The aged care sector is undergoing major regulatory and market changes, which will have significant impacts on the economy as a whole as the sector employs a growing workforce.

As more people are using aged care, and the demand is forecasted to increase in the future, the decrease in government funding will be detrimental to the sector as a whole. It is expected that aged care services and facilities will need “to do more with less” in regards to funding.  

Funding has always been a concern of those involved in aged care. In the past few years the aged care sector has been hit with several funding cuts, including last year where aged care funding in the 2016 Budget was reduced by $1.2 billion.

These reductions in funding have affected the aged care sector in drastic ways.  Announced in May last year, the cuts for the Aged Care Funding Instrument (ACFI) is to be spread over the next four years.

And before that there was the freezing of indexation in 2012 and the removal of the Payroll Tax supplement in the 2014 Budget.

As less government funding goes into aged care, it is expected that more spending with come from the clients and consumers of aged care for those that can afford it. With greater consumer choice, it would lead to greater expectations on the service providers, which would make the aged care sector more competitive and drive quality improvements.

The government have sought to slow the growth of spending in the public sector, and it’s been the health sector and aged care in particular that have received most of the damage.  

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The Aged Care Guild have reached out to the Federal Government for a guarantee that there will be no reductions to aged care funding in this year’s Budget.

Led by the CEO of the Aged Care Guild, Cameron O’Reilly said, “The Aged Care Guild calls on the Turnbull Government to rule out further cuts and to maintain funding for aged care in this year’s Federal Budget to be handed down on May 9”.

“Our sector has endured a number of budget cuts in recent years, and we are now at a point where any further reduction in funding will severely compromise the ability of the sector to offer affordable care and meet future demand for care places,” Mr O’Reilly said.

To show support for the aged care sector, Aged Care Guild have launched a ‘Protect Aussie Aged Care’ campaign which highlights the voices of aged care residents and employees – essentially people on the “frontline” of care delivery who understand the impact further funding cuts would have.

Some aged care providers have backed the ‘Protect Aussie Aged Care’ campaign, urging their consumer to sign the new petition against funding cuts.

With the ageing population looked to increase over the next few year, Mr O’Reilly predicts that there need to be 76,000 new beds by 2026 – and with the current state of funding, these needs may not be met.

“Further cuts would make a difficult situation much worse. The sector needs funding stability to ensure it can continue to provide the services elderly Australians need,” Mr O’Reilly explained.

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