LINKS CORPORATE MEDICINE WEB SITE Background The many extracts on these pages are from copyright material. They are owned by the reference given or its owner. They are reproduced here for educational purposes and to stimulate public debate about the provision of health and aged care. I consider this to be "fair use" in the common interest. They should not be reproduced for commercial purposes. Every attempt is made to provide accurate and well written material. Your contributions, suggestions, additional information and advice sent to the web address at the foot of the page are welcome. Where possible they will be included in revised pages. The intention is to show the general thrust of corporate practices as well as the nature and extent of any allegations made. Material contained here represents my views based on my study of the operation of the health care marketplace and the material available to me. It should not be assumed to represent the views of any other individual or organisation. Links to Site Maps Central Initial USA Australian International Corporate Practices (to print) Path to this page Home Australia Markets & aging Nursing homes The Companies overview Health care Hospital Corporatisation   Entry to Privatisation   Privatisation Background   Australian states Pathology & Radiology Gen. Pract. Corporatisation Aged Care Story of corporatisation   Nonprofit dilemma Aging bonanza Banks Nursing homes Home Care Breadth health corporat. Retirement Villages Nursing Homes Government    1985 to 1998    Correspondence    1998 to 2001    2002 to 2005    2006 Accreditation Nurses    People farming Residents & Relatives The Companies Not for profit homes Nursing Hm Comp The Companies overview Company Introduction Listed Companies Milstern DCA    Audit problem Ramsay Hlth Care Aevum Retirement Care Aus. Bigger unlisted Comp. Moran Hlth Care Tricare Regis Grp Unlisted Comp. Vic. A Illawaong Saitta/Neviskia CIS Holdings Unlisted Comp. Vic. B Eildon McKenzie SRS & Marnotta Enhance Peel Street Muskjest Lasalto & Easyplan etc Ellis & Elfam Dampier Bay Hastings Regional Navatha & Locksley Unlisted Comp. Other Aegis Sauve/Craigcare Kennedy Thompson Alchera Park Trans Dominion/Farad Gonzales Bresant Tolega & Karoona Peninsula Introductory page This corporate web site addresses the issues of corporate health care within a broad framework. A web page describing this broad context should be considered as an introduction to each page on the web site. If you have not yet read it then CLICK HERE to open it in another tab or web page. Content of this page Founded by a very successful self made businesswoman this company was listed for a few years. Allegations were madeabout its nursing homes and it was claimed that staff levels were cut to boost profits. Claims were made that it was treated leniently and there were allegations about the relationship with the aged care minister and political donations. All of these were denied by the minister and the owner. Retirement Villages and other businesses run by the owners are also examined.  Australian section    Milstern Health Care Yagoona, Ritz and other Nursing Homes

  

CONTENTS

• Introduction
• The Milstern Story
• Mrs Millie Phillips
• The Hotel Businesses (not Milstern)
  • The Canberra International Hotel
  • The Rex Hotel
• Equal Opportunity Issues
• Retirement Villages
• The Nursing Homes
  • The Ritz Nursing Home
  • The Yagoona Nursing Home

It has been suggested that this web page is defamatory. I believe that this is because the page has been read out of context instead of as part of a web site in which arguments and context are created. Clearly it would be excessively tedious for the reader and needlessly repetitive if I repeated all of the arguments on every web page. There are over 400 of them. I have therefore now written out a summary of these arguments. I am including a link to that introductory page on new and on older pages as I update them.

Readers who come to the web pages for the first time should consult that page. It will open in another window.

IF YOU HAVE NOT YET READ THAT PAGE YOU SHOULD CONSIDER IT TO BE PART OF THIS PAGE AND ITS INTRODUCTION.

Readers should consider it as an integral part of this and other pages. This should remove any doubts as to the intention of the web pages and their content.

Click Here to go to the introductory web page

The complaint about this web page was not specific:- No reason was given for the claim that this page was defamatory. To resolve the issue I have removed any comment of mine that might be considered judgemental lest it is what gave offence. I also apologise if the page gave the impression that it was the owner of the company rather than the marketplace health and aged care system which she and her company represent that I was criticising. To address this issue I have now included material about the owners retirement villages and other business operations in the wider marketplace in order to place aged care into this very different context.

I leave the reader to decide whether this sort of environment is an appropriate one for health and aged care and whether people who succeed in one can legitimately (and I don't mean legally) bring the same patterns of thinking into health and aged care - and whether this in fact happened. I argue that the market and health/aged care are essentially incompatible (pdf file).

The selection of material to quote:- Because the allegations made in the press reports were based on assessments made by statutory bodies protecting citizens and on allegations raised in parliament where there is a responsibility to be fair I did not include all denials and other statements made by the company and its staff in my original page. My comments were based on the probability that there was substance to at least some of the material.

It may be that the material was considered to be defamatory because of a biased selection. I have therefore reviewed all the material to ensure that the extracts are representative and have included more statements made by the company and its representatives. I have done the same for the new sections on Retirement Villages and on the owner's hotel businesses. As a consequence I have quoted from much more of this copyright material than I normally do as fair use.

I repeat here that one thesis of this web site is that likeable and charismatic people can be very successful in the marketplace where they may perform well for themselves and for society. I argue that these same people may perform poorly as providers of health or aged care when that care is provided in a marketplace context and is then evaluated in humanitarian terms. This is because the two contexts are incompatible and those who succeed do so by ignoring this incompatibility.

A good example of this is Peter Smedley and his role in Mayne Health. In the marketplace he was a hero but the application of his market thinking to health care was Mayne Health's undoing. I have therefore looked at the owner of Milstern's other successful business operations. I have included some material to illustrate that environment and the way success is achieved there. There are problems when operating in such very different sectors and I recognise the dilemma faced by those who try to do so.

The material is included for the reader to assess and make up his or her mind. I would welcome a response from Milstern and its owners in regard to this material and the selection of representative extracts. I ask them to put their perspective and respond to the concerns raised. This would be very valuable.

Clearly I am on one side of the divide in perceptions that I describe on another page on this web site. The arguments and assertions made are intended to stimulate debate. This site lacks input from the other side of the divide.

I am not in a position to clearly present the position and arguments of those on the other side as I am critical of them. I encourage Milstern to respond to the arguments on the web site. They are summarised in the link at the top of this page. I will include any comments they wish to make.

Milstern was a nursing home and retirement village operator founded in 1986.

Mrs Millie Phillips a self made businesswoman had made her fortune in mining. In the 1960s she developed an interest in nursing homes and retirement villages. She formed Milstern to acquire her health and aged care businesses and floated it on the share market. She became involved in the marketing of a diverse selection of products developed by an Israel researcher.

Dec 1986 Milstern lists

Mrs Millie Phillips, a survivor of the 1970s nickel boom, has again embarked on a public course with the proposed listing of Milstern Health Care Ltd which will seek 14 million $1 shares. At the launch of the prospectus yesterday, Mrs Phillips, the chairman, said she will take a "huge slice" of the float with Milstern Enterprises Pty Ltd, which she controls, taking 2.5 million shares as consideration.
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Capital raised will be used to purchase, for $7.35 million, all nursing homes operated by the Milstern group; partly finance and purchase the land for the construction of a $6 million retirement village in the Hills district in Sydney; and provide working capital for the marketing and distribution of Omiderm - a semi-permeable dressing for wounds.

Apart from property interests, which include four nursing homes and three retirement villages, Milstern has purchased the rights to four medical products and other diagnostic tools used to detect bovine mastitis and antibiotics in milk.
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Mrs Phillips founded the nursing home and retirement villages company in 1960 but is better known to the public for her long-standing association with the nickel exploration company International Mining Corp NL, of which she is chairman.
'Nickel Queen' On The Listing Trail Australian Financial Review December 3, 1986

Dec 1986 The business

After 10 years out of the limelight, housewife-cum-mining promoter Mrs Millie Phillips has re-emerged with a new company - this time a health care concern which is to raise $14 million from the public.

She hopes Milstern Health Care Ltd, the new retirement village and nursing home concern, will prove more profitable than her International Mining Corporation NL, which for the past five years has turned in consistent losses

The diminutive, Polish-born Mrs Phillips, whose net worth is said to be about $40 million, says she feels confident. Along with her mining activities, Mrs Phillips has "been in the health care business" for 20 years or so. And, she says, like IMC, she will "stick by the company until it makes money".

Australia's richest self-made woman earlier this year opened Rose Bay Towers as serviced retirement apartments - which ultimately will also be sold into Milstern along with other properties held by interests associated with Mrs Phillips, including The Ritz Nursing home at Leura.
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To show she means business, Mrs Phillips will put up $4 million to take 4 million shares in Milstern, with a further 2.5 million shares allotted to her as consideration for medical products including Omiderm, the skin dressing developed in Israel for which a company controlled by Mrs Phillips has the exclusive Australasian agency.

Ultimately, she will emerge with about 39 per cent of the company.
MINER MILLIE EXPANDS IN HEALTH CARE Sydney Morning Herald December 3, 1986

Feb 1987 The listing

Milstern Health Care Ltd had a lacklustre day, but its $1 shares did open at $1.05 before falling to $1.02 at close.
FINANCIERS KIND TO STAGS Sydney Morning Herald February 13, 1987

Mar 1987 Millie Phillips and Professor Citri

However Mrs Phillips projects the bulk of Milstern Health Care's profits will come from the exploitation of the world-wide rights from research conducted by Professor Nathan Citri, a microbiologist from the Hebrew University of Jerusalem.

At least 10 per cent of the profits from nursing home operations will be ploughed back into the marketing of the health care products and the testing kits developed by Professor Citri.
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Apart from the purchase of nursing homes and retirement villages and construction of an addition retirement complex, the capital raised from the listing and the some of the operating revenue from the retirement homes will go to developing and marketing test kits and wound dressings which Mrs Phillips hopes will be the company's major source of revenue by the 1988-89 financial year.
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Since the prospectus was issued Milstern Health Care has signed an agreement with the CSIRO for contract research into the use of the Citri reagent in a field kit to detect bovine brucellosis.

An agreement has also been reached with the NSW Dairy Corp to undertake development work, laboratory and field trials for another Citri product which tests antibiotic residue in milk.
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The prospectus estimates profit for the first six months as a listed company will be $448,000 with net profit in the year to June 1988 of $1.99 million.
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As the architect of the new venture Mrs Philips confesses that she also does not fully understand the finer technical points of research despite the fact she has backed Professor Citri's work for the past few years.

However Mrs Philips remains very confident that her new venture will be a big success.
Millie Phillips Takes A Healthy Look At Profits Australian Financial Review March 3, 1987

May 1987 A new Citri test for AIDS

The research aims to develop a new detector of the AIDS virus invented by Professor Nathan Citri of the Hebrew University of Jerusalem.

Milstern has funded Professor Citri's research for the past 18 months and holds the world rights to the Citri patents and potential franchises for pharmaceuticals companies that would later market the device.
MILSTERN TO DEVELOP AIDS KIT Sydney Morning Herald May 28, 1987

May 1987 AIDS Test

Milstern Health Care Ltd will fund the development of its new AIDS test in conjunction with St Vincent's Hospital in Sydney. This development has the potential to put AIDS testing kits in pharmacies.

Yesterday's announcement explains the huge increase in Milstern's share price.
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Milstern's resident medical specialist, Dr M. Garvan, said yesterday that if the test kits did not reach the stage where they were on sale to the public it would be for political rather than practical reasons.
Milstern Will Fund AIDS Diagnostic Kit Australian Financial Review May 28, 1987

Takeovers, share sales and delisting from stock market:- There was no more mention of the Israeli professor and his many research inventions. In 1988 Milstern wrote off a large sum and was taken over at 65c a share by Namark of which Mrs Phillips son was managing director. Following this Mrs Pillips owned 92.2 percent of Milstern. To keep the company listed she sold some of her shares.

The company suffered during the market collapse of the 1980s and came into dispute with the Commonwealth, about fees. In 1993 the companies shares were suspended and it was then delisted. Information about the company became scanty for some years.

Oct 1987 Not meeting projections

Milstern Health Care Ltd posted a maiden net profit of $278,000, which was below the projections made in the company's prospectus.

However, the group's operations started two months later than anticipated, and the results took into account only five months of trading.
MILSTERN MAIDEN RESULT Australian Financial Review October 1, 1987

Sep 1988 A loss and write off of research

In its second full year of operation, Milstern Health Care Ltd has posted a 42 per cent increase in pre-tax profit to $725,000, on turnover of $16.32 million.
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However, Milstern suffered extraordinary losses of $3.5 million, taking the company's total consolidating operating loss to $3.22 million.

In accordance with a decision made in the first half of the year, Milstern wrote off all capitalised research, distribution and prospectus costs as extraordinary items.
MILSTERN EARNS MORE BUT OMITS DIVIDEND Australian Financial Review September 8, 1988

Sep 1988 Takeover by a family company.

Unlisted Mamark Holdings Pty Ltd has increased its offer for nursing home and retirement village developer Milstern Health Care Ltd to 65 a share.
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The managing director of Mamark, Mr Robert Phillips, said that the revised offer, which values Milstern at about $10.75 million, was more than fair, considering the rapid increase in Milstern's share price.
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Mamark has already taken control of Milstern with 48.9 per cent of issued capital.
MAMARK LIFTS ITS OFFER FOR MILSTERN TO 65 A SHARE Australian Financial Review September 1988

Apr 1989 What is this relationship?

Millie Phillips has sold down her commanding shareholding of Milstern Health Care Ltd in an effort to keep the nursing home and retirement village development company listed.

Yesterday Milstern Enterprises Pty Ltd announced that it had reduced its stake in Milstern, floated by Mrs Phillips in 1986, from 92.2 per cent to about 89.12 per cent by selling 2.5 million shares for 65c each or about $1.6 million.

Mrs Phillips' son and Milstern's managing director, Mr Robert Phillips, yesterday said that the private company had sold down its stake to keep Milstern Health listed, and would continue to sell to reduce the stake to 85 per cent.
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The extra shares now held by Milstern Enterprises appear to have been gained through a takeover bid of 65c a share made last year by Manmark Holdings Pty Ltd.
PHILLIPS REDUCES HER MILSTERN HEALTH CARE STAKE Australian Financial Review August 11, 1989

Aug 1989 Fee disputes

Milstern's nursing home and retirement villages have been operating satisfactorily. It benefited from the buoyant Sydney residential market and settled a number of fee disputes with the Commonwealth during the year.
MILSTERN UP BUT SHORT OF FORECAST Australian Financial Review August 31, 1989

Apr 1990 Downturn of late 1980s

Millie Phillips' Milstern Health Care Ltd has been affected by the poor residential property market and high interest rates, with its pre-tax profit falling to just $62,000 for the half to December 31.

That almost break-even result, recorded on sales which fell by 7 per cent to $16.2 million, compares poorly with the $1.2 million pre-tax profit reported for the previous corresponding half.
PROPERTY PROBLEMS AFFECT MILSTERN Australian Financial Review April 3, 1990

Feb 1991 Profits up

A substantial drop in interest charges has helped Mrs Millie Phillips'Milstern Health Care Ltd report an improved pre-tax profit for the six months to December 1990, up from $64,000 to $568,000.
INTEREST CUT BOOST FOR MILSTERN Australian Financial Review February 13, 1991

Aug 1993 Removed from stock exchange

"The above company whose securities are already suspended have not paid their Annual Listing Fees for the year commencing 1 July 1993."
MILSTERN HEALTH CARE LIMITED: ASX MARKET RELEASE - UNPAID ANNUAL LISTING Australian Stock Exchange Company Announcements August 24, 1993

Millie Phillips was clearly a remarkable and forceful woman. Her efforts deserve our admiration. Left destitute with two children, she borrowed and then made her fortune in Nickel before turning to health and hotels.

Dec 1986 Mrs Phillips career

From a standing start - a marriage break-up had left her with two children- she had made her first million within five years.

Over the years, IMC has had its ups and downs - mostly downs - with a low point coming when Mrs Phillips was charged with insider trading. She bought 4,000 shares a fortnight before the Trough Wells assays were announced, adding to the 2 million she already held.

The charges were dismissed, but Mrs Phillips never sold those shares, watching their price plummet from $10 to 10c. And neither has she sold down her holding or relinquished her role as chairman of IMC, although the company has been in and out of gold, nickel, uranium and a variety of other commodities.
MINER MILLIE EXPANDS IN HEALTH CARE Sydney Morning Herald December 3, 1986

Aug 1991 Australia's richest woman

Millie Phillips, is not on the BRW list but is often cited as Australia's richest self-made businesswoman, and possibly the only woman to forge a career in the largely male-dominated investment sector. Phillips borrowed from a bank in 1961 to buy a small boarding house in Sydney's Ashfield. She had just separated from her husband and had three children to support.
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Phillips also runs International Mining Corporation, a gold and metals exploration company.

Polish-born Phillips, the first woman to be charged with insider trading in Australia in 1974 (the charges were later dismissed), is said to be worth over$40 million.
AUSTRALIA'S RICHEST WOMEN Sun Herald August 25, 1991

Aug 1999 More about Phillips

After Phillips separated from her husband in the early 1960s, she took a bank loan to open a boarding house in Sydney while supporting her two children. She made her first million within five years. International Mining Corporation was listed in 1970, on the day that shares in the nickel mining company Poseidon hit $200. The company was delisted in 1997; at the time, Phillips was still running it.
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In the 1990s, Milstern opened Rose Bay Towers in Sydney, a block of serviced apartments, and the Ritz Nursing Home at Leura, New South Wales, plus several retirement villages in New South Wales and Queensland. As well as her involvement in the mining and health-care industries, Phillips was the owner of Castle Hotel Group and chaired the hotel group Flag International.
Where Are They Now? MILLIE PHILLIPS Business Review Weekly August 13, 1999

Two of Canberra's largest and most prestigious hotels were acquired by Mrs Phillips and her son Robert's other companies. They were also a catering business which provided catering to the old parliament and to the National Library. The conflicts, and the ups and downs in the hotel marketplace are described in the press as are staffing issues. One of the concerns on these web pages is the consequence for sick or aged citizens when health and aged care markets experience similar conflicts, ups and downs, as well as the disruption when they are traded from one owner to another in the marketplace. What would have happened to aged care residents had nursing homes been involved in the sort of dispute described in the press reports in this section?

Of interest is the relationship between owners/management and staff. Care in health and aged care is heavily dependent on the dedication and motivation of the staff. Relationships need to be different to those in the wider marketplace. Staff also need greater security and continuity. Problems can arise in the provision of care if management does not share the humanitarian mission in the same way as their staff.

The Canberra International Hotel

The Canberra International Hotel opened in 1981. It was acquired by the McGauran family business in 1988. Father and two son's were prominent conservative National Party politicians. Peter McGauran has been a minister in the Howard government for some time. His brother Senator Julian McGauran created some political flack when he defected from the National party to join John Howard's liberal party.

The hotel was purchased by Mrs Phillips and her son Robert when the McGaurin company restructured by going into receivership. It was turned into 162 strata units. These were sold independently.

Apr 1988 McGauran family buy hotel

The McGauran Group, motel and hotel owner, has paid $16.25 million for the Canberra International Hotel.
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The Canberra International, which fronts Northbourne Avenue, was opened in 1981 and extended in 1984. It has 152 rooms, including five suites, 36 guest apartments and an inground swimming pool.
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A spokesman for the group said that the Canberra International would be substantially refurbished.
MCGAURAN BUYS CANBERRA INTERNATIONAL Australian Financial Review April 5, 1988

Aug 1988 Politics and the McGauran family background

Peter McGauran is assured of at least one vote in any spill as his brother Julian is a senator. Young Peter and his brother Jules, from the Western Districts of Victoria, are reputed to be the wealthiest men in Parliament.
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Peter, Jules and their dad handed over $17 million for the Canberra International Hotel on the weekend, which may bring in a few more votes among the waverers.
BLUNT AND SHARP WAIT IN THE WINGS Sydney Morning Herald August 2, 1988

Apr 1993 McGauran group in receivership

The McGauran family's Rathdowne Melbourne and Downtowner hotels and their Canberra International hotel have gone into receivership, with the ANZ bank this week appointing an agent as mortgagee in possession for the hotels.
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The outgoing co-manager of the McGauran group of companies and newly elected National Party senator, Julian McGuaran, said yesterday that the company had negotiated the receivership with the ANZ.
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Mr McGauran said the company's decision to restructure had also been shaped by his return to politics, which would effectively take him out of the running of the companies and reduce its management team.
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The group will be run by Mr Gauran's father, John McGauran, and brother, John junior, when Mr McGauran moves to Canberra soon.

Mr McGauran was a Victorian National Party senator from 1987 to 1990.
ANZ Steps In At McGauran Hotels In Debt Rejig The Age April 3, 1993

Mar 1994 Hotel bought by Mrs phillip and her son. Strata units sold to investors

The sales of 95 out of 162 strata units in the Canberra International Hotel at 242 Northbourne Ave brought in about $13.5 million for Sydney hotel investors Mrs Millie and Mr Robert Phillips.

Their vehicle, Jaywood Pty Ltd, bought the hotel for about $11 million in May last year. The remaining units are on the market at between $123,950 and $219,950.
HOTEL STRATA UNIT SALES TOTAL $13.5M Australian Financial Review March 24, 1994

Mar 1997 Profit and staffing problems - Defamation threat

The Canberra Rex and the Canberra International Hotel have been laying off staff because of heavy losses.

The Canberra Times has obtained documents to this effect and statements from former and current employees. These indicate that the hotels are ex-periencing difficulties, though the owner says they are going better than ever.

The hotels with 156 rooms each and about 300 permanent and casual employees have been operating with minimum staff.

A letter from former general manager Michael Toomey, dated February 19, explains how he was instructed by the owner, Millie Phillips, to change the Canberra operations.

"The heavy losses the group have experienced of late have forced the inevitable streamlining of our Canberra operations," Mr Toomey told the employees.

"We regret we have no alternative but to make your position redundant effective immediately and enclose two weeks' pay in lieu of notice plus accrued annual leave and the like."

Mr Toomey has since left the company, which trades in Canberra as Castle Group Canberra. The Castle Catering Group also provides catering at Old Parliament House and the National Library.

Mr Toomey has confirmed that more than 15 employees have been made redundant. Former and current employees confirm this, and say many more have since left.

Staff say the hotels are running without a general manager but are achieving 50 to 80 per cent occupancy.

The hotels are understood to be being downgraded from 4-star to 3-star and staff have been told the difficulties are short-term.
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Asked about the information from staff, Ms Phillips said hotel operations were not changing and were going "better than ever".

"If they are unhappy about getting redundancies they should work a little harder," she said.

She referred questions to her Canberra solicitors, Vandenberg Reid, but the firm did not return telephone calls. Instead, the solicitors threatened legal proceedings against The Canberra Times.

The Rex is one of Canberra's historic hotels and its guests have included former United States president Lyndon B. Johnson.

Some employees have been told that death and disability benefits attached to their superannuation cover are at risk because the company has not paid January's contributions. Ms Phillips and her lawyers have declined to comment on this.

A letter from HostPlus Superannuation Fund to an employee said insurance cover for death or permanent disability was unavailable if the employer missed payments, and the employer, Milstern Health Care Ltd (Canberra Travelodge), had not paid the contribution.
Canberra Hotels In Trouble, Staff Lay-offs Canberra Times March 19, 1997

Apr 1997 Hotel feeling the decline in bookings

Canberra, Australia's Capital, is seeing positive developments in its tourism and accommodation industry. - - - - Subsequently, employment in the market has also risen, from 221 staff members to a remarkable 2,354.
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The Canberra International Hotel is one hotel that is feeling the brunt of a decline in bookings, although in general, its occupancy rate remains steady.
Three star hotels lead growth in ACT accommodation Business Sydney April 7, 1997 FROM ABSTRACT by ABIX (Business Intelligence Australia Pty Ltd)

Feb 1998 Now fully booked

Canberra's tourism industry is experiencing its busiest time in three months with major events in the city forcing some hotels to turn away guests. - - - - the Canberra International Hotel also are fully booked.
Boom Time For Hotels Canberra Times February 4, 1998

As a consequence two hotels were run in the same premises. A six year very costly court battle followed. At the end of this the judges ruled that although the original brochure had contained "glowing puffery" that should have been ignored, the financial losses were due to the market and could not be blamed for this. He indicated that management deficiencies had contributed to the losses but indicated that the investor's claims had not been made on this basis.

The court decided in favour of Mrs Phillip's companies and huge costs were awarded against the investors. The saga is interesting in what it reveals about marketplace disputes. Had this been nursing homes or hospitals would these payments have placed pressure on the funding for patient care? Would management's focus have been diverted from care to market concerns? Would "glowing puffery" have been recognised as such by anxious seniors and their families? Would the law view this in the same way?

May 1999 Precipitate closure when owners installed a new manager

Guests at the 156-room Canberra International Hotel in Northbourne Avenue, Dickson were shown the door last weekend when management walked out, leaving no-one to run the hotel and threatening its short-term future.
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The walkout follows a decision by the 109 owners of the rooms at the Canberra International to replace its management company with the Premier Hotel Group, which runs the Diplomat.

The changeover has not been smooth.
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The Canberra International was strata-titled in 1993 when individual rooms were sold to investors at a guaranteed annual return of up to 10.5 per cent for five years.
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The guarantee period ended last December and unit owners have not been happy with arrangements since.
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"But we certainly expected to do better under new managers than was offered by the old management." The owners did everything they could to ensure a smooth transition from the previous managers to the new. "We were still negotiating [last] Saturday night."

Paul Green, of law firm Meyer Clapham, which represents the former management company and its principal, Millie Phillips, said the unit owners had not thought through the changeover arrangements.

"The management was given an ultimatum to get out by 10am he said.

"They own the business name, the phone lines, the fax lines and, I think, every stick of furniture except those in individual rooms. They own the paintings on the walls."

Mrs Phillips, who also ran the Canberra Rex, had put a lot of money into painting and maintaining the hotel. She owned 42 Canberra International units as well as most of the public spaces, including the reception area, manager's office, restaurant, dining room, conference rooms and kitchens.

"She feels she's been harshly treated," Mr Green said.

These public areas might have to be sold. "Whoever buys them controls the hotel," he said.
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The hotel is expected to reopen on May 24, trading as the Pavilion on Northbourne.
Management Out, So Guests Told To Leave City Hotel Canberra Times May 8, 1999

Nov 1999 The court saga commences

The 16 investors - whose numbers could soon swell to more than 30 - are suing Filaria Pty Ltd, the company which sold them units, and the Independent Group, which handled the sales on Filaria's behalf.

Some of the investors are also suing individual sales representatives employed by the Independent Group and the solicitors they, the investors, engaged to handle purchases on their behalf.

Filaria Pty Ltd is associated with the owner of the Canberra Rex, Millie Phillips. Mrs Phillips owns 42 of the Canberra International's units. Another related company, Jaywood Pty Ltd, which held a lease over the public areas of the hotel, managed the serviced apartments until May this year when the 109 unit holders terminated the arrangement.
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One (Canberra law firm) has issued a number of notices under the corporations law asserting that the contracts between investors and Filaria are voidable because of Filaria's alleged failure to issue a prospectus when the units first came on the market. The prospectus issue also figures in the Supreme Court claims.
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The claims lodged with the Supreme Court allege misrepresentation, misleading and deceptive conduct and false representations on the part of Filaria, the Independent Group and various sales representatives.
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The false or misleading representations allegedly relate to the use to which units could be put and their long-term investment potential, among other things.

The investors are seeking unspecified damages and declarations that their 1993 contracts with Filaria are void.
Hotel Unit Holders Hone Legal Swords Canberra Times November 19, 1999

Nov 1999 Conflicting views

Wrangling over the once great Canberra International Hotel in Northbourne Avenue steps up a level this week when 42 of the 156 studio apartments split off to become a separate motel-within-a-motel.

The owner of the breakaway 42 units and former manager of the Canberra International, Millie Phillips, is to launch the Budget International Motel offering her rooms for $55 a night.

The going rate for other rooms at the hotel is $115.

Now trading as the Pavilion on Northbourne, the hotel has struggled to attract business as Mrs Phillips took with her the registered name, phone numbers and client records, all of which she owned.
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As the hotel struggles, small investors who depend on the apartments say they are suffering. Unit owner Iain Blackadder said he and his fellow investors were "bleeding".

"We have had no income from our investment since April and some of us are on interest-only loans."

He said the unit owners spent more than $100,000 on refurbishments after Mrs Phillips left. "It was very rundown."
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A spokesman for Mrs Phillips, Paul Green, of law firm Meyer Clapham, said, "When Mrs Phillips ran the hotel, the unit holders received a return.

"Since she was removed, they have received no payments.

"Everybody's a loser."
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The chief executive officer of the Premier Hotel Group, Peter Barter, questioned whether Mrs Phillips would be permitted to run the Budget International Hotel from Studio 101 of the hotel.

"It's not in the lease purpose clause," he said.

Mrs Phillips was unmoved.

"The new managers are there illegally anyway," she said.

Mrs Phillips claims ownership of the common areas of the hotel including the restaurant, reception, office areas and function rooms.

"They haven't paid for its use yet." Many of the unhappy unit owners have launched legal action.

They claim they would not have invested in the units had they known how it would all turn out.
Hotel's Woes Continue As Ex-manager Opens Motel Canberra Times November 28, 1999

Mar 2002 A small win for the investors

The long-running dispute between the owner of the former Canberra International Hotel and investors in what is now the Pavilion on Northbourne has seen the ACT Supreme Court refuse to place the latter in the hands of an administrator to end a two-year impasse. The dispute between Millie Phillips's company, Filaria Pty Ltd, and the large number of owners of units at the Pavilion has led to the bizarre situation of having two unrelated and rival hotels operating in the one building.
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The upshot was that Filaria began operating the Budget International Hotel, while Premier managed the Pavilion on Northbourne, both from the same premises.
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Claiming the arrangement was intolerable and that the original concept of the Canberra International Hotel had been destroyed, Filaria instituted proceedings seeking the appointment of an administrator of the body corporate representing the investors, which the investors resisted. Chief Justice Miles said the present situation was essentially of Filaria's making. Neither the investors nor the body corporate had asked for Budget International to be established.
Hotels in bizarre legal impasse Canberra Times March 11, 2002

Jul 2002 The dispute and its implications

Ms Phillips is embroiled in what could be the largest and most complex series of cases yet heard in the ACT as many of the owners of units in the Pavilion on Northbourne Hotel & Serviced Apartments battle to recover their investments.

The cases could have dramatic implications for the broader real estate industry, for they pose the question of whether developers, agents or owners should be liable for misrepresentation if a property which is described simply as a "good investment" ultimately proves otherwise.

Fifty-nine of the investors have actions against one of Ms Phillips's companies, alleging misrepresentation over how their units could be used and over how profitable they would be.
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At the same time, a smaller group of investors in the hotel have launched their own action arguing that because no prospectus was provided at the time they bought their units, the sales breached Corporations Law.

(Today such a scheme would unquestionably require a prospectus but these units were bought before the introduction of the Managed Investments Act.)

All the defendants deny the allegations. What is not in dispute is that the units have proved an ugly investment.
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But when the guarantee expired the trouble started. At a memorable meeting, Ms Phillips told investors that the Canberra hotel market was in the doldrums and, with new competitors coming into the market, she could no longer meet their expectations. The investors revolted and terminated the management agreement.

Most signed new agreements with a new operator; some elected to manage their own. Ms Phillips, who owns 42 units in the building as well as the nearby Rex Hotel, went her own way.
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First the hotel closed altogether. And since reopening, it has been plagued by disputes between the investors and Ms Phillips over basic hotel necessities, such as the telephone system, the restaurant, the office and the function rooms.
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Worse, Ms Phillips is undercutting the investors by offering her rooms at a base $55 a night.

For investors, the results have been disastrous. One owner, who had been banking $1,000 a month in income is now receiving just $320. Sure, they earned big incomes while the guarantee was in place but many, who financed the properties up to the hilt, are today battling to fund the mortgage.

Another investor, a former school teacher in his late 70s, has gone back to work to maintain the units that were supposed to maintain his retirement.

Values have been savaged. One investor believes her unit - for which she paid $123,000 - might now be worth $60,000.
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"This case is chewing up huge legal resources and potentially very high costs millions of dollars to the loser," said Ms Phillips' solicitor, Myer Clapham managing partner Paul Green.
Property - Hotel row evolves into legal saga. Australian Financial Review July 13, 2002

Nov 2003 A win for Mrs Phillips

In October, the investors failed to convince the court that the transactions they had entered into should be set aside because of breaches of Corporations Law provisions designed to protect investors from dubious investment schemes. The ACT Court of Appeal dismissed last week their appeal against the October ruling. However, the investors' claims of misrepresentation and misleading and deceptive conduct remain alive and have been the subject of a lengthy but unresolved Supreme Court hearing this month. The investors were ordered by the Court of Appeal to pay the costs of Filaria and Jaywood.
Court dismisses appeal by apartment investors Canberra Times November 1, 2003

Jun 2004 An expensive defeat for investors - Judges conclusions and criticisms

A large number of investors in a serviced- apartment project in north Canberra have suffered a second expensive defeat in the ACT Supreme Court in their bid to recover their losses from the developer and a real-estate agency. The court has dismissed claims by four investors that they were the victims of misrepresentation and false and misleading by Filaria Pty Ltd, a company associated with developer Millie Phillips, and the Independent Group Pty Ltd. Several months ago the ACT Court of Appeal dismissed claims by 11 investors that their transactions should be set aside because of breaches of Corporations Law provisions designed to protect investors.
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Justice Crispin said it was understandable that investors were acutely disappointed at the poor returns on their investment. However, their losses - which occurred in and after 1999 - were not attributable to misrepresentation or false or misleading conduct in 1993 or at all.

Allegations that rents had been set at unsustainably high levels and that profit projections had been unrealistic and wrong had not been established. ''The losses which the plaintiffs have sustained seem to have occurred substantially because of management decisions taken in 1999 and a failure to provide the necessary funds to adequately maintain the hotel,'' the judge said. ''The events of 1999 seem to have left the plaintiffs with considerable resentment against Ms Phillips but no cause of action based upon those events was pleaded.'' Instead, the plaintiffs had sought to disclaim responsibility for both the decision to purchase the units in the first place, and for management and maintenance decisions, and to attribute their losses in 1999 ''to some fault on the part of one or other of the defendants in 1993''. ''No adequate basis for these contentions has been demonstrated.''
Case lost against units developer Canberra Times June 16, 2004

Dec 2004 Punitive costs awarded against investors

Four of the 60 investors in a serviced apartment project in Braddon have been hit with a crushing costs order over their failed litigation against developer Millie Phillips and a real-estate agency, the Independent Group.

The four investors and their lawyers, Gillespie-Jones & Co, were criticised yesterday by the ACT Supreme Court for unreasonably refusing to negotiate a settlement of claims the lawyers should have known were at best tenuous.
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An indemnity costs order is punitive in nature and is the highest the court can make. The four plaintiffs will have to pay something approaching the full legal costs incurred by their opponents since May last year, including those of a 28-day hearing in the Supreme Court. Hundreds of thousands of dollars are likely to be involved.
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In May 2003, Filaria offered to settle all claims against it by buying out each investor for $60,000 and paying everyone's legal costs. The offer was rejected.
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A second offer to settle, a few days after the hearing began, was also rejected.
Investors to pay hundreds of thousands, judge rules Canberra Times December 18, 2004

May 2005 Investors lose on appeal

Investors in a serviced apartment project in Braddon may be facing a legal bill of more than $4million as a result of unsuccessfully taking their case to the ACT Court of Appeal.

Canberra businesswoman Millie Phillips, one of the successful defendants, said the case should never have gone to court.

Her company had paid its lawyers $1.3 million. A substantial proportion of this might now be recoverable from the investors. She estimated the investors' own legal costs to be about $3.6million. ''The only worthwhile aspect were the legal fees,'' she said.
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The Court of Appeal has now dismissed an investors' appeal against Justice Crispin's legal rulings. It is yet to decide whether his costs orders were justified.
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The court said that an investment report prepared on behalf of the defendants, in which various assertions on profitability were made, had ''clearly contained glowing puffery that was appropriately to be ignored''. However, the investors' losses were the result of a depressed market and a falling out with Filaria, not what was contained in the brochure.
Project's investors facing $4m legal bill Canberra Times May 28, 2005

Aug 2005 Costs for investors reduced by appeal court

Investors in a Canberra serviced apartment project have rescued something from disastrous litigation against a developer and a real-estate agency, but only to the extent that their losses are not as bad as they might have been.
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But the ACT Court of Appeal has now overturned the judge's ruling. The three judges said that while the settlement negotiations had been confused and ''a mess'', they had been continuing.

The court's order means the plaintiffs must still pay the defendants' costs, but not at the close to full-cost recovery level previously ordered.
Court ruling eases 'crushing' losses for Pavilion investors Canberra Times August 11, 2005

The Rex Hotel

The Rex hotel was not involved in similar controversy. When it was time to pull it down and rebuild, it was decided to redevelop the site for apartment blocks. The project elicited some environmental objections and an outcry about asbestos. A compromise was reached.

Dec 2002 The story of the Rex Hotel

The Rex was built in 1960 at a site that looked out over empty paddocks and was the first significant building for visitors driving in to the national capital along Northbourne Avenue. Its guests have included United States president Lyndon B. Johnson, Prince Charles and many of the world's best-known leaders, personalities and entertainers, including Shirley Bassey, Sir Robert Helpmann, David Frost, Dame Margot Fonteyn, James Mason and The Seekers.
Canberra Rex enjoys its final festive feast Canberra Times December 26, 2002

Dec 1988 Bought by Mrs Phillips company

One of Canberra's best-known hotels, the Canberra Rex, sold last week for$12.75 million to Rebenta Pty Ltd, a company associated with Mrs Millie Phillips, the founder of the Milstern Group of companies.
REBENTA IN $12M CANBERRA REX BUY Australian Financial Review December 29, 1988

Mar 2002 Plan to build apartments - objections

A $40 million plan to redevelop the historic Canberra Rex hotel into a nine-storey 287-apartment complex has been unveiled for public comment.
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Proposed by Sydney developer Millie Phillips, the one-and two-bedroom apartments would be sold as long-term residences, not serviced apartments, at prices between $180,000 and $240,000.
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The plan for the Rex requires Mrs Phillips to surrender her Crown lease over the Braddon hotel site and apply for a regrant. The hotel would be demolished.
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The Braddon representative on the Local Area Planning Advisory Committee, Peter Conway, has objected to the proposal on heritage, traffic and occupational-safety grounds.
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But he said the major concern was the possibility that the 42-year-old building contained asbestos and he called for certification from Commonwealth and ACT safety authorities that the site was asbestos-free. - - - - - - - - The hotel was fined $5000 in the ACT Magistrates Court in 1997 for exposing employees to asbestos.
$40m redevelopment plan for Canberra Rex unveiled. Canberra Times March 20, 2002

Apr 2002 Development application

Hotel owner Rebenta Pty Ltd has submitted a development application to Canberra City Council seeking to demolish the Rex and construct 287 residential apartments.
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The Rex is located on a prime three hectare site on 150 Northbourne Avenue at Braddon in the heart of Canberra's CBD.

Rebenta, which is lead by national hotel owner Mrs Millie Phillips, bought the 31/2 star hotel in December 1988 for $12.75 million. The property previously traded for $2.395 million in 1983.
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The Rex was built in 1964 and at six-storeys, was one of the earlier multistorey buildings in Canberra.

It became famous as a stopover for visiting dignitaries, including the then United States President Mr Lyndon Johnson during his visit to Australia in 1966.
Flats For Canberra Rex Site Australian Financial Review April 9, 2002

June 2002 Objections

Turner Residents' Association president Mac Dickins said he feared the proposed 287-unit development would add to Northbourne Avenue becoming a "canyon of buildings". "It's going to be a very big, massive building, and there's very little open space. It's nearly all hard surface, and at the front the set-back is lacking in soft landscaping," Dr Dickins said. "It is out of character with the garden nature of the city and local people are very concerned about the build-up of traffic in the area."

Braddon Residents' Association acting chairman David Gordon said plans presented to the Inner-North Local Area Planning Advisory Committee last September by the developers had been largely acceptable, but the ones proposed now were very different. "The development is significantly more massive and covers the site to a much greater degree," Mr Gordon said. "The number of units is grossly excessive."

Neither the developer, Millie Phillips, nor architect Tom Kean were available to comment. However, Rex Hotel general manager Don Yourell reiterated that Mrs Phillips had not yet decided to proceed with the project and was first seeking development approval.
Locals baulk at Rex Hotel development Canberra Times June 2, 2002

Sep 2002 Compromises and approval

The Rex Hotel on Northbourne Avenue will be demolished early next year to allow for the construction of a 267-apartment complex, due to be completed by the end of 2004. Rex owner Millie Phillips said yesterday the hotel, built in 1960, would be demolished 'as soon as possible'. Approval for the development to proceed was granted by Planning and Land Management on August 28. The building will close early in 2003 and residual asbestos will be removed before the demolition work begins.
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- - - - the number of proposed apartments has been reduced to 267. Architect Tom Kean said the change was made to allow for more open space within the complex and the retention of some existing trees. The redesign was prompted by inner-north residents groups who had concerns about the original proposal.
Rex demolition to begin next year. Canberra Times September 7, 2002

Dec 2002 Government steps in to helps competitor.

The western area of Civic received a long-awaited boost yesterday with the ACT Government's announcement that the $140 million residential development on Section 6 had been given the go-ahead. Planning Minister Simon Corbell used his call-in powers to short-circuit objections to the development, saying further delays would not be consistent with community benefits.
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The project hit a sour note with developer Millie Phillips, who wondered why the trees on the Metropolitan site were worth less than the 'six scungy conifers' which had cost her 16 apartments at the 260-unit Rex Hotel development on Northbourne Avenue. 'In the end I sacrificed the units there because I did not want to put in another application and waste two more years,' she said yesterday. 'But I really would like to know why the minister can wave his magic wand for this development but not for mine.'
City West $140m plan gets go-ahead Canberra Times December 20, 2002

Allegations about breeches of the equal opportunities regulations in 2001 elicited an angry response by almost all those who were named. It seems that the regulations required excessively onerous documentation and these companies had refused to fill in the forms. Mrs Phillips who employed large numbers of women was outspoken.

Nov 2001 Mrs Phillips refuses to fill in forms

They are among 29 companies in the retail, transport, manufacturing and food and beverage sectors named in the annual report of the Equal Opportunity for Women in the Workplace Agency.
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"Those companies named for non-compliance will have to suffer the stigma of public exposure and the scrutiny of prospective employees who may regard them as being adversarial to women and equal opportunity," Ms Krautil said.

Managing director of one recalcitrant company, Millie Phillips of Milstern Health Care in NSW, said she did not have time to fill in the agency's forms. "It is not appropriate for a company such as mine to have to spend hours and hours and hours of filling in those forms. I've never done it," she said.

"I'm a self-made businesswoman, all my chiefs are women and 95 per cent of my staff is women. If anyone has a complaint, it's men in my organisation ... how much more womanised can I be? "I have told them every year, `I refuse, do whatever you want, name me, shame me' ."
Equal rights file shames firms Courier Mail November 1, 2001

Nov 2001 The act

Milstern Health Care, which operates the notorious Yagoona Nursing Home, is among 29 Australian companies named by the Equal Opportunity for Women in the Workplace Agency for its failure to obey the law.
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Milstern Health Care employs about 800 people around NSW and runs Yagoona, Leura and The Ritz nursing homes.
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The Act requires companies to report on programs and strategies aimed at employing women and improving opportunities in the workplace for women.
Home in breach of equal jobs Sunday Telegraph November 4, 2001

Nov 2001 Others support Mrs Phillip in her objections

ORGANISATIONS named in a government equal opportunity "shame file" have hit back, claiming they have been unfairly targeted simply because they refused to complete mountains of paperwork.
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Four of the five Queensland organisations named said they had active equal opportunity programs but did not have the time to return the paperwork demanded each year.
Shame on YOU - Companies hit back over `outing' in equal opportunity report. Sunday Mail November 11, 2001

Oct 2002 A repeat "offender"

The Equal Opportunity for Women in the Workplace Agency announced details of 28 companies in breach of equal opportunity legislation.

Agency director Fiona Krautil said the number of companies ignoring the needs and rights of women were declining, but many were repeat offenders.
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In NSW, 13 companies had failed to comply with federal Equal Opportunity legislation. They are: - - - - - - - - Milstern Health Care Limited [Sydney]; - - - - .
Women take on bosses over rights Daily Telegraph October 29, 2002

Milstern has been active in the Retirement Village marketplace. This sector suffered during the late 1988 economic downturn and investors were slow to return to it.

Sep 1993 Retirement vilages

The chairman of Milstern Health Care, Mrs Millie Phillips, said she had developed four retirement villages, the newest being Windsor Gardens at Chatswood.
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"The reluctance to lend to industries such as ours follows the badly considered loans made by banks during the excesses of the '80s," Mrs Phillips said.
LENDERS SHUT VILLAGE GATES Sydney Morning Herald September 25, 1993

Mar 1996 Owns nine villages

Windsor Gardens in Mowbray Road, Chatswood is Milstern's newest retirement village. Milstern has a chain of nine villages, providing all levels of care.
Villages Can Improve Quality Of Life For The Elderly Sydney Morning Herald March 16, 1996

CLICK HERE to go to the page describing these matters.

I cannot find any press reports on a later dispute with the Umrimbirra residents. An examination of the records of the Commercial and Consumer Tribunal reveals that there was a more recent dispute. An application by Milstern which was opposed by the residents was rejected by the tribunal. An examination of the document reveals that the tribunal found that Milstern had increased the charges for some items by 7% when the regulations specified that they could not be increased above the CPI (2.6%) without the approval of residents which they had not given. In rejecting the application on 11 December 2006 the tribunal was critical of management and expressed concerns that the manager of the home had made an implied threat.

CLICK HERE to download the tribunals findings

Nov 2005 Residents get political support

HEAVY-HANDED and arrogant is how Barry O'Farrell has described the treatment of residents at Lindfield Manor Retirement Village.

The State Liberal MP for Ku-ring-gai made a damning speech in State Parliament earlier this month after listening to residents' woes about increases in levies and alleged decreases in service.

Milstern Health Care manages the village and Mr O'Farrell accused it of unjustly raising its monthly levies two years ago.

Mr O'Farrell said residents had told him they were never informed that Milstern had taken its case to obtain the increase of $25 a week for each of the 44 units in the village to the NSW Consumer, Trader and Tenancy Tribunal.

This would bring monthly levies to $1160 a resident, he said.

"Residents were not present because they were not told the hearing was on," Mr O'Farrell said.
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Mr O'Farrell said residents also had said services such as afternoon tea and a monthly bus excursion had been cut.

Mr O'Farrell's speech enraged Milstern's retirement services principal Millie Phillips who has called for his resignation.

"He has ridden roughshod over all of this and he has misled parliament," she said.

Mrs Phillips said "99 per cent" of Mr O'Farrell's allegations were false and any complaints have come from only two residents.

She said resident committees had access to all of the village's financial documents and it took up to 18 months to negotiate how the money would be spent.

She said her next action would be to prepare a detailed written response to Mr O'Farrell's allegations.
O'Farrell blasts rise in levies North Shore Times November 18, 2005 ----- CLICK HERE TO LINK TO THE SPEECH IN NSW HANSARD 8th Nov 2005

Dec 2005 Minister for fair trading helps residents

THE Fair Trading Minister has joined a legal battle launched earlier this year by residents of Lindfield Manor Retirement Village.

Diane Beamer announced her office would pay for counsel to represent the residents in a Supreme Court appeal by the village's operator, Milstern Health Care.

The residents challenged a series of additional budget expenditures from Milstern during the fiscal years of 2004 and 2005.

The two camps faced off in May in the Consumer, Trader and Tenancy Tribunal, over last year's charges and the residents won an order for Milstern to repay $70,500 of additional charges in the form of cost overruns.

Most of the budget blowout originated from wages paid to kitchen staff.
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"In the circumstances I am satisfied it should not be left to the elderly residents to defend the action commenced by the operator," she said.

In the meantime, a similar case was heard before the Tribunal over blowouts to the 2005 budget for which Milstern also assessed the village's residents.

The tribunal in November ruled again in the resident's favour and ordered Milstern to repay the residents a total of $73,000.
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Milstern must pay by December 31 but its principal Millie Phillips said her company would lodge a similar appeal to the Supreme Court and hopes the two cases can be heard as one.

She said Milstern has done everything to conserve costs in light of residents' demands.

Regarding the kitchen staff wages, hiring people for two hours a day to serve meals would be near impossible to find, she said.

"Now they say we shouldn't have so many people in the kitchen but they have demanded so," Mrs Phillips said.
Minister joins residents' fray North Shore Times December 7, 2005

Sept 2006 Appeal court supports residents

Residents of Lindfield Manor retirement village won a court battle last week against the village's operator Milstern Retirement Services. - - - - - - - Milstern's appeal to the Supreme Court was dismissed.
Big win for residents North Shore Times September 20, 2006 CLICK HERE TO GO TO THE DEBATE ON THIS IN NSW HANSARD 20 SEPT 2006

The NSW Office of Fair Trading has supported the residents and funded them in the Supreme Court appeal by Milstern.

CLICK HERE FOR THE PRESS RELEASE BY THE OFFICE OF FAIR TRADING 14 September 2006

The Nursing Homes

Allegations about the company's nursing homes were aired in the press and in parliament starting in 2000. These were based on accreditation agency reports. All were denied and disputed by the persons mentioned.

Jul 2001 Allegations of profiting by reducing staff

The Sydney nursing home under scrutiny over its care standards sliced almost 10 per cent from its wages bill as revenue boomed, internal documents show.
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Now leaked figures from Mrs Phillips's company, Milstern Health Care Pty Ltd, have revealed the company significantly cut staffing between 1997 and 2000 despite enjoying increasing revenue which would come primarily from government subsidies.

The figures show that revenue at the Yagoona home jumped from $6.2 million in 1997 to $6.7 million up 8 per cent.

However, total labour costs were cut by 7.4 per cent, from $4.5 million to $4.2 million.

There were similar cuts at the group's other homes, The Ritz and Curie Nursing Home.

The Yagoona home hit the headlines after the Aged Care Standards and Accreditation Agency overturned a recommendation from its assessors that the home's accreditation be revoked because of poor care standards. This prompted the questions about Mrs Phillips's links with the Liberals.

The staffing figures tally with the original reports of agency assessors at Yagoona who reported that ``(the owner of the home) has been requesting that staff numbers decrease, and that the specialty (part-time) positions such as education and infection control also be decreased''.

``The (owner) informed the team that casual staff were not to be employed. She stated that staff had to become permanently employed if they wished to remain at the service.''

The assessors said there were ``appropriately skilled and qualified staff sufficient to ensure that quality care was given'' but there was an ``unpleasant work environment'' and that documentation and interviews ``reveal an environment of harassment from the approved provider throughout the organisation''.

The internal documents report that roster savings at Yagoona since May last year include cuts in educators, nurses and cooks, and that the first staff member to phone in sick on each shift except night shift is not replaced. The savings are estimated at $72,291 a year.

Two calls to Milstern Health Care Pty Ltd by the Herald were not returned.
Staff Cut As Aged Home Profits Rose Sydney Morning Herald July 10, 2001

Jun 2001 Allegations about friends in the right places

But the criticism of Mr Lang's appointment accompanied revelations that a Sydney nursing home had escaped imposition of sanctions by the ACSAA, despite the highly controversial deaths of two patients.

The home is one of two such institutions operated by a firm owned by Mrs Millie Phillips, another friend of the Minister and Liberal Party contributor.

Staff and others had made repeated and long-standing complaints about substandard facilities and treatment regimes at both homes which had failed to pass accreditation tests by the end of last year.

However, ACSAA assessors are said to have told the staff of one of the homes that "the owner knows people, nothing will be done". Both homes were subsequently given generous reprieves of several months to achieve accreditation standard.
Aged care scandals erupt again The Guardian June 27, 2001

The Ritz Nursing Home

Dec 2000 Accreditation status threatened

The future of one of NSW's biggest nursing homes is in jeopardy after it was told it would fail accreditation unless it made major improvements in the next three weeks.
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Residents and relatives will be told officially today or tomorrow that Mrs Millie Phillips, proprietor of Milstern Health Care Ltd, has been put on notice to improve the home by December 31 or fail accreditation.
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While patient care at the privately run Ritz is considered acceptable, the home's physical environment was found unacceptable. This covers matters such as the provision of a safe and comfortable living environment, infection control, catering, cleaning and laundry services, and fire and security systems.

A ``site audit'' report was made in August, and the department has visited several times since. The Federal Department of Health and Aged Care is writing to inform residents and relatives, and to reassure them that contingency plans are being made.

Mrs Phillips could not be contacted. But a Milstern spokeswoman said ``both the department and the company are committed to maintaining the excellence of patient care. The department has been supportive, and our current discussions involve significant extensions.''

It is believed carpenters are working at The Ritz, which Milstern has owned since 1972.

Mrs Phillips met departmental representatives on Monday. ``It appears she is not going to throw in the towel,'' a department spokesman said.

``It is still open to her to convince the [Aged Care Standards and] Accreditation Agency that she can achieve the standards.''
Putting Heat On The Ritz, A Nursing Home In Peril Sydney Morning Herald December 6, 2000

Feb 2001 Half the staff lodge a complaint

More than 70 staff at a Sydney nursing home have written to the Federal Government's nursing home complaints body to express a lack of faith in their proprietor.

The unprecedented action by more than half the staff comes on top of a Federal audit of The Ritz Nursing Home in Leura that refers to an ``environment of harassment'', staff claims of verbal abuse by management, and a long history of underspending on the home.
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Dilapidated furniture, grey sheets and small, cramped wards that ``compromise resident safety'', along with a long list of serious building problems, were detailed in a report by the Private Health Care Branch of the NSW Health Department late last year.

The lighting was poor, the floors unsafe, and the food servery was ``extremely dirty''. As well, there were not enough hand basins to ensure sound infection control.

Commonwealth documents revealed further problems ``which would have required a long period to develop or have existed for a long period''. Among them, according to the Aged Care Standards and Accreditation Agency, resident call bells were broken, there were not enough toilets or bathrooms, and food was served cold because of a lack of proper equipment.

Staff requests for essential items were ignored over a long period, the Commonwealth auditors reported in January. And major suppliers of food, bed linen and hardware had on occasions last year stopped deliveries to the Ritz because of unpaid accounts.
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In granting the Ritz a reprieve, the Department of Health and Aged Care noted that residents were not in immediate or severe risk, and that nursing care was satisfactory. Mrs Phillips was undertaking ``significant work'' to address problems. It also cited the difficulties of relocating the residents, many of whom had behavioural problems.
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Mrs Phillips has vowed to try again, saying her company will ``invest $2 million to build a new wing'', and that the issues will be rectified by early March.

However, Ritz staff who wrote to the Commonwealth's new Nursing Home Complaints Resolution Scheme in December are concerned that management style and systems will not change, even if the building is repaired.

As well, documents from Commonwealth audit inspections reveal the Ritz failed accreditation in December because of a long history of underspending on the home's residents and infrastructure. Officials doubted Mrs Phillips's plans to improve resident living standards ``could be relied upon'' to ensure accreditation ``within an acceptable time frame''.

Mr Ross Bushrod, the State manager of the Accreditation Agency, concluded in a report late last year that management was ``not actively working to provide a safe working environment''. He was concerned that ``after the currently planned remedies are implemented, other similar deficiencies will occur without proper management attention''. He cited, for example, the ``systemic failure to meet necessary repairs, maintenance, and standards'' in the kitchen until regulatory authorities demanded them.
---------------------------------
As well, the report by the Victorian-based auditors cites staff complaints about ``an environment of harassment''. Some felt victimised if they drew attention to problems.

Mrs Phillips told the Herald she had instituted legal action against the aged care consultancy IBIS which had managed her nursing homes for two years. Her two other nursing homes had received three-year accreditation. On her style of management, she said: ``Many of my staff have been with me for more than 30 years. If an `environment of harassment' existed, why would these people remain in my employment?''
Putting Down The Ritz: Aged Home's Chorus Of Critics Sydney Morning Herald February 21, 2001

Jun 2001 Given a reprieve

The Ritz nursing home in Leura, which she has owned for 30 years, was one of two homes in NSW to have failed to pass new nursing home accreditation standards by the December 31 deadline. At the last minute, it was given a six-month reprieve along with 19 other homes nationwide, and yesterday was granted accreditation for a 20-month period.
Grieving son says nursing home let his mother down Sydney Morning Herald June 21, 2001

Jun 2001 Problems not localised to the Ritz

The Ritz, in Leura, which she has owned for 30 years, was one of only two homes in NSW to have failed to meet accreditation standards by the December 31 deadline. - - - The Commonwealth assessors described a situation similar to the story at Yagoona staff requests for essential items ignored over a long period, and longstanding problems. Bushrod, the agency's State manager, wrote in a report last year about The Ritz, that he was concerned that ``after the currently planned remedies are implemented, other similar deficiencies will occur''.
Handle With Care Sydney Morning Herald June 23, 2001

 

The Yagoona Nursing Home

Jun 2001 A reprieve for a chronic offender

THE Yagoona Nursing Home near Bankstown has been a problem home for many years. In May 1996 the Herald listed it among the 25 worst homes in the State, based on reports by Federal inspectors. It failed 14 of 31 minimum-care standards in the mid-'90s under the old system of inspections.

It wa