Commission reduces reliance on consultants after staggering rejection rate revealed

Greens Senator Janet Rice has heaped more criticism onto the Aged Care Quality and Safety Commission following confirmation that one-third of safety and quality audits conducted by external consultants were rejected because they did not meet Commission standards.

While the process of rejecting audits and reports is a common occurrence, including for internal jobs, it’s a costly revelation given roughly 350 aged care facilities were affected and over $40 million was paid to the consultancy firms.

The impact of conflicts of interest has also been a leading concern after it was revealed consultants reported over 520 real, potential or perceived conflicts of interest when auditing aged care providers.

The Guardian reported that Senator Rice was critical of Commissioner Janet Anderson for previously stating only “a small proportion” of audits were rejected before revealing the tally was closer to one-third.

“Anderson’s response to me that the problem only lay with a small proportion of the audits indicates an unacceptable ignorance of the problems that so often occur when sensitive and complex tasks are outsourced to for-profit providers,” Senator Rice said at a Senate Hearing Committee.

“This admission, as well as hundreds of reported conflicts of interest, is an illustration of what can go wrong when for-profit consultants are brought in to do a job that should be handled by Government.”

Commissioner Anderson has previously stated the consultancy firms, including KPMG, were being held to account to ensure they met appropriate standards. Brought in to assist in completing a backlog of audits delayed by the COVID-19 pandemic, KPMG, HDAA, SAI Global and RSM have been responsible for two-thirds of all aged care audits since 2021.

Commissioner Anderson has confirmed that external consultants are no longer being relied on as much with a decreased workload and that additional time ensured all reports were improved and accepted. 

“An audit report could be up to 100 pages or more in length, depending on the size and complexity of the service being audited and the observations made by the quality assessor team,” she said.

“When we refer to reports requiring additional work, it can include things like adding extra detail or clarification to an observation, changes to formatting or correcting typographical errors.”

With the Commission prioritising in-house resources over external consultants, it appears they are confident their capacity to complete audits has improved due to the reduced backlog.

This also leaves third-party consultants as a backup resource. Charles Maskell-Knight told The Guardian this would be a preferred alternative to audits not being conducted at all as consultants are still being held to high standards.

“If there is a choice between not doing audits at all due to staff shortages, or doing them using third parties, it is clearly in the interests of people receiving aged care that the audits are carried out, even if it is by consultants,” Maskell-Knight said.

“I am sure that the ACQSC will be making every effort to ensure it has the staff in-house to carry out its core functions and avoid the need to outsource the work, given the inherent risks of conflicts of interest and underperformance.”

Industry expert and former public servant, David Tune, recommended the Commission reduce its reliance on external consultants in an Independent Review released in 2023. He called on the Commission to actively work towards significantly increasing the number of site audits completed by its permanent workforce. He said this would also help to reduce the gap between fee revenue and costs incurred.