AUSTRALIA | The Government has announced an investment to support the aged care sector, in order to deliver a higher standard of care for Australian seniors.
The Albanese Government is investing AUD $3.8 billion over four years to support the aged care sector and deliver a higher standard of care for older Australians, by funding pay rises for workers from the first of January 2025.
This AUD $3.8 billion investment will fund the Fair Work Commission Aged Care Work Value Case Stage Three decision, which is anticipated to benefit 340,000 aged care workers in residential and home care.
This funding builds on the Government's $11.3 billion commitment in 2023, to fund the previous 15 percent award wage increase determined by the FWC and is on top of the $5.6 billion announced by the Prime Minister last week.
Aged care workers will see these increases from the first of January 2025, with many workers receiving further increases from the first of October 2025.
Historic aged care reforms announced last week, in response to the final report of the Aged Care Taskforce, outlined a number of essential changes to improve the funding, viability, and quality of residential care.
Aged Care Minister Anika Wells said that through this additional funding, the government will support a sustainable sector that delivers high-quality care that older people can access when and where they need it.
“We are funding the Fair Work Commission’s Aged Care Work Value Case Stage Three decision, which will see award wage increases for many workers in aged care. This will in turn support recruitment and retention of aged care workers, and the delivery of well‑staffed and consistent high-quality care for older people in Australia,” said Minister Wells.
Ahead of those changes commencing on the first of July 2025, the Government will support residential aged care providers to meet the increasing costs of delivering care and hotelling services to older people in residential care settings.
From the first of October 2024, the Australian National Aged Care Classification (AN-ACC) price will be increased to AUD $280.01, which funds the FWC stage three increase as well as other cost increases. This represents a 13 percent increase in average daily funding and will also enable providers to meet the increase to 215 care minutes that also comes into effect on the first of October 2024. Overall care funding has now increased 58 percent since the ALP came to Government in 2022.
“These award wage increases apply to workers who provide more direct support and care to older people – personal care workers, assistants in nursing, recreational activities officers and home care workers,” said Minister Wells.
“They also apply to those workers whose roles support the running and functioning of residential care services – administration staff, drivers, maintenance staff and gardeners, laundry hands, cleaners and food services assistants.”
Changes to AN-ACC fixed and variable funding categories will also be implemented on the first of October to better align funding with costs, informed by 2024 to 2025 pricing advice from the Independent Health and Aged Care Pricing Authority (IHACPA). This will particularly benefit regional and rural services, which have higher care costs compared with services in metropolitan areas.
From 20 September 2024, the hotelling supplement will also increase from AUD $11.24 to AUD $12.55 per resident, per day. This includes AUD $1.09 to fund the FWC stage three increase. There will be a further increase of AUD $1.89 on the first of July 2025 to fund higher hotelling costs as announced on Thursday 12 September 2024.
These two increases will ensure providers are funded to deliver the cost of everyday living services, consistent with the recommendation of the Final Report of the Aged Care Taskforce that funding for daily living needs to cover the full cost of providing these services.
For the Home Care Packages (HCP) Program, the Government has earmarked AUD $400 million over four years to increase the Commonwealth portion of the home care subsidy. The subsidy increase will enable providers to pass on this historic wage increase to staff and ensure that care recipients will see no change in their services or hours of care.
Commonwealth Home Support Programme (CHSP) providers will be able to apply for a Grant Opportunity for additional funds. This will ensure that CHSP providers are supported in providing the wage increases to eligible staff.
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