More funding for care for seniors at home. More user-pays for aged care for self-funded retirees and part-pensioners. Grandfathering of people currently within the system. Promises of funding for a struggling industry. Yesterday’s big announcement of bipartisan agreement on aged care funding is, in a way, nothing new. Twelve years ago, Julia Gillard and Mark Butler announced a major aged care reform package aimed at helping Australian seniors remain at home longer and ramping up the user-pays element of the overall system for retirees with greater financial means.
Indeed, the best way to understand yesterday’s announcement is as the culmination of a twelve-year reform process between two separate Labor governments, with the Coalition providing policy continuity in between and a royal commission to shame politicians into further action. Julia Gillard’s implementation of the Productivity Commission’s crucial 2011 report Caring For Older Australians established the broad direction of reform: creating a home care system that addressed the gap between the then-current systems of basic everyday assistance and more clinical in-home care, a greater role for means-tested user-pays, new institutions to improve quality and governance, and making the system more accessible and understandable, including via a single online gateway.
There was no overt bipartisanship in 2012 like there was yesterday, with Aged Care Minister Anika Wells actually thanking her Coalition counterpart Anne Ruston. But in 2012 Tony Abbott — AKA Dr No — declined to exploit the issue. He could have whipped up an almighty scare campaign about user-pays in aged care. Back then — like today — self-funded retirees (a natural Liberal constituency) were the main targets of the increases in charges. Abbott would have known that a scare campaign probably wouldn’t have attracted too many additional votes from Labor and cruelled the chances of reform in aged care that had to be delivered no matter who was in government.
Instead, the Coalition in government quietly continued Labor’s focus on improving the aged care workforce (let them import workers instead, seemed to be the Coalition’s approach) and focused on growing home care. The numbers tell the story. Gillard and Butler boasted about expanding home care from around 60,000 places to 100,000 by 2015, and 140,000 prospective places by 2022. By 2020, the Morrison government was proudly claiming it had added another 50,000 home care packages on its watch to bring the number of places to 196,000.
Albanese’s Labor commenced the process of transforming the entire home assistance policy into a unified Support at Home program that by 2027 will include both home care packages and the current Commonwealth Home Support Programme. With yet more billions of extra funding, by the 2030s 1.4 million Australians will be using home care.
The Morrison government pumped money into home care in desperation to distract from its shameful and horrific bungling of residential aged care during the pandemic and the horror stories emerging from the aged care royal commission, but in doing so it maintained the broad direction of policy since Gillard: keeping Australians out of residential care and at home longer (which means residential care increasingly becomes where one spends one’s final couple of months, if it can’t be avoided).
But Morrison took his cue from Abbott and ignored the workforce issues that had steadily worsened since the Howard years — even as the Fair Work Commission began the process of trying to estimate how much more aged care workers should be paid to obtain fair remuneration. It took Labor committing to fund the difference — a crucial step in ensuring that there was a workforce actually available to deliver the improved quality of care both sides said they wanted.
The broad directions of aged care policy for an ageing Australia are now set — keeping seniors at home as long as possible, improved quality of care in residential care from a better-paid workforce overseen by independent regulators, and more means-tested users-pays. As the government admitted yesterday, this will only reduce the rate of growth in aged care funding an average of 5.2% a year, rather than 5.7%, according to Treasurer Jim Chalmers — but that will translate into aged care spending, as a proportion of GDP, falling from 1.5% to 1.4% over a decade. Even decimal points count when you’re talking about those levels of funding.
It’s possible — perhaps likely — that future governments of both stripes will try to push user-pays further for self-funded retirees and part-pensioners. And the issue of quality of care will be in the lap of bodies like the Aged Care Quality and Safety Commission. But Labor has fundamentally re-engineered aged care, with help from the other side. Unusually, there’s credit to be had all round for good policy.
