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P PE U R

2017

State Office 85 Creek Road, New Town 7008

P o Box 8151 Moonah 7009

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(03) 14 9717 Fax (03) 627'8 9177

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Extract SCT.5002.0001.0018

.) I

Extract SCT.5002.0001.0018_0001

Southern Cross Care (Tas.) Inc. CariU.{::f flCmss 'Tasnwnfo

and

Mary's Grange Inc.

NOTICE OF MEETING

Board of Directors of Southern Cross Care (Tas) Incorporated and Mary's Grange Inc.

In the Nicklaus Room, Fairway Rise RACF on Monday 27th February 2017 to commence at 4.00 pm

AGENDA

1. Opening Prayer

2. Apologies

3. Declaration by Directors of any Conflict of Interest Arising out of Agenda Items

4. Acting Chairman's Opening Co:m:ments

5. Minutes of the Meeting held on 30 January 2017

6. Business Arising from Minutes

7. Correspondence

1

Outward 20

7 .1 Letter dated 31st January 2017 to Mrs Toni Maloney from the Chairman acknowledging the condolence letter for Mr Peter Patmore AM .

7.2 Letter dated 31st January 2017 to Dr Tony McCormack from the Chairman advising that the Southern Cross Care (Tas) Inc Board have accepted the tender from Darcon Builders to commence refurbishment of the Glenara Lakes Community Rooms.

7.3 Letter dated 31st January 2017 to Ms Cynthia Archer from the Chairman accepting the invitation to open the Art and Craft Exhibition in October 2017.

7.4 Letter dated 10th February 2017 to Ms Linda Gregoriou from the Chief Executive Officer confirming that the Southern Cross Care (Tas) Inc Board are not interested in selling the property 'She Oak Lodge' at 215-217 Low Head Road, Low Head.

7.5 Letter dated 10th February 2017 to Mr David Wallace, Wallace, Wilkinson and Webster from the Chief Executive Officer requesting that he provides an indication of legal costs for Technofloor Industria Chimca and Kenbrock Flooring Pty Ltd if Southern Cross Care (Tas) Inc were to proceed with court action.

7.6 Letter dated 2ist February 2017 to Ms Krystyna Anna Bishop, Bishop Barristers and Solicitors from the Chief Executive Officer acknowledging the bequest from the Estate of Cornelius Born late of Ainslie Nursing Home, Low Head,

7.7 Letter dated 161h February 2017 to Tasmanian Men's Shed Association Grants Programme from the Director of Retirement Villages and Property Management confirming the auspice of the grant application for $5000.00.

Extract SCT.5002.0001.0018_0002

7.9 Email dated lzth February 2017 from Dr Tony McCormack, President of the Glenara Lakes Residents Committee regarding naming of 'Peter Patmore Rooms'.

7 .10 Letter dated 14111 February 2017 from Mr Peter Imlach, Secretary of the Old Virgili ans Association (Inc) advising costs for the Centenary celebrations.

8. Executive Management Reports

8.1 Chief Executive Officer 8.2 Director Residential Business Services 8.3 Director Clinical Services 8.4 Director Community Care 8.5 Director of Retirement Villages and Property Management 8.6 ACFI Report and Presentation by Mr Andrew George-Gamlyn 8.7 Director of Finance

10. Budget & Finance Committee Report

10.1 Issues to be discussed from the meeting held on 201h February 2017.

11. Major Projects Committee Report

11.1 Issues to be discussed from the meeting held on 17th February 2017.

12. Site Reports

12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 12.10 12.11 12.12 12.13 12.14 12.15 12.16

Rosary Gardens (John Shelverton) Guilford Young Grove (Stephen Shirley) Sandown Apartment (Stephen Shirley) Yarnandoo (Brian Gallagher) Glenara Lakes (Alex MacAskill) Mount Esk (Alex MacAskill) Ainslie- Low Head (Alex MacAskill) Ainslie - Launceston* (Alex MacAskill) AA Lord Retirement Village (John Shelverton) Saint Canice Lifestyle Vi1Iage (Ray Groom) Sandown Village (Stephen Shirley) Guilford Young Grove I Taroona (Stephen Shirley) Fairway Rise RACF (Michael Mazengarb) Fairway Rise Lifestyle Village (Michael Mazengarb) Mary's Grange RACF Mary's Grange Villas

* When the Board Papers were finalised, a written report was not available for circulation. It is expected that a verbal or written report will be presented at the Meeting.

Board of Directors Meeting - Agenda 27 February 2017

Page2

30

58

85

89 90 91 92 93 94 95

96 97 98 99

100 103 104 105

13. GenernI Business

Extract SCT.5002.0001.0018_0003

106

13.1 Catholic Health Australia "Will the Current Aged Care Means Testing Arrangements Fit the Bill"

14.1 Meeting Calendar 14.2 List of Abbreviations

14. Board In Confidence Session if :required

15. Next Meeting

Monday, 27th March 2017 at Fairway Rise RACF in the Nicklaus Room commencing at 4.00pm.

16. Close and Prayer

DR HELEN MCARDLE Acting Chairman

Board of Directors Meeting - Agenda 27 February 2017

Page3

Extract SCT.5002.0001.0018_0004

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Extract SCT.5002.0001.0018_0005

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' I.",

Meeting of the Board of Directors of Southern Cross Care (Tas) Incorporated and Mary's Grange Inco:rpo:rated held at Fairway Rise Retirement Aged Ca:re Facility on

Monday, 30 January 2017, co:mmencing at 4.00pm

1 Present: R Groom (Chainnan), H McArdle (Deputy Chair), C Jones (Treasurer), B Gallagher, A MacAskill, M Mazengarb, B Gibson, B Court, M Hill.

J Shelverton :in attendance at 4.1 Spm

In Attendance: R Sadek (Chief Executive Officer), R Tyberek (Director of Retirement Villages and Property Management), A Crane (Director of Finance) in attendance at 5.30pm, C Odgers (Minute Secretary).

2 Apologies: J Mazengarb, S Shirley

3 Declaration by Directors of any Conflict of Interest Arising out of Agenda Items: Director Michael Hill advised that he is an acquaintance of both and Mr

on a social basis and was concerned that this maybe conflict of interest. The Chairman advised Mr Hill that this was not a concern and that his friendship with both would not :interfere in the Board. He thanked him for advis:ing the Board.

4 Opening Comments by Chairman: In open:ing the Meet:ing, the Chairman:

a) Acknowledged an apology from Director John Mazengarb who is presently unwell. The Chairman extended on behalf of the Board best wishes to him for a full recovery. Also acknowledged an apology was received from Director Stephen Shirley.

b) Remembered the former Chairman of Southern Cross Care (Tas) Inc Mr Peter Patmore AM who sadly passed away on 151

h December 2016. In recognition of Mr Patmore's legacy and devotion to Southern Cross Care (Tas) Inc and especially his :interest :in Glenara Lakes, the Chairman suggested that the new Community Rooms be named "The Peter Patmore Community Rooms". The Board agreed with this suggestion. The Chairman undertook to contact Mrs Maryanne Ingram, daughter of Mr Patmore and confirm that the family are happy for this to proceed. It was also noted that Mr Patmore's family have advised that they would like to donate one of Mr Patmore's pa:int:ings to Southern Cross Care (Tas) Inc. The Board agreed that the painting be displayed in the new Community Rooms.

1

Extract SCT.5002.0001.0018_0006

Director Michael Mazengarb mentioned that he would like to place an article on Mr Peter Patmore AM in the next edition of Under the Stars Magazine. The Board suggested that once all parties have agreed on the naming of the Community Rooms that this could form the article with reference to Mr Peter Patmore AM.

c) Acknowledged that this meeting would be Director, Brian Gibson's last meeting on the Board of Southern Cross Care (Tas) Inc and thanked him for his contribution and time over the last 12 months and in particular his support and efforts with the merger of Mary's Grange Inc.

5 Minutes of Meeting held on 28 November 2016:

Moved: Bobby Court. Seconded: Alex Macaskill.

That: The Minutes of the Meeting held on 28 November 2016 be confrrmed as a true and accurate record of discussions.

CARRIED

6 Business Arising:

No Matters Raised

7 Correspondence:

Outward

7.1 Senator the Hon Michaella Cash, Minister for Employment Circulated for infonnation was a copy of a letter dated 7th December 2016 from the Chief Executive Officer applying for a declaration which will allow Southern Cross Care (Tas) Inc and Mary's Grange Inc to bargain together pursuant to s.247 of the Fair Work Act.

7.2 Mr Tim Jacobson, Secretary- Health Services Union Circulated for information was a copy of a letter dated 13th December 2016 from the Chief Executive Officer providing an update on progress in relation to the negotiation of the proposed Southern Cross Care (Tas) Inc and Mary's Grange Inc Staff Enterprise Agreement 2017.

7.3 Ms Neroli Ellis, Branch Secretary-Australian Nursing and Midwifery Association Circulated for information was a copy of a letter dated 131

h December 2016 :from the Chief Executive Officer advising that Southern Cross Care (Tas) Inc had begun the process of seeking a Ministerial Declaration in accordance with the Fair Work Act.

7.4 Ms Joanne McEvoy - HACSU Circulated for information was a copy of a 1etter dated 13•h December 2016 from the Chief Executive Officer advising that Southern Cross Care (Tas) Inc had begun the process of seeking a Ministerial Declaration in accordance with the Fair Work Act.

Minutes - Board Meeting 30 January 2017

2 Page2

Extract SCT.5002.0001.0018_0007

7.5 - residents St Canice Lifestyle Village Circulated for information was a copy of a letter dated 30th December 2016 :from the Chief Executive Officer acknowledging a letter :from the Manton's dated the 26th November 2016 regarding the imposition of the General Rate.

7.6 Residents of Saint Canice, Guilford Young Grove, Sandown, A A Lord West Hobart and Taroona Villa's Circulated for information was a copy of a letter dated 121

h January 2017 by the Director of Retirement Villages and Property Management outlining the process associated with the claiming of the Pensioner Rate Remission for 2016/17 through Hobart City Council.

7.7 Residents of Fairway Rise Lifestyle Village Circulated for infonnation was a copy of a letter dated 12111 January 2017 by the Director of Retirement Villages and Property Management outlining the process associated with the claiming of the Pensioner Rate Remission for 2016/17 through Clarence City Council.

7.8 Residents of Saint Canice, Gu:ilfo:rd Young Grove, Sandown, A A Lord West Hobart and Fairway Rise Lifestyle Village Circulated for information was a copy of a letter dated l 61

h January 2017 from the Director ofRetirement Villages and Property Management advising residents of their share of the Rates and Taxes that they will be charged.

7 .9 Mr David Wallace, Lawyer - Wallace, Wilkinson and Webster Circulated for information was a copy of a letter dated l 71

h January 2017 from the Chief Executive Officer in the relation to the Kenbrock carpet liability claim enclosing further financial information extracted from Southem Cross Care (Tas) Inc accounting system

Inward

7.10 - Residents St Canice Lifestyle Village Circulated for information was a copy of a letter dated 261

h November 2016 raising concerns over the imposition of the General Rate and suggesting some payment options.

7.U Bishops Barrister and Solicitors- Estate of Circulated for information was a copy of a letter dated 29th November 2016 in regards to the late resident Ainslie Nursing Home advising that the deceased's last will and Testament stated that a bequest of $100,052.20 be applied towards the Low Head Facility. The Chief Executive Officer was asked to acknowledge receipt of this letter and bequest.

7.12 Mr Greg van Mourik, Cb.airman- Southern Cross Care (Vic) Circulated for information was a copy of a letter dated 19th December 2016 advising that SCC(V) and Mercy Health have agreed to explore a possible merger. The Chairman advised that since receiving this letter that Mr Greg van Mourik: had resigned as Chainnan from Southem Cross Care (Vic).


3 Page 3

7.13 - Resident Glenara Lakes

Extract SCT.5002.0001.0018_0008

Circulated for infonnation was a copy of a letter dated 20111 December 2016 to the Chairman on behalf of the 'older' residents expressing their deep sorrow on the passing of SCC former Chairman, Mr Peter Patmore AM. The Chairman undertook to reply to

acknowledging her letter and advising her that he personally passed the condolence letter on to Mr Patmore's family.

7.14 Senator the Hon Michaella Cash, Minister for Employment- Parliament House, Canberra. Circulated for infonnation was a copy of a letter dated 201

h December 2016 advising that Southern Cross Care (Tas) Inc and Mary's Grange Inc had been granted a single interest employer declaration under section 247 of the Fair Work Act 2009 to bargain together for a proposed enterprise agreement.

7.15 Ms Joanne McEvoy, Lead Organiser - HACSU Circulated for infonnation was a copy of a letter dated 22nd December 2016 regarding the commencement ofbarga:ining for a new Southern Cross Care (Tas) Inc Enterprise Agreement.

7.16 Deputy President \\Tells - FairWork Commission Circulated for information was a copy of the Decision dated l oth January 2017 outlining s.28 - Single Interest Employer Authorisation. To allow bargaining to commence from 101h January, 2017.

7.17 -Resident A A West Hobart Circulated for information was a copy of a letter received on 12th January 2017 regarding the financial imposition of a General Rate on residents.

7.18 -Resident A A Lord West Hobart Circulated for information was a letter dated 12th January 2017 regarding the imposition of a General Rate and Hardship consequences.

7.19 - Residents St Canke Lifestyle Village Circulated for information was a copy of a letter dated 5th January 2017 expressing further concerns associated with the imposition of a General Rate.

7.20 -She Oak Lodge, 215-217 Low Head Road, Low Head Circulated for information was a letter dated 121

h January 2017 expressing interest in purchasing She Oak Lodge as a private individual.

7.21 - Residents St Canice Lifestyle Village Circulated for information was a copy of a letter dated 1 ih January 2017 expressing further concerns associated with the imposition of a General Rate.

7.22 -re••••••• Circulated for information was a copy of an email sent 17th January 2017 concerning the imposition of the general rate and financial hardship for her mother in Unit 18, 100 Channel Highway, Taroona.


4 Page4

Extract SCT.5002.0001.0018_0009

Moved: Chris Jones. Seconded: Michael Mazengarb.

That: The Outward Correspondence be endorsed and the Inward Correspondence received.

CARRIED

9 Board Governance and Remuneration - Minutes of 13t1i December, 2016

TI1e Chairman advised that at the meeting held on the 13th December 2016 he had recently held discussions with Director Brian Gibson concerning governance suggestions for the operation of the Southern Cross Care (Tas) Inc Board. Resulting from that discussion the Chairman requested that Brian prepare a report stating hls views and concerns.

The Chairman also advised that at the meeting held on the 13th December 2016 a review of salaries for Executive, Facility Managers, contract and permanent staff not covered by the Southern Cross Care (Tas) Inc Staff Enterprise Agreement 2014 was reviewed. It was agreed as per the Chief Executive Officers recommendation that a 3% increase be approved with effect from the first full pay period on and from 1 si July 2016.

It was also noted that the following Executive Directors be granted contract of employment extensions:

.:Mrs Pauline Robson-Director of Residential Business Services 3-year tenn effective l61

h December 2016.

Mr Richard Tyberek- Director of Retirement Villages and Property Management 3-year tenn effective 9th March 2017.

Mr Andrew Crane - Director of Finance 3-year term expiring on 4th April 2019.

It was noted the Chief Executive Officers contract expired on the 31 51 January 2017. He was requested to undertake a performance appraisal which was undertaken by the Chairman and Deputy Chair, Dr Helen McArdle on the 191

h January 2017.

The Committee discussed the need to undertake a process for succession planning for Executive Management and some Facility Managers. The Chief Executive Officer was requested to obtain the best advice available on an approach to undertake a succession plan for Senior Management staff.

The Chief Executive Officer reported that negotiations had not been c01mnenced with ANMF and HACSU concerning the development ofa new combined Southern Cross Care (Tas) Inc and Mary's Grange lnc Enterprise Agreement due to an approval not being received for a Single Interest Agreement which had been lodged with the Minister for Employment, Senator the Honourable Michaela Cash. ]t is expected that thls approval will be forthcoming in January 2017.


5 Page 5

Extract SCT.5002.0001.0018_0010

The Chief Executive Officer also stated that he was awaiting a report from Mr Andrew GeorgeGamlyn, ACFI Manager indicating the financial implications associated with the recent ACFI rule changes to be introduced by the Government from 1st January 2017.

The Chainnan noted that Mary's Grange 601h Anniversary was being held on 17th March 2017.

He advised that unfortunately he will be an apology and has asked that the Deputy Chair and Directors attend the anniversary if available.

Director Michael Mazengarb commented that he would be attending and would arrange a feature article to be published in the Under the Stars Magazine.

Minutes of Meeting held on 13 December 2016:

Moved: Ray Groom. Seconded: Chris Jones.

That: The Minutes of the Meeting held on 13 December 2016 be confirmed as a true and accurate record of discussions.

CARRIED

Minutes of 23rd January, 2017

The Chairman requested that a Board in Confidence meeti.-1.g be held to discuss the Chief Executive Officers contract. The Chief Executive Officer, Director of Retirement Villages and Property Management and the Minutes Secretary exited the Board Meeting.

The Chairman reported to the Chief Executive Officer that the Board had agreed with the decision of the Chainnan and Deputy Cha:ir to extend bis contract for a :further 3-year period to the 5th February 2020 and congratulated him on his hard work, commitment and dedication to Southern Cross Care (Tas) Inc over the past 20 years. The Chief Executive Officer acknowledged his kind comments and extended his gratitude to the Chairman and Directors of the Board.

Director Bobby Court suggested that it would be appropriate for the Chief Executive Officer to start collating information and documenting bis role and responsibilities, explaining in detail all aspects of the position. It was acknowledged that this task may involve assistance and support from an internal person. This would enable continuity for the next person appointed as Chief Executive Officer.

It was also noted that on request from the Chairman he had received a letter from Director Brian Gibson providing a summary of suggestions for the Board and its workings. The Chainnan acknowledged these points and noted that the suggestions that were put forward by Director Brian Gibson were very much similar to the suggestions raised from a meeting held on the 241

h

March 2009. The Chainnan agreed to prepare a paper on each of the issues in Brian Gibson's paper for discussion at a future Committee Meeting.


6 Page 6

Extract SCT.5002.0001.0018_0011

The Chairman also mentioned that a decision had been made that the Chairman of each Board Committee should only highlight key issues and not speak to every matter that was discussed at Committee Meeting. It was also agreed that the Director ofFmance, Mr Andrew Crane attend every Board Meeting to present his Fmance Report and that the Treasurer would report on the important issues arismg from the minutes of the monthly Budget and Finance Committee.

The Chief Executive Officer confinned that Senator the Honourable Michaella Cash had recently provided approval for both Southern Cross Care (Tas) Inc and Mary's Grange Inc to begm bargaining for a proposed new Enterprise Agreement and that the Fair Work Commission had approved an application for a Single Interest Employer Authorisation for a proposed 2017 Enterprise Agreement.

The Chainnan confinned that he would be taklng leave of absence from the Board commencing 31st January 2017 to the 201

h March 2017 and indicated that Deputy Chairman, Dr Helen McArdle would act as Chairman during the period.

Minutes of Meeting held on 23 January 2017:

Moved: Ray Groom. Seconded: Helen McA:rdle.

That: The Minutes of the Meeting held on 23 J amm:ry 2017 be confirmed as a true and accurate record of discussions.

CARRIED

10 Executive Management Reports:

Chief Executive Officer

The Chief Executive Officer provided an overview of the key issues referred to in his written report. The Board noted the report as read.

The key issue of discussion in the Chief Executive Officer report were as follows:

10.1 Retirement Village Development Opportunity - 'Lowestoft', Berriedale The Chief Executive Officer advised that to date he had not received any communication from Mr and Mrs McKay regarding their intention to sell the property and advised that he would not be pursing the matter.

10.2 Update on Kenbrock Carpet Issue The Chief Executive Officer advised that copies of paid invoices for the purchase and laying of the Kenbrock carpet were forwarded to Mr David Wallace of Wallace, Wilkinson and Webster Lawyers and noted that the legal costs to date paid were $6,544.67.

It was requested that the Chief Executive Officer ask Mr Wallace for an indication of likely legal costs associated with progressing this case.


7 Page 7

10.3 Advertising Strategy - Comm.unity Care

Extract SCT.5002.0001.0018_0012

The Chief Executive Officer advised that he has arranged a further meeting with Mrs Jill Savell, Director of Community Care, Glenn Phair and Rowan Smith both :from Integral Communications on Thursday 2nd February 2016. A report will be provided for discussion at the February Board Meeting.

10.4 Renegotiation of Southern Cross Care (Tas) Inc and Mary's Grange Staff Enterprise Agreement The Chief Executive Officer advised that apart :from the correspondence that had been provided in the Board papers an Introductory Meeting had been arranged for the 2na of February 2017 with delegates from both ANMF and HACSU Unions and their representatives. It is expected that this meeting will address the future bargaining meeting procedures. He also advised that Southern Cross Care (Tas) Inc had only received ANMF's Community Care's log of claims on (this day) the 301

h January 2017. The Chief Executive Officer confirmed that negotiations will formerly commence on the 2nd March 2017. He advised that by the next Board Meeting date Management would be in a position to recommend to the Governance and Remuneration Committee and the Board a proposed wage and conditions offer. The Chlef Executive Officer advised that both HACSU and ANMF log of claim indicates a wage increase of 4.5% with some variations to award conditions.

The Chief Executive Offer also informed the Board that at the last Budget and Finance Meeting held on 161

h January 2017 it was agreed that the wages currently being paid at Mary's Grange be increased to equal that.of Southern Cross Care (Tas) Inc. The calculation of this payout is estimated at $257,000.00. Treasurer Chris Jones commented that at present Southern Cross Care (Tas) Inc is running two pay roll systems which is costly. Director Brian Gallagher also commented that if the adjustment of pay between Southern Cross Care (Tas) Inc and Mary's Grange Inc was not aligned he could foresee issues with staff being paid if they chose to transfer from one facility to another.

The Chief Executive Officer referred back to the Enterprise Agreement and stated that Southern Cross Care (Tas) Inc. Management were looking to offer a 1.5% pay :increase based on the current national CPI rate. This will calculate to an additional $460,000.00 inclusive for both Southern Cross Care (Tas) Inc and Mary's Grange Inc. This figure does not :include the $257,000.00 for Mary's Grange Inc staff to enable salary parity.

The ChlefExecutive Officer also made reference to Mr Andrew George-Gamlyn, ACFI Manager reports on page 92 and 93 of the Board papers wherein he provided estimates of the impact of ACFI changes to rule 12. It was noted in the 'New Rules Modelling' chart that when the full impact of ACFI item 12 is in place it is estimated that there will be a decrease ofbetween $3.00 - $6.00 per day per resident which is a considerable loss in revenue that will need to be made up from efficiencies. Mr George-Garnlyn had also indicated in his report on page 93 that 'a gross annualised 'actual dollar' income reduction, when the new rules are applied to all residents of approximately S2 million or 5% of total ACFI :income'.


8 Page 8

Extract SCT.5002.0001.0018_0013

The Chairman requested that the Chief Executive Officer advise Mr Andrew GeorgeGarnlyn that he provide a clear paper clarifying the impact of ACFI rule 12 changes and how residents are rated for presentation by him to the Board at the February meeting. The Chairman stated until the ACFI impact is detemrined it would be very difficult for the Board to approve a wage increase.

10.5 Imposition of General Rates on Retirement Villages The Chief Executive Officer advised that a lot of work has been undertaken by the Chairman and hirnselfin providing requested information to Southern Cross Care (Tas) Inc instructing lawyer, Mr Marc Edwards of Page Seager Lawyers, in preparation for the legal case to be heard on the z3r<l and 241

h of May, 2017. The Chairman made reference to a similar decision that has recently been heard in the Supreme Court of Western Australia. It was agreed that the citation be forwarded to Director Michael Hill for review.

The Chief Executive Officer advised that Mr McElwain will be representing Westbury and Clarence Council's. Mr McElwain has requested a lot ofinfonnation including 'samples' of resident agreements. It was advised Mr David Morris will be representing Hobart and Kingborough Councils. A second Directions Hearing will be heard on the 7th

March 2017 before Magistrate Mollard.

The Chief Executive Officer confirmed that all the residents have been kept informed by regular letters and meetings. He also mentioned that he had received three letters of hardship from residents. It was re.solved that hardship requests be treated confidentially on an individual basis. It i.vas also agreed that a standard financial hardship criteria be developed to assess any financial hardship applications that are submitted. If financial relief is granted all arrangements are to be documented and retained in the resident's files.

Director of Residential Business Services (DRBS) Report

The Board noted the report as read.

Treasurer Chris Jones commented on a very good report being provided.

Director Clinical Services (DCS) Report

The key issues noted in the Director of Clinical Services report was as follows:

Yaraandoo resident death reported to the Coroner -1Vargaret Bugg

The Chairman acknowledged the additional information provided by the DCS but still expressed concem that Southern Cross Care (Tas) Inc may be liable for contributing to the death if staff failed to use the correct lifting equipment. He also enquired if Southern Cross Care (Tas) Inc had received copies of the statements that were provided to the police from staff. He suggested that if copies of statements haven't been received copies should be requested. The Chairman also asked that the Chief Executive Officer keep a watching brief on this important matter.


9 Page9

Health and Well Being Programme

Extract SCT.5002.0001.0018_0014

The DCS provided a paper to the Board outlining the programmes that are cunently available state-wide for residents, clients and staff. It was noted the programs for staff and ILU residents are self-driven and the programs for residential care are tailored to meet resident needs within available resource level. The Chairman requested that the Chief Executive Officer contact Mr Dean Ewington, Director Oceania Fitness and discuss what services his facility could offer to enhance the health and wellbeing of Southern Cross Care (Tas) Inc. for residents and staff.

Director Brian Gallagher also suggested that Mr Ewington and the Human Resources Officer, Ms Jenny Thomas visit SCC facilities and gather some feedback from staff, clients and residents which may assist in building a programme.

Deputy Chair Helen McArdle suggested that this matter be discussed and more infonnation provided to an Audit and Risk Meeting.

Donations Policy The DCS provided a draft Donations policy for review. It was agreed that the policy needed further refinement and will need to be reviewed by the Governance and Remuneration Committee and then presented back to the Board for approval.

The Board noted the remainder of the report as read.

Director of Home Care (DHC) Report

The Board noted the report as read.

Director of Retirement Villages and Property Management (DRVPM) Report

The key issues discussed in the Director of Retirement Villages and Property Management (DRVPM) report were as follows:

Alzheimer's Tenancy Arrangement DRVPM advised that the lease and rental of Alzheimer's Australia situated at 85 Creek Road, New Town had been reviewed with a current lease of3 years with option ofrenewal for a further 3 years. The rent currently is $500.00 per week until the 1st July 2017, after which the rent will increase to S 1000. 00 per week and further to $1040. 00 per week from 1st July 2018. Thereafter rent will be subject to CPL

Workers Compensation DRVPM noted that the claims for 2014/15 for Mary's Grange Inc was below the threshold which enabled a 'claims experience discmmt' to be reimbursed totalling $65, 711.94. This full amount will be paid direct to the Mary's Grange Inc bank account.

Update on Projects

The DRVPM provided a brief overview of various projects covered in his report.

The Chairman made reference to Item (b) on page 72 in regard to the proposal to build an additional 20 Independent Living Units at Glenara Lakes.


10 Page 10

Extract SCT.5002.0001.0018_0015

His major concern with this proposal was that it would be a huge workload and would stretch the resources of Southern Cross Care (Tas) Inc, to physically be able to manage this project. Director Brian Gallagher also mentioned that this project was not discussed or taken into account for the 2016117 budget which has already been confinned. The Chain.nan confirmed that a submission will be presented to the Board at the February Board meeting for consideration. If this project is agreed to by the Board it will need to be budgeted in the 2017/18 budget estimates.

Director Brian Gallagher made reference to Item (c) on page 72 in regard to the installation of traffic lights at Hill Street, West Hobart. The Chairman requested that the DRVPM report on the progress of this matter at the February Board meeting.

Director Brian Gallagher made reference to Low Head Bowls Club and enquired as to whether Southern Cross Care (Tas) Inc name is included on any lease? DRVPM undertook to confinn these details.


Operational Performance Review The Chief Executive Officer advised that the report had been updated to reflect current status.

Director of Finance (DoF) Report

The Director of Finance provided an overview of the key issues referred to in his written report. The Board noted the report as read.

The key issue of discussion in the Director of Finance report was as follows:

The half year surplus is $1.429M against Budget target of$L415M ($14k favourable) The $1.429M is made up of contributions from - Residential $574,518; Home Care $258,571; ILU's $301,008; Catering $82,962 and Corporate $212,122.

The DoF advised that it should be noted that over half the $1.429M half year surplus occurred in December 2016 but is possibly overstated by $130k due to late invoices being received for processmg.

The DoF provided a brief overview of half yearly financial performances as follows:

Rosary Gardens - favourable to Budget due to higher thfu1 estimated occupancy; greater improvement in ACFI, unfortunately the budget did not include the recent roster changes.

Guilford Young Grove- has a higher occupancy than budgeted and an :improvement in ACFL

Fairway Rise and Yaraandoo - Master Rosters have not been regularly monitored. This has now been addressed and improved management arrangements have been implemented.

Sandown, Ainslie and Mount Esk- all facilities have had occupancy issues. Ainslie also had staffing issues resulting in increased use of Agency staff which were not costed into the 2016/17 budget.


1 1 Page 11

Extract SCT.5002.0001.0018_0016

Catering- deliberate challenge to outperform budget through improved supplier pricing, which will then be dispersed to facilities.

Corporate- dominant factor is mterest on investments being $179,000 favourable to budget due to improved cash management and higher cash available to invest than included in budget estimate.

The DoF mentioned that if Southern Cross Care (Tas) Inc achieved a 'break-even' operating strategy in Residential and ILU's it would see an on-going $5M surplus.

Impact ofGovemmentACFI changes

The DoF advised that the report from ACFI Manager, I:\.1J' Andrew George-Gamlyn provided indicated an impact range on ACFI income ofbetween $I .3M and $2.8M. The DoF noted that this constmct was all that the ACFI Manager could provide as the data was not available and would require a review of the whole resident population. The DoF indicated he was confident in suggesting the worst case of$2.8M would not occur as it did not take into account time and resident discharges.

The DoF advised that the financial impact on Southern Cross Care (Tas) Inc of these rule changes will be minimal for the remainder of FY2017 and it would be reasonable to assume the result would be around $1M in FY2018 including indexation but excluding higher costs for pain management which bas been estimated at $400K.

The DoF stated that the critical point is that Southern Cross Care (Tas) Inc. must move to break-even which will provide on-going $5M from Residential Services and in doing so must accommodate the more difficult ACFI rules.

Moved: Chris Jones. Seconded: Brian Gallagher.

That: The Executive Management Reports be received. as presented.

CARRIED

11 Budget & Finance Committee Report:

The Committee Chairman provided an overview of issues covered in the Minutes of the Meeting held on the 161

h January 2017. Key issues referred to were as follows:

Residential Results July - Dec 2016 · The Treasurer provided a detailed by div1sion half year review of Southern Cross Care (Tas) Inc financial performance. The analysis indicated that in December Glenara Lakes; Mount Esk; Ainslie Low Head and Fairway Rise achieved operating surplus. Yaraandoo was dose to break-even, and Rosary Gardens and Guilford Young Grove had shown significant improvement. Unfurtunately, Sandown was under performing due to the closure of beds during construction and an over run in staff costs.


12 Page 12

Extract SCT.5002.0001.0018_0017

The analysis also :indicated that for the 6 months to 31December2016 that there was no one site that did not rely on non - operating income to record a surplus.

It was also noted that this analysis supported the break-even strategy being adopted and that there has been significant financial improvement.

Treasurer stated that December 2016 surplus was significantly inconsistent to the trend line due to the one-off donation of $103K and the possible impact of December expenses not be:ing processed in time for the Board report.


Moved: Chris Jones. Seconded: Brian Gallaghe:r

That: The Budget & Finance Committee Reports for Southern Cross Care (Tas) Inc and Mary's Grange be received as presented.

CARRIED

10 Major Projects Committee:

In the absenpe of Director Stephen Shirley, the Chairman provided an overview of issues covered in the Minutes ofthe Meet:ing held on 201

h January 2017.

The main issues discussed were as fullows:

Springhaven The Chief Executive Officer was requested to follow up progress with Mr Patrick Stanton on a cost report being provided.

Rosary Gardens The Chief Executive Officer advised that a tender site visit had been arranged on Tuesday 31st January 2017 for invited tenderers.

Guilford Young Grove The Chairman advised that tenders for this redevelopment closed on the 9th December 2016. Mr Patrick Stanton (SMG) has recommended TasCon Constructions be awarded the tender.

:Moved: Ray Groom. Seconded: Bobby Court

That: The tender from TasCon Constructions for $1,829,960.00 exclusive of GST be approved by the Board.

CARRIED

Minutes - Board Meeting 30January 2017

Page 13

13

Sandown

Extract SCT.5002.0001.0018_0018

This project was well advanced with expected completion on 31st March 2017. Treasurer Chris Jones requested that a Board inspection be arranged prior to handover by the builder.

Glenara Lakes Homestead - Stage 2 Refurbishment of existing Community Rooms Darcon Builders provided a tender of$469,367.00 excluding GST for this stage of the overall works. It was considered that both the builder and architect/project manager had performing to an acceptable level and that Stage 2 should proceed.

Moved: John Shelve:rton. Seconded: Michael Mazengarb

That: As the builder and architect/pro,ject manager are performing to an acceptable level the Board approves that stage 2 proceeds at the tender sum of $469,367 excluding GST. The builder and architect/project manager are to be informed of the Boards decision following this Board meeting.

CARRIED

She Oak Cottage Redevelopment - Low Head

The Chairman advised that since work had commenq:d on this renovation, Southern Cross Care (Tas) Inc has received an offer to purchase the two cottages from a holiday rental operator for a sum in the high $200,000.00. The operator intended to historically restore the cottages and requested that the current works be ceased. l\'foved: Chris Jones. Seconded: Brian Gallagher.

That: The decision to refurbish the cottages and offer them as ILU's remain. The prospective purchase would be informed that sec is not presently interested in selling the property.

CARRIED

Moved~ Ray Groom. Seconded: Michael Hill.

That: The Major Projects Committee Report be received as presented.

CARRIED The Chief Executive Officer to inform Ms Linda Gregoriou in writing of the Boards decision.

Minutes - Board Meeting 30January 2017

14 Page 14

11 Audit & Risk Committee Report:

Extract SCT.5002.0001.0018_0019

The Committee Chairman provided an overview ofissues covered in the Minutes of the Meeting held on the 121

h November 2016. Key issues referred to were as follows:

General Insurance Resolved to appoint A J Gallagher as brokers for the next two years for Southern Cross Care (Tas) Inc and Mary's Grange Inc.

Risk Management Review Advised that Mr Graham Marshall, Managing Director of Risk Management and Compliance Advisory Services (RiskComply) has been engaged to assist with the development of a simple and cost effective system for Southern Cross Care (Tas) Inc. When the specification has been received from Mr Marshall the project would go out to tender to 3 - 4 software companies.

New Website Confirmed that Ionata Digital have been engaged to build a new website for Southern Cross Care (T as) Inc.

Regulatory Compliance Checklist Confinned that this report is a standard agenda item at every meeting and is currently up to date. It was requested that this report be :included :in the Board papers following future Audit and Risk Meetings.

Intemal Controls Audit Review of the current Delegations Schedule to be undertaken :in February 2017. The Chairman noted that she is still awaiting :information to be provided from Alison Flakemore, Accountant, Crowe Horwath in relation to their recommendation for stage two of the Audit.

Risk Assessment Provided to the Board was a report from Arthur J Gallagher who had undertaken a desktop review of Southern Cross Care (Tas) Safety Management system. It was noted that Southern Cross Care (Tas) Inc maintained a safe work environment. The Chairman advised that this report would be reviewed and discussed :in the next Audit and Risk Meeti11g.

Quality Performance System Noted that the main issue raised was the high rate of pressure injuries recorded at Rosary Gardens. The Director of Clinical Services had explained that this was due to varied reasons including level of staffing required for an individual resident and the high level of'end oflife' care required. This matter will be monitored and discussed at the next Audit and Risk meeting.


15 Page 15

Complaints Register

Extract SCT.5002.0001.0018_0020

Noted that a spate of complaints had been received. These had all been discussed at the Audit and Risk meeting. Unfortunately, the majority involve dysfunctional families and require the assistance of Southern Cross Care (Tas) Inc to help resolve or provide information to settle matters.

Moved: Helen McArdle Seconded: Alex MacAskill That: The Audit & Risk Committee Report for Southern Cross Care (Tas) Inc be received as presented.

CARRIED

12 Site Reports:

Written site reports as included with the Board Papers in respect to Rosary Gardens, Guilford Young Grove (RACF and ILUs), Sandown (Apartments and Village), Yaraandoo, Glenara Lakes, Mount Esk, Ainslie Low Head, AA Lord, Saint Can.ice, Fairway Rise (RACF and Village) and Mary's Grange were taken as read. Key issues refened to were as follows:

Yaraandoo- Director Brian Gallagher noted that there is a concern with one resident who has severe behaviour issues. The Chief Executive undertook to discuss this matter with the Director of Clinical Services, Ms Carolyn Wallace.

Glenara Lakes - Director Alex MacAskill advised that there had been an additional 4 deaths since the report had been written and that the Geothermal Heating in resident rooms is starting to break down. The Chairman advised that the heating needs to be rectified and has requested the DRVPM to investigate alternative options and costs.

Mount Esk-Director Brian Gallagher questioned whether the 'Work for the Dole' programme if the participant/shave a current police check? The Director of Retirement Villages and Property Maintenance advised that 'yes' it is a requirement of the programme that all participants satisfy the requirement of a police check as per any person working in aged care.

Saint Canice- The Chairman noted the ongoing leaks in apartment 64. The DRVPM Officer to follow up.

Sandown Village - Director Bobby Court complemented the staff at Sandown on their friendly and pleasant manner that was received from a recent visit to the facility.

Fairway Rise RA CF-The Chief Executive Officer to discuss the relocation of the sculpture at the front entrance of the RACF with the Director of Residential Business Services.

The Chief Executive Officer also undertook to clarify with the Village and Sales Coordinator, Mrs Carol Joseph the access to the Bunker for residents in the RACF and confirm this with Ms MandyWoodorth, Facility Manager.

Minures - Board Meeting 30January 2017

16 Page 16

Extract SCT.5002.0001.0018_0021

13 General Business -Noted the change of meeting dates for April to the 1st May 2017 in the calendar.

14 Board in Confidence Session if :required - not required

15 Next Meeting:

To be held on Monday, 27th February 2017 at 4.00pm.

Meeting Closed: 7 .50pm

RAY GROOM Chairman


17

Date

Page 17

!

'llmir°d' · Meeting· Boar.cl' t{:eference

Date -- -

29 Key Acts of August Parliaments (page6 2016 item 8.2)

24 Sept DoF report - Site 2016 Rosters (page 9)

28Nov 2016 DoF Report (pg 6)

28Nov Major Projects

2016 Committee (pg 10)

30 Jan 2017 Inward

Correspondence (pg 3) Bishops Barristers and Solicitors

30 Jan Board Governance

2017 and Remuneration (pg 5)

30 Jan Board Governance 2017 and Remuneration

(pg 6) 30 Jan 2017 CEO's Report

(Kenbrock Carpet Cla:impg 7)

30 Jan CEO's Report 2017 (Advertising Strategy

l pg 8) i

30 Jan 2017 CEO's Report

(Enterprise Agreement pg 8)

30 Jan l Director Clinical 2017

Services Report (pg 10)

Minutes---- Board Meeting 30 January 2017

ACTION LIST

• Action, Item ' ··-·· -- -

Determine which Acts are relevant to SCC Board and provide a summary for the "Directors Handbook'

Reconciling site roster to reflect actual hours worked.

Clarification required on opening paragraph of report relating to operating result and budget variance.

Chairman Stephen Shirley to prepare a further report regarding the proposal to build an additional 20 villa's at Glenara Lakes and to provide a copy of the DRVPM proposal.

CEO ~eceipt of letter and bequest from the lat

CEO to obtain advice for a succession plan for Senior Management

Chairman to prepare a paper on each of the issues raised in Brian Gibson's paper for discussion at a future Committee Meeting

CEO to write to Mr David Wallace for an indication on legal cost for the Kenbrock Carpet Issue

CEO to provide report on meeting held 2nd Feb 2017 with Glenn Phair and Rowan Smith re Community Care

CEO to advise Andrew George - Gamlyn that he is required to prepare a paper of ACF! Rule 12 and a presentation

Health and Well Being. CEO to arrange a meeting with Dean Ewington. This Agenda Item now referred to Audit and Risk Committee

18

'

'

Extract SCT.5002.0001.0018_0022

.. -·-',

Per.son Sfat:us '.Responsible .I

-····· -- ·-····- ·-·.

Carried DCS

forward

Dof WIP

Report for DoF January

Meeting Report for

Stephen February Board

Shirley Meeting

Include copy of

CEO letter in Feb Correspond ence

Report for

CEO February Meeting

Chairman WIP

Provide copy of

CEO letter in Feb Correspond ence Provide report for

CEO Feb Board meeting Provide report and

CEO presentation at the Feb Board meeting Provide a

CEO report at the

I Feb Board meeting.

Page 18

I ' ' i

i

l

30 Jan ' 2017

Director Clinical Services Report (pg 10)

30 Jan 2017

DRVPM Report (pg 11)

30 Jan 2017

Major Projects Committee (pg I 3)

30Jan 2017

Major Projects Committee (pg 14)

30 Jan 2017 Site Reports

(Y araandoo pg 16)

30 Jan Site Reports 2017 (Glenara Lakes pg 16)

30 Jan 2017 Site Reports (Saint

Canice pg 16)

30Jan 2017 Site Reports (F\VR

pg 16)


Donations Policy - This Agenda Item now referred to Governance and Remuneration Committee

Progress Report on the traffic light situation at West Hobart (issue dates back to Board Meeting 24 Sept 2016)

Springhaven progress on cost report from Patrick Stanton

CEO to write to Ms Linda Gregoriou re She Oak Cottage

CEO to discuss with DC S resident behaviour issues

DR VPM to investigate heating options

DR VPM to confmn resident in unit 64

CEO to discuss with Carol Joseph and Mandy Woodorth the use of the "Bunker" and also discuss the sculpture at the front entrance of the RACF

19

I

Extract SCT.5002.0001.0018_0023

To next scheduled Governance CEO and Remunerati on Meeting Provide a report at the

DRVPM Feb Board meeting

Provide a report at the

CEO Feb Board meeting

Provide copy of

CEO letter in Feb Correspond ence Report outcome at CEO Feb Board Meeting Provide a report at the

DRVPM Feb Board meeting Provide details at

DRVPM Feb Board Meeting Provide details at CEO Feb Board

, Meeting

Page 19

Extract SCT.5002.0001.0018_0038

BOARD OF DIRECTORS MEETING EXECUTIVE MANAGEMENT REPORTS

27 FEBRUARY 2017

CIDEF EXECUTIVE OFFICER REPORT

OUTSTANDING ITEMS CARRIED FORWARD FROM THE BOARD MEETING HELD ON 24rn OCTOBER 2016

Item 8.1 - page 4 -Development of a State Wide Physical Activity Programme

Arrangements have been made for Mr Dean Ewington, Managing Director, Oceana Aquatic and Fitness to meet with myself on Thursday 23rd February 2017 to discuss the development of an activity programme for the benefit of staff and residents of Southern Cross Care (Tas) Inc.

An update of my discussion with l\1.r Ewington will be provided to Directors at the Board Meeting.

OUTSTANDING ITEMS CARRIED FORWARD FROM THE BOARD MEETING HELD ON 27m JANUARY 2018

Board Governance Remuneration Minutes of the 13th December 2016

Further to discussion at the Board Governance Remuneration Committee held on the 13th December 2016 whereby it "was requested I obtain the best advice available on an approach to undertake a succession plan for Senior Management Staff," I advise of the following action that has been taken:

ORGANISATION CONTACTED:

• Australian Institute of Company Directors Hobart - (Bernadette Ulbrich-Hooper) No real assistance provided.

PEOPLE CONTACTED:

1. James Underwood - Recommended Patrick Herd, Principal Consultant - has done previous work for sec Queensland.

His second recommendation was Shane Fracchia- former CEO of Holy Spirit, Catholic Aged Care and Retirement provider in Queensland.

2. Peter Bell, CEO sec Queensland - Recommended Patrick Herd and Darryl Krook.

3. Jan Ilorsnell,former CEO sec (Vic)-Reconnnended Susan Campbell- Director THINK Leadership, based in Adelaide. Susan Campbell had previously undertaken to do some work for Jan Horsne11.

30

Extract SCT.5002.0001.0018_0039

4. Michael Bendyk-fonner CEO SCC (SA&NT) - Recommended Peter Whelan who previously was a member of SCC (SA) Finance Committee (not on the Board) and was a fonner principal auditor for SCC South Australia.

Mr Whelan has recently undertaken a similar review of the ACHS Age Group in Adelaide. He was formally employed by PKF Group a large accounting finn in Adelaide.

Mr Whelan has since provided a CV for information.

5. Julie Garland-McLellan - Board Governance Consultant Ms McLellan has only recently returned from overseas but was interested in providing us with a proposal by Friday 24th February 2017. Ms McLellan indicated that she would need to have a support person undertake the management succession planning component but had previously provided a succession consultancy for Boards.

She indicated that a company called Cameron and Ralph were experts in this field but would be expensive. Following this advice contact was made with Mr Phil Khoury, Managing Director I Founder of Cameron Ralph to provide a proposal for consideration. Once again this proposal is expected to be received by Friday 24th February 2017.

As mentioned ~t my performance review appraisal I intend to undertake one tq one discussions with each Executive Director (Richard Tyberek, Andrew Crane, Carolyn Wallace, Jill Savell, Pauline Robson) to ascertain their foture work intentions and also to gauge whether they are able to identify any staff or managers within the organisation that have a potential for managerial development.

I would hope that in the near future I will be able to make a firm recommendation to the Board Governance Remuneration Committee on the process which I would seek approval to follow in the development of an appropriate Management Succession Plan.

Item 10. 4 - page 8 -Advertising Strategy - Community Care

At the marketing meeting held on the 2nd February 2017 Mr Rowan Smith (Principal) and Mr Glenn Phair (Managing Director) of Integral Communications presented a marketing, price proposal and creative strategy for the rebranding of Home Care Services from the 27th February 2017. Their submission included the development of a new brand for Southern Cross Home Care titled "Southern Cross Home Care Feel Right at Home" including the registration of a dedicated web page (feelrightathome.com.au). Their price proposal included both television, media, media channel, bill boards and brochures.

The proposal for their consultancy including development of high class television commercials etc. was $180,000.00. It was suggested that the media campaign be held over a 6-week period and would be especially designed to capture new clients.

Executive Management Reports 27 February 2017 Board Meeting

31 Page2

Extract SCT.5002.0001.0018_0040

Two date options were presented to commence the media campaign being the 1st March 2017 and 1st April 2017. As this matter was outside of my financial delegation authority and as the expenditure incurred for this marketing campaign was significant and could not be quantified in benefits, this proposal was outlined to the Budget and Finance Committee Meeting held on Monday zoth February 2017.

The decision taken at this meeting was to defer consideration ofthis issue until the effects of the 27th February 2017 Home Care changes are better known.

Item 10-page 13-Major Projects Committee

During an update on the Springhaven Retirement Village project on Friday 18th February 2017 by Mr Patrick Stanton, Project Manager, and Mr Pater Gaggin, Architect it was advised that the new budget estimate for the construction of 84 ILU's and a Community Centre was $32.35M plus GST. Mr Stanton undertook to provide a breakdown of the cost estimate of this project to the next meet:h1g on 24th March 2017.

Item 12 - page 16 - Site Reports - Yarraandoo

Behaviour concerns of a resident at Y araandoo raised by Director Brian Gallagher will be referred to Director of Clinical Services on her return from annual leave on Monday 271h February 2017.

Item 12 --- page 16 - Site Reports - Fairway Rise RA CF

Both the Fairway Rise Village Manager and RACF Facility Map.ager have been advised that the use of the "Bunker" at Fairway Rise is to be made available for use by both the RACF and Village residents. In addition, the Director of Residential Business Services has been advised to find an alternative area apart from the front entrance to the Fairway Rise RACF for the relocation of the unusual sculpture that was donated in 2016.

STAFF ISSUES

Renegotiation of Southern Cross Care (Tas) Inc and Mary's Grange Staff Enterprise Agreement

Southern Cross Care staff have been regularly informed via 9 separate news bulletins ofissues and developments concerning the renegotiation of the Southern Cross Care (Tas) Inc and Mary's Grange Inc Agreement.

An introductory meeting involving union delegates was held on the 2nd February 2017 to brief representatives on the process which will be followed in the negotiation of a new Enterprise Agreement and dates and arrangements for future meetings. Union representatives were advised that future meetings have been scheduled as follows:


32 Page 3

2nd March 2017 • Claims presented by Employee Representatives

Extract SCT.5002.0001.0018_0041

• Proposal presented by Southern Cross Care (Tas) Inc (SCCT) and Mary's Grange (MG)

1@11 March 2017 • Response from Union membership • Response from other bargaining representatives • Response from SCCT and MG

30m and 31s1 March 2017 • Information sessions to employees • Report to members by Unions • Report to Non Union Employees (NUE)

13tn April 2017 • Response from Union Membership • Response from other bargaining representatives • Response from SCCT and MG

27th April 2017 • Substantial Agreement - Ballot agreed

To be determined • Conduct information session with employees • Working ballot (ballot box at each site) • Majority agreement reached • Agreement signed by all parties • Agreement lodged with Fair Work Commisson

At the Budget and Finance Committee Meeting held on the 20th February 2017 discussion occurred on the quantum of any salary offer that would be submitted by Southern Cross Care (Tas) Inc at the first fonnal EBA Meeting on the 2nd March 2017.

Given consideration on a range of :financial implications that will affect the operation of Southern Cross Care (fas) Inc and taking into account the overall inflation factor as at 3pt December 2016, for the economy, it was agreed that an initial wage offer of 1.3% back dated to 1st January 2017 be offered by Southern Cross Care (fas) Inc at the first bargaining meeting with the Unions.

This recommendation is submitted to the Board for approval

It should also be noted that the Board at its meeting on 28th November 2016 provided prior approval that if"any urgent decisions are required to be made, the Governance and Remuneration Committee are authorised to make those decisions being matter of detail only on behalf of the Board".


33 Page4

GENERAL ISSUES

Imposition of General Rates on Retirement Villages

Extract SCT.5002.0001.0018_0042

Apart from answering queries posed by our instructing solicitor J\1r Marc Edwards, Page Seager, there has been little further work undertaken in preparing for our legal case to be heard on the 23rd and 24th May 2017 in the Magistrates Court of Hobart.

However, in keeping aU stakeholders informed of progress in this important matter I met with the residents of our Westbury Retirement Village on Thursday 161

h February 2017 to bring them up to date. It is intended that a similar meeting with the residents of A A Lord, Taroona will be held in the near future.

The next Directions Hearing in this matter before Magistrate Mr Mallard is scheduled for the 7th March 2017.

Replacement of current Southern Cross Care (Tas) Webpage

Following the decision taken to engage Ionata Digital to redesign our current Southern Cross Care (Tas) lnc webpage, considerable work has been undertaken by Mr Nick Rainbird, IT Manager, in conjunction with representatives ofionata. · ·

This has led to a situation whereby an :initial webpage content and a :framework concept has been developed by Ionata for consideration by Southern Cross Care (Tas) Inc representatives. This project is proceeding in accordance with the project timeline. At this stage our objective of having a new and fully functional new web page will be developed for commissioning by the end of May 2017.

Richard Sadek Chief Executive Officer


Page5

34

Extract SCT.5002.0001.0018_0043

DIRECTOR RESIDENTIAL BUSINESS SERVICES REPORT

FINANCIAL REVIEW January 2017 has seen Residential Services sustain a loss for the month. However, this loss at -$190, 871 is more than 50% less than the budget expected loss of-$404,366. Whilst this loss was expected it is important to understand why the loss was budgeted for.

Overall residential Services is -$95,145 below budget YTD. However, this figure does not the operational aspect where 8 out of9 RACFs made an operational loss this month and requires further investigation and action.

The explanation for the month's performance related partially to the 4 Public Holidays (PH) ( 4 because when a PH falls on a weekend as Christmas Day did, the day is treated in terms of salary payment as a PH) This means all 9 RACFs incurred 4 days of PHs in addition to the accrual of the prospective salary increase as from 1st January 2017 (however not agreed to or paid as yet) This is why Residential Services was estimated to make a loss in January. Havmg spoken with the DoF on the matter it is clear that next year the cost of the PHs will be allocated to the month they occurred :in making December and January a more realistic picture of performance.

This month also included an accrual of 2% in salaries in preparation for the EBA :increase from 1st

January 2017 for all RACFs.

Sandown results • This RACF was budgeted to make a loss of-$30,905 however made an overall surplus of$24)755

and was the only RACF to make an operating surplus of$13,961. This is the result of finally filling all permanent RN and EN shifts. This was achieved through the appointment of a 457 visa holder in December 16.

Ainslie Low Head • This RACF achieved an operational loss of $14,462 which was the result of agency costs and over

time to address the RN shortage issue. This has been addressed by: o The employment ofa 457 visa holder who although he worked as a RN overseas has

completed the Australian transition program and is awaiting registration. o The termination of an RN who has effectively not worked since last May through a

combmation of Workers Compensation (Claim not accepted) and sick leave this month has enabled her permanent shifts to be allocated on a Permanent basis

o The appointment of an experienced RN who follow:ing an old mjury requires a longer period of Supervision and Induction. However, we have a neuro psych assessment confirming full capacity to work

Fairway Rise • The December result indicated we were on track with the November roster changes fully in place.

However, a further meeting with the DoF and the FM is scheduled to identify if this RACF is operating outside the approved roster and implement immediate action if this is the case.

• In January compounding the PHs, two staff were stood down for nearly the full month pending disciplinary investigation, therefore for this period of time the RACF covered both their costs and shift replacement costs.

• There have been some issues created with RosterOn management which will be significantly improved with the upgrade to the system.


35 Page6

Rosary Gardens

Extract SCT.5002.0001.0018_0044

This month has seen the impact of the December roster changes with an overall performance of-$25,475 compared with a budget of-$183,902. The biggest outstand:ing issue for Rosary Gardens is the reduction of the permanent relief pool. This is being addressed with further action to be commenced if people in the permanent relief pool decline permanent shifts elsewhere or even at Rosary Gardens.

11 The new rosters are working well and the Leisure and lifestyle revised roster was implemented during the month. There are still significant numbers of EN and a smaller number of ECAs in the Permanent Relief Pool and these individuals are being developed to work across all southern RACFs now they have had the opportunity to familiarise themselves with the working of the relief pool. The progression of this will continue to impact positively on the bottom line of Rosary Gardens.

• A review is underway into the servery hours :involving the Executive Chef working with the Facility Manager.

11 We are unable to progress the full closure of St Catherine's as the decision has been made not to separate off the 6 rooms in St Cecelia's until the tender is let. This means we cannot move residents into these rooms as they still form part of the secure unit and the residents we need to move do not want/need a secure environment. This has delayed the ability to remove the staff and reallocate to the remaining wings. The Facility Manager, on being advised, both of this decision and the delayed time frame has offered further respite to make use of the availability of the beds.

• The Facility Manager, Human Resource Officer and the Southern Services Manager have progressed the temporary transfer of the laundry and staff to Sandown during the time the laundry is being renovated. The two laundry staff will take the laundry to Sandown Apartments on a daily basis and utilise the laundries available to complete the personal clothing of the residents. Once the new laundry is operational there will be a need to reduce laundry hours significantly. This would be the optimal time to bring the Rosary Gardens cleaning in-house. This would significantly save in redundancy payments (the employees in this role arc long term employees of sec so the costs would be high) and maintain the commitment to staff to retain their employment where possible.

Y araandoo & Glenara Lakes

• The January outcome for these two RACFs was of concern and requires further analysis that

cannot be provided within the time frame available. This result was not expected based on the

performance in December and there were no approved roster increases for January. This is

especially so for Yaraandoo which had been tracking down in the previous 3 months towards the

break even with increased ACFI and occupancy.

• There has been one issue impacting on both RACFs and this is both have been managing a

difficult resident (different issues) which has required significant 1: 1 because of behavioural

issues. Both have had the specialist team involved in assisting the RACF to manage these

behaviours of concern. A review into the :impact of this is currently being undertaken.


36 Page?

Extract SCT.5002.0001.0018_0045

Both RACFs have the highest ACFl and in January a high occupancy although Glenara had a

budget of99% occupancy and achieved 96% occupancy. This relates primarily to the average time

taken to fill a bed now. I have met with the Facility Manager and the Residential Enquiries Officer

north to review this issue and am in the process of preparing a paper for discussion with the CEO

and the DoF on this issue.

MountEsk

• Mount Esk although making an operational deficit of$36,810 performed above budget which

estimated a loss of$60,241.

• We continue to experience issues arising :from the renovations with fire doors requiring repair and

replacement (this has occurred) and there are still cracks in some ceilings identified in the review

of the works but still awaiting progression. The CEO has initiated a follow up on this matter with

Mr Patrick Stanton.

Mary's Grange

• The final component of the nursing I care staff reduction has seen the transfer of an Enrolled

Nurse to GYG to reduce the hours in the Permanent relief pool and enable GYG to fill a vacancy.

This was a win/win for both RACFs with only 12 hours of EN hours a furtnight in the Mary's

Grange pool and these hours will be offered for the additional need at Sandown Apartments.

• With the revised care roster in place and the Fitzpatrick Wing closed the next step in the

management of costs was to revie\v the cleaning requirements of the facility. I requested the

Facility Manager, the Human Resource Officer and the Southern Services Manager to review the

current cleaning requirements and provide advice on any surplus. This working party identified a

significant surplus of cleaning hours (137 per fortnight) with an annual cost to Mary's Grange of

$89,000 per annum. In reviewing the YTD deficit at Mary's Grange which was at the time of

review (end of December) was -$223,959 there was clearly a need to implement a revised roster

arrangement. It was however, further identified there would be a redundancy cost ofbetween $12-

15,000.

Following consideration of the following:

o The cost of redundancy cost payments,

o the potential loss of good will with the staff at Mary's Grange ifredundancies were

considered; and

o The ability to address the problematic quality of the contract cleaning at Sandown

Apartments


37 Page8

Extract SCT.5002.0001.0018_0046

I called a meeting with the working party and the Facility Manager Sandown; the outcome of which was I developed a business case for the CEO. The aim of this was to implement the change management proposal for Mary's Grange saving $89,000 a year in salary expenditure and to redeploy the execess cleaning staff to Sandown. The proposal was to bring the cleaning at Sandown in-house as a strategy to manage the poor quality of cleaning (7 family complaints and 2 resident complaints in 6 months) which had not lifted despite meetings with the contract manager. This is awaiting further review by the CEO.

• Mary's Grange 601h Birthday Celebrations arrangements has been passed to the Director Retirement Villages and Property at the request ofthe CEO.

1. OCCUPANCY The following table shows the number of deaths YTD as at 31January2017:

Month GYG [sA IRG FWR ME GL ALH Yar MG :·x1:.ia.r. , I

Total Deaths 7 19 I 22 12 22 19 11 22 9 :•1;3i

ACFI • The ACFI income for SCC has increased marginallyYTD and is currently $169.25 prpd. We are

seeing the work undertaken at Rosary Gardens by Jane Eagle come into :fruition. The new ACFI Coordinator has settled into her role and is working closely with the Facility Manager who has commented positively on her skill base. The Rosary Gardens ACFI prpd has increased from $159.25 prpd in November to $164.45 prpd as at P 1 February2017.

GLENARA LAKES ACREDITATION • On the 31st of January and 1st February a three-person Accreditation team from the Australia Aged

Care Quality Agency visited the RACF for the accreditation review. The feedback during and at the end of the visit was positive with staff, residents and most family members making positive comment on the quality of care~ the opportunities for training (staff) and the willingness to be listened to by management (families).

• The main concern raised by families related to the loss of personal clothing for residents when this was taken to Mount Esk for laundering with some families advising they would rather take this home than risk the loss. We were able to show this issue had already been identified and was a budget item and would be progressed once the work in the Peter Comas wmg (mstallation of air conditioning) was completed. (the aim is to reduce the impact of works on residents)

There were some comments from the families of residents living in the secure dementia wmg of concerns over staffing levels and the disruptive behaviour of one of the residents. There was feedback from the assessors on the day on the documentation system ofreportable events. The recommendation on the day and in the report was the RACF provided the evidence to support a recommendation of 44 Expected Outcomes met out of the 44. There was additional information in the report and I assisted the Facility Manager prepare a response to the issue. We now await formal confirmation from the delegate of the outcome of the review.


38

Page9

ROSTER MANAGEMENT

Extract SCT.5002.0001.0018_0047

• The roster management in the south was progressed with the planning for the Rosary Gardens Roster Clerk to join the roster team at state office on her return from leave in early February. This builds in greater capacity for the team to cover roster management in the south and provides supervision for two relatively new roster clerks by an experienced SCC Roster Manager.

• This has now built in the capacity to further progress the allocation of the Rosary Gardens employees based in the Pennanent Roster team to cover shifts at other RACFs in the south. The first task of this individual in February on her return is to progress the Orientation process to enable this move to occur.

Pauline Robson Director Reside1itial Business services


Page 10

39

Jl!· As at 1 8 February 20 l 7 6324 at Ju\y 2015.

~01.J ~{:;!:~i:L~?ii}OO

:i;!f,;:r)~. S~lBk~w~ J>.pa.rtm~t~h

r:t~s}.t fik!--:'"~:f:,:t ~«~;~

$;Jj t ~:~~:r·w~;::' ~~_w

f~-1t ~:Q:;.¥~~~· ~:~d:.t·;;'i~

:§:(~f ~'>:~:.;H·{;::: f;;:!~~$,:i?

~i*J~ ~~~/Mfvr'ci 'r'q4r-:g w~~l?~

~~}it·~: ::JSt~ A.!r.:s~~~ ~,::_>-~ H~~<l

Ongo~ng r:evietws

~:

HRSJ.

!.\)%.'.\1

11:;.t .. :<J{j.

1.$'Y ... ;J4

111,4·~·

lf.;;& .. i;:{t

8 ~

1~?',0~ t§.;<.$1{ li>it5t

HP2~ 1B::Z,'.t0 i$L7:3

inutt ~.&1.2·n Mi%.1i l!W57 1~§J~~>{ l&~LYt

l'.Vi.1)8 1$4,§~~ ).t»l.49

u.~$ .. l'.l iMJi<>t i[<t.62

b1.SJ 1:$4 ~~$ iu.:n.

111 There are currently 58 coi.npleH~d Tabletop a.sse!ilsments requfred to until

resid0nt ~ a.nntu1.li!EK>ti value

full the

=:i- :::;;.r;.<~:"

ill ~$~.~~I !]] :jj ~*>.::~

k~'""'""' ix1mpk:tion per resid cnt

A1uirm+' (iet1rgc> <iam(rn ACFJ Mimagf!t

%:

i t§.5.~H1

i~~).$

t$:!LW~(

~.Ei$~-

!N\1% !.'.N.l'l

~~~4 .$:~

Extract SCT.5002.0001.0018_0060

$l64J8 to $1

"' :::-.0 "' ~ :-:-:>: ~ .;:, ,,_. "'

,,, .J~ ro~~l ~-'

~ !;' t< ' t~:) Mn $1 }~3.ti~

t{µj .. ~H') }~t.$7 i7~} ·iJ~ ~~i&fi%

tt~ .. }~ ~7"} .. ~~ rnt%~ 17),,4~ '~}):1:ti~~

~·~U.:~Z un.~:s t~liHl 11'7.St :~-~-~%

:H:n~.$i MJ:.7~ MLO 1~~.tl%: tJ .. :t~h~ ~faS~ffO' MfS,t)~ §:fu~,-4~ J:fr4,.9~: -~::l'tt%

i~8,.·;~:fj i.~?·:2A,{ 15\Ull J.'U ~%

~~~>.~r.m ·~:k-::

\"i:~1N~)::' ~~·):C~)~

:::;~~··:=,:i~:::~>. ..::~W»:;X

::X~~~~».-::4::~~ ~-»~~~~{.;.,.%-t

~>;i.;:~~~~;::~::X(~~ -x:::::mi~~~m;:

fr;~;z;t;;;;~ ~~1~)"r,q'$tf;;~ro:dtf~&.ptx""f~{""'wwwum~~ ···="'"WWl.wNu~~~~'""'"""w ······'"""._ .............. , ............................. .., ...... ~~~~w ....... w ......... """w~~.·.··'''''~~~ .......... ~~~~~~~-w. .................. w.·.·.·.·.·.·.·.·.·.;;;~~~~; .. "}"(;""""-""'"""·.·.· ... ..

Z7 F'-ei":n.NM)< 2.01 l Bo.filt~~1 fuf~'°tUna

52

DIRECTOR OF FINANCE

1. Southern Cross Care (Tas.) Inc. Executive Sununary

Extract SCT.5002.0001.0018_0061

A.1 Financial Performance to 31 January 2017 - measured against budgeted surplus (year to date): Target $1.092M surplus. In terms of the Budget estimate of $1.092M, SCC is favourable to estimate by $394,037 at $1.486M. Wbilst the aggregate result appears reasonable; there has been an under-estimation of Revenue growth which is explainable by improvement in occupancy at Rosary Gardens and significant ACFI uplift during budget year ($1.275M favourable to Budget) and inaccurate estimates (wage estimates were signed-off by Facility Manager but did not reflect the underlying Roster) in some instances for care wages ($410K unfavourable) and therapist contractor costs ($189k) unfavourable. In comparing between December and January Results it must be noted that under our current accounting methodology, January incurs 4 public holiday costs and this is reflected in our January Budget. This means with public holiday loading at 150% - January has costs that are equivalent to 37 days (31 days plus 4 public holidays times 1.5) and income equivalent to 31 days. This methodology win be reviewed as whilst it is accurately reflected in the Budget when comparing actual to actual results January looks like a sudden deterioration in financial performance. January also includes estimated costs associated with a new EBA. The Budget assumption was to set aside 2.5% each month from 1 January to 30 June. In January we set aside 2% into a provision account.

A.2 Liquidity Measure (year to date): Actual 2.61 (last month. 2.46) Target is >than 1 and less than 3 This measure represents our ability to meet our short term obligations and is a rough proxy for measuring :financial health. SCC has covers its current liabilities 2.61 times which indicates a really healthy balance sheet. If ratio > 3 over time it could indicate that we are not using our working capital efficiently. In our case~ SCC is holding significant cash reserves eannarked for rebuilding Rosary Gardens; renovating GYG; etc. SCC is actively investing these funds in the :interim.

B.1 Residential Aged Care Services (Total Result year to date): Target Estimate $478,879 surplus. Residential Aged Care Services has a Total Result of $383, 731 (last month $574,518) which is unfavourable by $95,148. In terms of Budget, Rosary Gardens; GYG and Glenara Lakes are favourable to Budget (same as last month) whereas Sandown; Mt. Esk; Yaraandoo; Ainslie and Fairway Rise are unfavourable (same as last month). The key question is whether management has a handle on moving to break-even and the progress ay Yaraandoo and FWR will receive focus this month. Rosary Gardens is heading in correct direction but there are still a significant number of employees in the pool and this must be finalised.

B.2 Residential Aged Care Services (Operating Result year to date): Budget Target $1.615M deficit. Sustainable Target is break-even. Residential Aged Care recorded an Operating loss of $1. 728M compared to budget estimate loss of $1.615M loss. This is unfavourable by some $113k. The significant contributors to this loss are Rosary Gardens at a loss of $518k; Fairvvay Rise has made an YTD loss of $327; Yaraandoo $258k and GYG $247k. Plans are in place for each of these Facilities which will be reviewed during the month.

B.3 Home Care Services (Total Result year to date): Budget target $108,683 surplus. Home Care recorded surplus of $380,687 which is favourable by $272k. This is a good result but is driven in part by retention of unused funds which from February are returned to the Commonwealth. This is very much a watch and see situation but there is no doubt profitability will reduce.


53

Page JI

Extract SCT.5002.0001.0018_0062

Jndependtmt Living Units (Strvk® and l\·falntcnance Fee Yca:r to cl.ate); ~lmlget target $504,I 68' sa.rphrn. The is $368,018 is m1fawourable to budget $ i36k. relates to n(HHlperating \vhich is $72k unfavourable the month, component is a otx>off

a D1\/1F payment (Coulbom ... Dtvff taken December a:nd departure The is six out over F\VR

C.l Rt,s.~dcntfal Services Break~even Strategy ..... progress report

Southem Crnss Care Residential Services Operating and Net Result per day occupied between PfZOU and January 2011

Jf.WO

The graph improvernent for bed day sold. is nmv !S a improvcmentJn of'YTD December v;,1as deterioration tr\.m1 a Iost of S l 23)1 per bed day tKdd to a Joss of$1 methodology public Not\vith!'itm1ding, in

untlermarn:Hng our improvement not ph1ns for and Yaraandoo arc not

A.l F'fo.nJ1cfoJ Perf0r.trn1uce to 31 ,January date): Tm·get $14,841

tenxts the Budget estirnate of $ ! surplus, MG is fovnurnh!~ to estinuite by $1 $172,952, The imptovernent is due to ACF! 1nm1agen1e11t ($34Sk favourable); a cost budget budg~t vrhich is Indicates active there is, higher budgeted deprcciai unfavt<uruhk:) and Ffotne Care is thvo1wnble.10 budget hv $55K.,

' ·~··· N

A •• 2 Uquidlty 1',ieasure (year to ihdt): Actual< than 1 Target ls >d:rnn l and less tlmn ,3, This i11e2suro fhrther '"'Otk as iiahiiitie5 arc as current

l l at line 'Nith

($11

B;,J Resid.endaJ Aged Care St\nkes (Tot::d .Rmndt yt'ar tz; date)~ Target Estimate $3031544 loss RcbidentbJ Agt'<l Care Servic:es ha:s s ·rotal of$355,604 is 1.mfavnun~hle by $52/)60, total l.oss includes hwercst expense on loan:; ~md fa not l'Omp:irnb!c to

E.:=$t:C"vtf1~ f,Jfdt~)9¥..~tt~·~;'f.'t~t P-OJ~<>tf$

~tt f'*fN~NYY 20 f/ fkHJfrJ $Jf;t?t~~{J

4

Extract SCT.5002.0001.0018_0063

B.2 Residential Aged Care Services (Operating Result year to date): Budget Target $232,297 deficit. Sustainable Ta:rget is break-even. Residential Aged Care Services achieved an operating loss of$123,988 which was $108k favourable to budget. Variance analysis will be provided progressively in future reports.

B.3 Home Care Services (Total Result year to date): Budget target $3,899 surplus. There is a strong favourable variance of $43k driven by revenue.

Appendix 1: SCC Detailed variance analysis

Not available at time of preparing this Report.

Appendix 2: Analysis of adequacy of provision account for Villa tenants share of Capital gain at discharge

1. Background

11 Southern Cross Care made two significant adjustments to the Villa Tenants share of appreciation provision over the last 2 financial years. In FY2015 the adjustment was $1.405M and in FY2016 $0.879M. In each instance, these adjustments were processed during the audit of our annual statements and necessitated an unexpected write-down of our accounting surplus.

11 The Board has requested that the adequacy of the provision account be tested prior to end of financial year. This Report examines this question.

111 I also consider that as part of the Budget process for FY2018 that SCC estimate the discharge value for each type of Villa at each Village be budgeted and accrue to provision on a monthly basis. The adequacy can be tested at the half year point to ensure the accounting methodology is sound.

Table 1: Aggregate data of SCC Villa contracts and provision account for capital gain .

... ___ -· ____ ·---·- ________ T._q!:_aJ_______ _Jot~l..Ylllas ~!_h, ____ ·-------.. -~9-~.-- ___ .PJ~-~b_<!E~.E!.. .. -~-r.9_\liS.s>.~-----

Loca ti on. .. .. . _ . .. _ .. . .\11~1-~~--- __ ---··- --~~2.~~!!_I_§..?.!.~~~?!".. ____ ya l~_e __ ·-· _____ y~_l_~e ... . -~~~9.~l!J~ ... __ $M $M ('000)

St Canice 64 21 11~21 11.221 48 --··--·-·- -··--·· ,,,_ ··--·---------- ·- •-o -.,-. r••• -c~-·-_,_., ____ •••••• • -··-·••• • •-••--•· - • •• •

Gul I ford Y?un~ Gr_~ve_ ..... 31 1.13 1.137 4 --··--· -·---- ·-~-----·--~--~~ -·------------ ---·-------- .... Sandown 36 ....... --~§···-·····-·--·-· _______ }±:~---~--·· - --~?~} _______ ---- ..1-!zgg_ Glenara 93 ---~!__ ... ___ ... ?!'.~~- _ _ _ ... }_1.}2 4,f)OO Yaraandoo 10 8 1.767 1.762 55 ---- ----- ·--- ·•••---••••• ·--·•-••--••••- --------r~~-~~----·- ••-• •-•---~-~

Fairway Rise 104 98 36.049 39.275 751

Total 338 259 86.468 102.015 7,458

Please note: Whilst the Table shows aggregate data - SCC records show individual calculations.


55

Page 19

Extract SCT.5002.0001.0018_0064

2. Analysis

II

Iii

JI

At 30 June 2016, SCC had set aside in its provision account for tenants share of capital gain at discharge $7.458M. This is based on the contracted capital share arrangement in place for 259 clients out of a portfolio of 338 clients. SCC loan value on capital gain share agreements is $86.468M and the estimate of discharge value at 30 June 2016 was $102.015M.

Glenara Lakes has the largest provision balance at $4.9M which is understandable given that 53 tenants have occupancy dates less than 2005. The average loan value is $247k and the average estimate of discharge value is $377k. Nearly all contracts are 50% share of capital gain contracts. There were two discharges so far this financial year where in total we paid out $179,500 in capital gain and had provided $184,500. On this evidence, the provision for Glenara Lakes capital gain is adequate- maybe slightly over provided.

Fairway Rise is a relatively new village which would normally suggest the Loan Value and estimate of discharge value would be relatively close. This is not the case as our Loan Value on 98 contracts is $36.049M and our estimate of discharge value is $39.275M. Our provision balance is $751,000. SCC current selling price will play a significant part in the discharge valuation. The average loan value is $368k and the average estimate of discharge value is $40lk. There have been 5 discharges this financial year with a capital gain payout of $53k compared to a provision of $40,500. This suggests the provision maybe slightly under provided.

Sandown has a significant provision of $1.7M which is understandable based on 25% pre 2001 contracts and 5 contracts with 100% capital gain share. The average loan value is $414k and the estimate of average discharge value is $480k. Sales history is for only 2 units but suggests provision is understated:

Unit X Loan Value Independent Valuation Next contract

Unit Y Loan Value Independent Valuation Next contract

$490K (2014) $515K

$565K

$480K (2009) $530K

$600K

In respect of Unit X and Unit Y the capital gain was $37,500 and the provision $22,500. On this evidence, the provision is understated.

11 St. Canice has 43 clients out of 64 clients that have no access to capital gains. The loan value and discharge value of remaining 21 tenants is basically the same at $11.2M. The rationale is that there has been a decline value on all 21 Villa Units since the contracts were signed (that is, the estimated discharge value is< loan value).

11 The following Table indicates current selling price and was used in estimating the discharge value at 30 June 2016 and in all cases the estimated selling price is Table is higher than the existing loan value. The loan value as contracted is paid under these circumstance.


56

Page20

Extract SCT.5002.0001.0018_0065

Table 2: St Can.ice Villa and Apartment estimated Selling Prices as at 30 June 2016.

STAGE i EXPLANATION I-APT NO. I Estimated sale price

GARDEN APTS Ground floor 2 br 20 $450,000 •• •- -,-,-•-- rr ----·-•~-h•••••--•• "---- ------~-• ~~·- --- -~--~------·--·--- --

TERRACE A

- _1 s ~ ~~'.?.r_ ~ ~~~ _!'l~l!~.¥ _ _?_?_ _ _ _ _ ___ --~~.!_?._!QQQ_ _

T()p th:mr ~ ~~

~l?P.~r _?br + study

32 $525,000 - . ·-···--------·-

33 $900,000 ····-· ·------~--·-·-·

71 $635,000 ···--.--"--.. - -•; ,.•~ - c ••• ,, .. _____ " __ ,_

72 $635,000 ----- ---- __ -··zr:··:-:----~~1§.~~9.9.Q~~=- ---75 $635,000

. Lower_?br. ~ ~t~9y · -~? -___ :_~ __ ]~9QJ?IS9.·: .. __ TERRACE B _____ l,?,~er_,?. br_-t-_~_t_~_dy__ ___ . -~~- _ ... _ ---------~~~~_22g

51 $460,000 ······-- -·--····----- ------··---·· -------- ·-~-- ·-----$47Kooo ----• • n•••• •• ~ • • --···r•···oorn •••• ••·---• ---•--- ~-·53 _,. ... .,• ••-•-••---$475~000 •••-•••-.-•-

•• ··~ .. ··- ····-·-·----·-· .. ·--·-·-··-·-·· ··---- -------- --------.. ---.--..----·--·-----. HERITAGE 2br +study 4 $500,000

_ _______ _____ .. _______ : .. -~--- ·= -~=: ----~-I-~~~-- ~==---~_Js2~"Qa·a·-~-.. -:.:~~ . - - - - . -·-- --· - -·------·- --- .. ---~······· _______ $500~9..QQ. ___________ _

.YP.~~-?.~.r .:': _ ~ !l:l~Y . __ _ _ __ !_? ____ ---·- _ ·----~~!.?· ooo ----· __ _ . . ___ .. .. _____ ...... ···-··--···-·--·-· . 1-~- __ ··- ---· $595,oo_q ·------

Upper 3br +study 9 $980,000

_. -~~ _L()~e!~~~L~~I~~y:~~- ~-·1·~==-· :.-.~--~=·=~)?56~QQ~.:~-~=:.

3. Comment

111 The provision for recognising the liability to SCC sharing capital gain with tenants of our Retirement Villages at discharge at $7.458M is possibly inadequate but after the last two financial yeaJ's adjustments :is manageable.

111 Introducing an annual indexation as part of the budget process makes accounting sense and it will assist in keeping reasonable.

111 The pressure on the provision will come from FWR if demand and prices increase.

111 The contracts written at St. Canice without any share of capital gain clause eliminates this issue for 43 contracts. The Jemaining 21 has no current provision for capital growth and this maybe an exposure.

1111 Sandown provision is possibly $7,000 to $8,000 under based on sales data This is possibly a $250,000 understatement. For example:

Unit X (100% share of capital gain) Loan Value $220,000 (1997): SCC provision based on discharge value at 30 June 2016 of $510,000. Sales data (albeit on more recent tenancies) suggests >$5 l 5k depending on wear and tear.

1111 I propose we treat this report as work in progress but Committee keep it on the agenda.

Andrew Crane Director of Finance


57

Page21

Extract SCT.5002.0001.0018_0103

Southern Cross Care (Tas.) Inc.

----------------

Site Board Report Yaraandoo

January 2017

Resident activities continue with the following highlights:

• Jewellery Making • Music and Art therapy • Knitting with Vernice and Helen • Weekend movie afternoons in Grandview Lounge • Line Dancing • Cooking with Linda - Residents recipes • Preschool children visit from Beetle House • Mens Group (Theme) • Australia Day BBQ including the 'thong throwing' competition • News Year's Eve Party including fire works display (made of colorful balloons) • Various entertainers • Various bus trips throughout the month including to Vonda's Farm (a Volunteer) • Well being centre on Thursday's

Resident or core business issues • 0 Vacant beds at the end of the month • 7 persons on the waiting list all low care

2016-17 i July Aug Sept Oct Nov Dec Jan Feb Mar Apr May I June No of 14 2 9 2 3 0 2 ( departures i 1

i

Staffing • Work:plkace review by Consultant has been presented to staff with progression of the

recommendation underway.

ACFI

Villas

• Sick leave in January continues to be high • Union presence on site "Right of Entry" one issue raised on follow up education for

management of difficult behaviours • Staff annual leave

~ 8 staff identified with excess leave have now had leave scheduled

• The team continue to attend routine assessments 3 submitted and with one incurring a loss of revenue due to improvement in condition

• Vacant unit (10) has been promised.

Glenn Wickham Facility Manager

Yaraandoo Facility Manager Board Report JANUARY 2017 Page 1

92

CT 22

Extract SCT.5002.0001.0018_0104

Southern Cross Care (Tas.) Inc. Site Board Report

Glenara Lakes

January 2017 Activities: All routine activities continue to be enjoyed with the addition of:

• Celebration ofthe New Year and Celebration of Australia Day BBQ • Tia Chi in the Foley Courtyard • Skittles/Quoits Summer afternoon tea :in the Foley Lounge • Gifts and Decode (shopping) • Mystery bus trip • Concerts: Hetty Binns

Resident or core business issues: Month Nos of deaths

July Aug Sept Oct Nov Dec Jan Feb Mar Apr May June CT 4 4 1 4 3 2 (+ 1) 4 18 +1

• ACFI income: work continues to maximize ACFI income with four ACFis submitted • Occupancy remains consistently high. There is a developing issue however and this is that it

is now taking longer to fill a bed because of the high RADs. • Costs to be incurred: Air conditioning in Peter Comas, the second wing is under installation. • The geothermal heaters in resident rooms are starting to break down with the compressors in

them ceasing to work. Each replacement is approximately $2,500.

Accreditation: • AACQA Accreditors assessed. Glenara Lakes on 31st January 2017 and 1st February 2017

and have made a recommendation of meeting 44/44 Expected Outcomes. There was some additional information in the report. A response sent on Thursday 16/02/17, we await the delegate decision.

Staffing. • Two new ECAs employed • Staff in the Peter Comas Wing are under duress because of the very complex care needs of a

resident who is requiring a great deal of 1 :lcare. Every avenue of assistance has been sought and we have been granted $1,500 in three increments by the Severe Behaviour Response Team to assist with her care.

Education • End oflife care "Demystifying death and dying, what we do and why''. • Diabetes training. • Mandatory Reporting Education session delivered by DCS to management • Food Safety Training

Villas • Villa residents always receive priority when care is required and another ViUa resident is

being admitted to 'the Apartments".

Brigid Flymt Facility Manager

Glenara Lakes Facility Manager Board Report: January 2017 Page 1

93

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