Mixed Response from Aged Care Sector

Aged care groups have had a mixed response to the Federal Budget, with the spotlight cast on everyday living expenses for older Australians and the redirection of funds to support the aged care sector.

Among the changes set to affect pensioners is the introduction of a $7 co-payment for GP visits, a 13 per cent increase in PBS co-payments, lifting of the pension age to 70,  changes to aged care, the abolition of measures to improve housing affordability and changes to pension deeming rates and eligibility thresholds.

While the peak body for mission-based aged-care providers, Aged and Community Services Australia (ACSA) said the Budget had generally quarantined the aged-care sector from funding cuts, Combined Pensioners and Superannuants Association (CPSA)  said the Budget burden was heavily falling on the shoulders of those least able to afford it.  

CPSA was echoed by the CEO of seniors advocate COTA Australia Ian Yates, who said the Budget had no real strategy to address the ageing population and that reducing pensioners living standards was a poor substitute for a comprehensive strategy for an ageing Australia.

“The message to Australians tonight is: ‘if you get sick, you’ll pay. If you get old, you’ll pay. If you lose your job or acquire a disability, don’t expect to get support so easily,” CPSA Manager, Research and Advocacy, Amelia Christie said.

Christie said the removal of wage indexation of the pension (Age, Disability Support and Carer pensions) would have a devastating impact on pensioners, especially the two million who had no other income.

“Even the Commission of Audit didn’t go so far as to recommend removing wage indexation entirely,” she said.

“CPI does not reflect the purchasing practises of a pensioner, which is why the Pensioner & Beneficiary Living Cost Index (planned to be scrapped, too) was introduced in 2009. In other words, pensioners will see a real reduction in their income.”

COTA CEO Yates said older people would justifiably see the changes to the indexing of the aged pension, to begin in 2017, as a major attack on their quality of life.

“Far from ‘improving’ the pension system as the Government claims, the changes to the pension indexing arrangements mean pensioners will be $100 a week worse off in 10years,” he said.

“This is a massive cut to the income of older people who simply can’t afford to absorb it. As a result we will see many older people slip back below the poverty line.”

In its Budget response, the ACSA focused on the retention of the $1 billion Workforce Supplement in aged care, saying it would ensure that funding was fairly distributed rather than available only to those providers who had measures in place to access it under previous legislation.

CEO at Aged and Community Services Australia (ACSA), Adj Prof John G Kelly, welcomed the redirection of the funding to a 2.4 per cent ongoing increase in aged-care subsidies.

“ACSA has worked closely with the Coalition Government to ensure that the money assigned to the Workforce Supplement was put to the best use for the sector,” Kelly said.

“Tying it to industrial arrangements meant workers employed by smaller providers were not able to tap into the funds.

“ACSA has also advocated to the Commission of Audit and directly to Government for aged care funding to be quarantined from any cuts to meet the ever-growing demand for services.”

The organisation's major disappointments included the cessation of the Housing Help for Seniors Programme, removing $173 million over five years and the reduction in real annual growth in the Home Support Programme to 3.5 per cent from a level of six per cent from July 1, 2018, a change the organisation said it would be taking up with Government.

“There are many challenges ahead of us which concern how we provide consumer choice and fund the sector in a sustainable manner into the future. The Productivity Commission report on Caring for Older Australians discussed affordability, individual responsibility and a safety net for those of low means. We shall continue to advocate to achieve those aims,"  Kelly said.

Moves to improve the prospects of older workers were cautiously welcomed by COTA Australia and CPSA, who flagged the impact of rise in the pension age as a concern.  

COTA Australia CEO Yates said many older workers would welcome measures to provide business with $10,000 incentives to employ older workers.

“Sadly, the fact is that age discrimination is still a big issue in Australia and any measures which encourage employees to consider employing an older person will benefit society as a whole,” Yates said.

“If people will have to keep working until they are 70, a range of measures need to be put in place to make sure there are jobs for them.

“What is missing from the Budget is measures which provide retraining to older workers or address the needs of older people to have more flexible working arrangements as they age. The Government will need to make these a priority long before the pension age rises,” he said.

CPSA CEO Amelia Christie said the organisation was keen to see how successful the Restart program would be in reducing mature-age long-term unemployment.

“CPSA welcomes the Restart program to help mature-aged unemployed people get jobs. It is good to see that the $10,000 incentive payment for employers will be spread over two years, which will encourage employers to retain jobseekers over the long term,” she said.

Treasurer’s Budget speech is HERE

The details of the Budget’s Social Services package can be found HERE

The Budget Papers can be found HERE