New research highlights need for long-term plan for sustainable aged care sector

Release date: 17 Jun 2022

Aged care providers and consumer advocates have united to welcome new research that outlines the strategic response required to achieve a sustainable aged care sector that is able to deliver the care older Australians need for decades to come.

Sustainability of the Aged Care Sector: Discussion Paper examines the need for, and considers, options to achieve the long-term financial viability of age services in Australia.

The paper was prepared by the University of Technology Sydney (UTS) and was commissioned by Australian Aged Care Collaboration (AACC) which represents Aged and Community Care Providers Association (ACCPA), Catholic Health Australia, UnitingCare Australia, Anglicare Australia and Baptist Care Australia, with input from COTA Australia and National Seniors Australia.

The paper acknowledges that government spending on aged care will need to rise, but says a sustainable aged care sector can only be achieved through a multi-layered strategic response from the government, sector stakeholders and consumers.

“Australia needs to urgently address long-term funding of aged care or it will be condemned to reliving the past of short-term fixes and band-aids,” ACCPA Interim CEO Paul Sadler said.

“Funding fixes like the $18 billion in the 2021 Budget, while welcome, are not enough to address chronic workforce shortages and implement better standards that can be sustainable as costs increase and needs change.

“This means we need to start a national conversation involving consumers, aged care providers and other stakeholders in the sector, and government, about how the aged care system can be sustainably funded, and whether that means individuals contribute more to their own care,” Mr Sadler said.

Research commissioned by the Royal Commission found that a majority of Australians accept that more needs to be spent on aged care and indicated that they are willing to pay more if we are to receive the care we expect for our loved ones and ourselves.

The Royal Commission’s Research Paper 6 prepared by Flinders University surveyed 10,000 adults and found a majority support paying higher taxes to fund aged care while more than 70% support paying a higher co-contribution to access care.

“Short-term, band-aid solutions to aged care financing haven’t worked in the past and won’t work in the future. We need a shift to a financially sustainable system that together with other changes delivers the quality aged care to which older Australians and their families are entitled,” COTA CEO, Ian Yates AM said. 

“There’s no question that our aged care system is under stress and has been for a long time. Much of the system is underperforming. Adequate and consistent funding is necessary to underpin cultural and other essential changes. Unless we start having serious discussions about the long-term financial sustainability of aged care in this country we will not have an aged care system that delivers for older Australians.

“Older Australians have the right to an aged care system that allows and enables them to live their lives to the fullest and we need a sustainable system that makes that possible.”

National Seniors CEO Professor John McCallum said: “The evidence shows that most older Australians do plan for their retirement. However, they don’t often think about their aged care needs until they have to, often when their needs are urgent.

“Since consumers will be important players in the decisions on funding, we will need to improve older Australians’ awareness of costs and funding options for the needs of later life. This report is a good place to start for this initiative.”

The UTS Discussion Paper looks at taxpayer affordability; community satisfaction with the care provided; workforce availability; and provider viability.  Already there is an acute need to address chronic workforce shortages, to increase staff wages and conditions, to improve quality and safety, and to invest more to meet growing demand for care both at home and residential care.

The Discussion paper examines ways to achieve a sustainable aged care sector with a multi-layered response involving government, sector stakeholders and consumers through four strategic approaches:

·    Reducing the rate of growth of demand for subsidised aged care services. This could include supporting the personal independence of people as they age by investing in improving their wellness, supporting informal carers and facilitating opportunities to purchase non-subsidised top-up services.

·    Improving the effectiveness of aged care services. Approaches could include changing policy settings and program designs to produce better outcomes and thereby reduce the overall growth of expenditure on services.

·    Improving the efficiency of service delivery. Strategies could include attracting, retaining and training a highly skilled workforce, promoting consumer choice, enhancing competition and removing barriers to innovation so that higher levels of services can be produced for any give level of funding and workforce.

·    Establishing more equitable funding for subsidised services. Options include requiring consumers who have the capacity to pay to make fair contributions to the cost of services, whilst ensuring the services are affordable to all in need by maintaining appropriate safety nets.

View a copy of Sustainability of the Aged Care Sector: Discussion Paper.


Media contacts:

ACCPA - Jane Garcia 0455 111 593

COTA Australia - Alana Mew 0419 929 722 

National Seniors Australia - Craig Sullivan 0429 000 722

As the peak body representing church, charitable and community-based organisations providing accommodation and care services to older people, people with a disability and their carers, ACSA can be contacted for comment on issues affecting the industry.

Areas ACSA may provide media commentary on include:  

  • Aged care reforms
  • Residential aged care
  • Home care
  • Independent and retirement living
  • Housing for older Australians
  • Palliative care
  • The aged care workforce in Australia

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