Officials defend $900k contract recipient

Health officials have defended giving more than $900,000 worth of contracts to a company run by the man formerly responsible for an aged care home where a resident was found with maggots in her mouth.

Cooperage Capital Pty Limited has received two grants from the Department of Health this year on limited tender, to help look at financial pressures in aged care.

The company is effectively a one-man show run by Gary Barnier, former director of Opal Aged Care.

He is also a board member of the department's Aged Care Financing Authority.

Department deputy secretary Michael Lye told a Senate estimates hearing Mr Barnier received the grants because he had "real world" experience running aged care services.

"And we need, in the department, real world experience to understand the practical viability of individual facilities that might be at risk," he said on Tuesday.

Labor senator Kristina Keneally said Mr Barnier's experience included being the chief executive of Domain Principal Group, which ran a Sydney nursing home where a staff member pleaded guilty to lighting a fire where nine residents died.

A resident was found with maggots in her mouth at a nursing home near Newcastle run by Opal when Mr Barnier led the company.

Senator Keneally said he also had bullying allegations levelled at him while in that role.

"Is this the kind of real world experience the department was looking for?"

Aged Care Minister Richard Colbeck said he was aware of the issues but couldn't say if this was before the $900,000 in contracts had been awarded to Mr Barnier.

Mr Lye said the department had been aware of the bullying allegations but no findings were made against Mr Barnier.

But Senator Keneally said he had left the company before the investigation was finalised.

Mr Lye insisted due diligence was followed, saying Mr Barnier had helped the department identify aged care homes that were at financial risk.

"In our view, he has the appropriate skills and he has demonstrated the appropriate skill set to enable us to do that task," he told senators.

"We are very, very focused at this particular point in time in preventing organisations from ending up in administration and closing and leaving residents without a home."