Ageing Australia has made a series of recommendations ahead of tomorrow’s 2025-26 federal budget, aimed at relieving the ongoing workforce crisis in Australian aged care, transitioning to the New Aged Care Act and supporting sustainability.
The recommendations are designed to ensure the continued delivery of quality care now and in the future.
“Relieving the workforce crisis, transition to the new Support at Home Program and time to implement reforms properly are our absolute top priorities,” Ageing Australia CEO Tom Symondson said.
“Without enough time and funding to support the sector to transition properly, we risk sector instability, complications and confusion for both providers and older Australians.”
“All providers, from very small to very large, are likely to struggle if reforms are rushed. The sector needs certainty on what is required, funding and support for transition and enough time to get it done.”
“Our State of the Sector Report in 2024 showed 20 per cent of these providers were not confident in their ability to still be providing services in 12 months’ time.”
The recommendations made in this submission have been informed by the challenges and opportunities identified by aged care providers across Australia.
If adopted, these recommendations will ensure the aged care system is sustainable and equipped to meet the changing needs and preferences of Australia’s ageing population.
R1 Fund quality and sustainable aged care services
Support sustainable funding and optimise the implementation of the Aged Care Taskforce’s recommendations by:
- conducting the review of the Accommodation Supplement as soon as possible
- costing and funding high quality care, including new program administration and business costs, as per the definitions in the new Act
- ensuring residential aged care providers are adequately funded to meet the new requirements in the service list.
R2 Adjust funding settings for the Commonwealth Home Support Programme (CHSP) to ensure the CHSP sector remains viable
Revise the indexation arrangements for CHSP, as the 3.5 per cent indexation from 1 July 2024 was insufficient to address provider wages costs.
R3 Alleviate additional cost pressures on aged care from State-based taxes
Invest $391.5 million annually to re-introduce the Aged Care Payroll Tax Supplement paid to private residential care providers who, unlike not-for-profit providers, are not exempt from state government payroll taxes.
R4 Establish a taskforce to develop a National Aged Care Workforce Strategy
$0.5 million in 2025-26 to establish a National Aged Care Workforce Strategy Taskforce to undertake data collection, sector-specific projections and identify strategies to address gaps in skills, staffing shortages and changing care demands.
R5 Boost the aged care workforce across Australia, particularly in regional areas
Build a sustainable aged care workforce equipped to meet increasing future demand through:
- establishing an Aged Care Worker Attraction Fund to attract workers to the aged care sector, especially in rural and remote areas
- investing in training and skills development opportunities for aged care workers
- increasing funding for the Aged Care Capital Assistance Program to support capital works for on-site accommodation for staff.
R6 Improving access to migrant workers to build a sustainable workforce
$9 million over 3 years to establish:
- a sector-led migration advisory service for aged care providers to access and retain their migrant workers and
- an International Workforce Council to support cross-sectoral collaboration and develop innovative solutions to improve the aged care sector’s ability to access migrant workers.
R7 Transition support to enable providers to implement the new Act
This support should include:
- from the commencement of the Support at Home program, funding Care Management at 20 per cent of the consumer’s package value, for the first year to support transition and market stability
- $188 million for a transition supplement to support the aged care sector transition to the new Act. This supplement would help providers cover the costs associated with implementing the new Act.
R8 Funding for providers to support Information and Communications Technology (ICT) change
$600 million to establish an ICT grant program for aged care providers to meet the obligations of the new Act, comprised of $400 million for capital expenses (including system acquisition and upgrades) and $200 million for operational expenses (including training and skilled staff).
R9 Pilot hospital in the home in retirement villages
$2.5 million to fund a three-month pilot of integration of hospital in the home in eight retirement villages.
