But they like small lounge areas that feel like home, where you have a lounge and a couple of wing chairs and a TV. And that’s the way that we’re developing our aged care as well. So that there’s more recognition of people’s individual needs rather than just a collective group of people that have been put somewhere to finish off their days.
Michael Bailey: Walter, tell us about the providers and investors in aged care as they stand today.
Walter Secord: Of the 2087 aged care nursing homes in Australia, 63 per cent are single operators, where classically it’s the 1970s, a doctor marries a nurse and they decide to buy an aged care facility. The largest providers are usually mission based, such as Salvation Army, Uniting Church, the Baptists, the Anglicans with Blue Care in Queensland, the Catholics, all providing world class services.
And then you have the larger corporate-based providers. You have BUPA which is a British provider. They’re moving in and they’re buying up. A number of years ago you had Macquarie Bank move in. Westpac is moving in. AMP is there. Babcock and Brown Communities.
From our experience the larger investors are actually quite good because compared to the single operators, the larger providers have their overall reputation and their investors to worry about. Their investors do not want to be associated with someone who’s running a bad aged care facility. So when we have compliance issues, they are quicker to respond than the single operators because they do it large scale.
They’re able to bring in clinical staff. Now aged care in Australia is not homogeneous. You have pressure points. In Western Australia providers are having a particularly hard time getting staff, so it’s bringing in nurses from Africa and the Philippines. Last Friday, we set up a program of $300 million in zero interest loans for people wanting to set up aged care facilities, proven providers in areas of high need, and we designated the areas in Australia where there’s an aging population but there isn’t an aged care facility there.
And on March 20th this year we introduced a new instrument to give providers more funding if they’re dealing with dementia, Alzheimer’s, and what are called challenging behaviours – because with an aging population, people with psychiatric disorders also age.
Scott Marinchek: That was an impressive set of statistics and government initiatives. That certainly will be fuel for thought for us in the commercial sector as we look towards allocating our resources and looking at development and joint venture opportunities over the next few years.