The Government and the Opposition are debating whether or not the budget contained ‘new’ money for aged care, or if funds have simply been redirected from residential care to more popular home care.

The Labor party has criticised the Government’s $5 billion aged care package for simply reallocating funds from residential care to more popular home care. It says $1.6 billion that had been allocated to nursing homes has simply been redirected to fund 14,000 home care packages.

The Australian has reported that the Coalition said funding tied to residential care places that didn’t become operational has been directed to home care.

The Australian Financial Review has stated that the aged care industry isn’t concerned. The industry says funding for residential care that wasn’t spent was returned to consolidated revenue, and has been redirected to home care, where demand is strongest and waiting lists are long.

Residential care is more expensive than home care and has seen a drop in demand in recent years, while home care is cheaper to provide and is in strong demand, in part because it helps the elderly to stay in their home for longer.

Analysis in The Australian shows the Gillard Government also swapped funding from residential to home care in budgets between 2010 and 2012.

Health Minister Greg Hunt told The Australian, “Under the Coalition, every year home-care packages are up, residential aged-care places are up and aged-care funding is up.”


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