The second PASA aged care conference highlighted the importance of efficient and ethical procurement practices in developing a sustainable, people-focused aged care sector.

Autumn was almost over when the PASA conference opened in Melbourne on 24 May, 2016. It was cool and windy outside, but inside the function room at Melbourne Olympic Park, the coffee was brewed perfectly, there were more than 50 exhibitors and an adjoining room was filled with round tables ready for the numerous delegates. The conference promised an important overview of procurement practices in aged care in Australia.

Certainly, the mood was serious with the implications of the 3 May 2016/2017 Budget cuts (totalling $1.2 billion to aged care to be implemented over four years) beginning to weigh heavily on organisations transitioning to the Consumer Directed Care (CDC) model of service delivery. Greater flexibility and choice to those receiving care is central to CDC, which was introduced on July 1, 2015. The Minister for Aged Care, Sussan Ley has suggested a rating system “resembling TripAdvisor” to promote transparency and to offer those receiving care greater choice and higher quality at competitive (some say lower) prices. It was within this context that the PASA presenters offered their insights and lessons in contemporary procurement practices.

Over two days, 17 speakers discussed procurement across residential and in-home aged care for both for- and not-for-profit organisations. Broadly speaking, three main themes emerged: operational efficiencies and value, legal and ethical, and sustainable practices.

Operational efficiencies and value

Speakers such as Hugh Watson, Construction Principal, Moores, and Brett Beattie, Head of Procurement, Opal Specialist Aged Care, presented papers emphasising the importance of:

– understanding operational challenges
– having good systems in place
– consulting widely
– choosing the best procurement model
– clearly documenting the engagement.

Watson also highlighted the importance of getting the best out of your contracts. “Retaining ownership of your projects [will] help good procurement,” he said. To do this, contracts “need to be clear”. He also stated: “The risks of not referring to your contracts [could mean] losing your rights and entitlements.”

Legal and ethical

Russell Kennedy Lawyers representative, Liana Westcott’s presentation, Better practice in aged care procurement continued the legal theme and emphasised the ethical responsibilities in procurement practices.

Westcott was particularly interested in issues surrounding conflict of interest. “Even a hint of impropriety is enough to drive away potential providers,” she said. “The Commonwealth Government takes that risk very seriously. They take probity very seriously.”

So how can probity play a part in aged care? Westcott asked. She recommended the following:

– educate employees about conflict of interest
– look at probity risks
– educate employees about perception
– think about adopting some of the Commonwealth Government’s core procurement principles.

“Take probity seriously,” she said in closing, “and make it part of your organisational culture.”

Sustainable practices

Tania Crosbie’s paper offered a unique insight into sustainable procurement, which the Australian Department of Sustainability, Environment, Population and Communities says “…aims to reduce adverse environmental, social and economic impacts of purchased products and services throughout their life.”

Factors Crosbie highlighted:

– Environmental, including source, pollution and waste in the production, manufacturing, distribution, sales, use and end of life

– Social and ethical practices including employment opportunities for local and disadvantaged people, ethical and sustainable supply chains, and positive impacts on international labour conditions including human rights, child labour and human trafficking.

According to Crosbie’s research, the aged care sector is “largely just starting their sustainable procurement journey with little industry coordination or knowledge sharing.”

While the barriers were plentiful, Crosbie was positive about the future of sustainable procurement in the sector offering many tips for the future.

Crosbie suggested:

– a systematic approach which uses a sustainable procurement framework that includes price, quality and sustainable sourcing and performance
– establish sustainable guidelines for the industry, for all common products and use this to influence suppliers and process
– integrate sustainability across organisations.

The overwhelming message from the 2016 PASA conference was efficient, innovative and ethical procurement practices would help organisations offset some of the cuts to aged care funding while offering those receiving care greater choice and quality at competitive prices.

Image: iStock