 
Hon TONY RYALL (National—Bay of Plenty) 
: 
 In speaking to the Social Security (Long-term Residential Care) Amendment Bill I have a number of questions and it would be most helpful if the next Government speaker could address them. There are a number of changes in this bill that I think all parties will support. They are consistent with what we understood and voted for previously in the legislation that Ms Dyson brought in. That legislation was obviously full of mistakes and here we have a bill to clarify it. 
But there is one point that we in the National Party Opposition want to challenge the Government on and that is the comment in the explanatory note of the bill that it is current practice that rest home providers charge the same amount to paying residents as they do to subsidised residents. The Government is trying to say in this bill that subsidised and non-subsidised rest home residents currently are charged the same amount in rest homes and that is not true. So whereas the explanatory note of the bill is trying to pretend that that is the case that is not true. I have rung a number of rest homes in the country today and it is clear that there is a difference between what Government subsidised residents are charged and what private paying residents are charged. There is a difference and as a number of rest home providers told me they subsidise the Government subsidised residents with the money that they have charged the private self-funding residents. 
So can members see the issue here? The issue is that in many rest homes Government-subsidised residents are charged about $636 on average each week but private self-funded rest home residents could be paying $100 extra or a bit more. Rest home providers use that extra amount being paid by the private payer to help subsidise overall services that benefit the Government-subsidised resident. But here is the problem. I do not think the Minister even realises this judging by the funny grin on his face. What the Minister does not realise is that he is going to price-fix those private paying residents. The private paying resident in a rest home is not a party to the contract the Government has with either the provider or the subsided resident. That resident is in no way associated with that contract but the Government is saying in this bill that it will regulate across the private contract and the rest home will not be able to charge any more than the Government rate. I do not know whether the Government actually understands the full implications of that and we would like the next Government speaker to address it. Does the Government actually realise that the private patients in rest homes now are paying more than the Government fee and that that surplus is being used to subsidise overall operations? 
Sandra Goudie 
: Helping our older people. 
Hon TONY RYALL 
: It is helping our older people. 
The effect of limiting the private charge is that the services and the viability of the rest homes will be put at risk. I do not think the Government fully appreciates what that will mean. It will mean that innovation will be stifled and even greater financial pressure will be put on the providers of services to some of our most vulnerable older people and that will happen because the whole economics of running a rest home will change. Rest homes are currently operated on the contribution of the private patients and the contribution that comes from the Government for the subsidised patients. If we cut back on one it makes it harder to spread the burden and make the rest homes viable. So this price control of private paying rest home patients will be bad for residential care and at the select committee we will be looking forward to understanding why the Government wants to do that. If the Government undermines the viability of the rest home sector there will be fewer places to deal with the most vulnerable in our community. 
One of the things that we in the National Party are very concerned about as we look out at our responsibilities over the next 20 years as policy makers in this country is the big shortfall there will be in providing rest home facilities. The fact is that the Government cannot shoulder the full cost of providing those services to retired New Zealanders and those who are in a position to make a contribution will have to do so. But we think that for Parliament to pass a law that will regulate what rest homes can charge their private paying patients will undermine viability of rest home care in New Zealand and stifle innovation. 
The Government has accepted I think in its overall changes that rest homes that provide additional services on top of the standard care regime can charge extra. That is why we are seeing around the country that even subsidised Government patients might be paying another $20 or $30 a week to get an en suite or something extra in their rooms. We do not want to change that. We think that is a way to ensure we have innovation and improving quality. But we are quite concerned about the suggestion that the Government regulate across the private contract of the private paying residents because that premium is being used to subsidise the Government-subsidised residents. It would be wrong and it would undermine the viability of rest homes to change that. 
We also want to make sure that the Government takes some time to explain—maybe in this debate—whether any change is proposed to the set-up of what is provided with the new definition in this bill for “contracted care services” in clause 6. What does that mean? There are some changes to contracted care services. We want to know what those changes mean—in particular paragraph (c): “in relation to a particular person the services necessary to meet the person’s assessed long-term residential care needs”. What does it mean to include that in the definition of “contracted care services” and what do the changes to the definition of “cost of contracted care services” mean? We asked for a briefing from the Government today and we were told no we could not have a briefing on this bill. 
Hon David Benson-Pope 
: You should have asked before lunch time. 
Hon TONY RYALL 
: We did ask before lunch time I say to the Minister. 
Hon David Benson-Pope 
: You did not. 
Hon TONY RYALL 
: We did ask before lunch time. We asked for a briefing by 9.30 and we got no—[ 
Interruption 
] Who do I believe? David Benson-Pope or myself? Well frankly I would believe myself hands down against David Benson-Pope. Would we believe David Benson-Pope—a man a prima facie case was found against? 
Hon David Benson-Pope 
: Be careful Tony. 
Hon TONY RYALL 
: You be careful Minister— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! 
Hon TONY RYALL 
: The fact is he cannot say in this House that things happened after midday when they did not. 
So we want a Government member to take the next call and explain to us those key issues. There are many things in this bill that we will support and facilitate the speedy progress of in the select committee. But I think it is clear that the Minister himself does not understand the implication of this. The Government is wrong if it thinks that rest homes currently charge their private paying patients the same level of subsidy that the Government pays. That is what this explanatory note says and it is not true. We want to be assured that the Government knows that is not true and that it knows it is planning to regulate the fees that private patients have negotiated with rest homes. It will have significant implications on the financial viability of a sector that is already under pressure and it will stifle innovation. 
The biggest issue facing Vote Health in the next 20 years is the ageing population and the care of our most vulnerable. We simply cannot expect that Government regulation will provide the places and the care that we need for our elderly. We need a much more imaginative and forward-looking approach in aged care rather than this narrow and managerialistic regulatory approach that the Government is looking at. In the next 6 months the National Party will be launching quite a discussion about how we get the services right and how we make sure that the rest home sector is expanded that home care is expanded and that we have the workforce the beds and the care for our most vulnerable. We do not think that can be done by Government regulating all the costs in rest homes. It will stifle innovation and undermine the financial viability of our rest home sector.