In a major funding intervention, the federal government has committed over $2 billion to enable Australia’s aged care sector to meet revised wage obligations resulting from the Fair Work Commission awarding a 5.75% pay bump to direct care staff.
The funding package provides vital budgetary support for aged care homes to fulfil backpay requirements dating from 1 July to 30 November, when wage increases took effect. The move comes as Minister for Aged Care Anika Wells reaffirmed the Labour government’s commitment to restoring value and stability to an aged care workforce still recovering from profound uncertainty.
“Yet again, the Albanese Government is proving our commitment to aged care, investing more than $2 billion so every aged care home will have the funding to make this wage increase a reality for a deserving care workforce – a workforce that has been undervalued for far too long,” Minister Wells stated. The package means providers will not bear sole budgetary responsibility for satisfying a wage correction long sought by care worker advocates.
The Aged and Community Care Providers Association emphasised that without funding assistance, providers already under extreme financial duress would likely lack the means to meet wage obligations amidst swelling cost burdens.
“Many providers would struggle to make ends meet,” said ACCPA CEO Tom Symondson. He commended the intervention for offering a lifeline to ensure continuity of operations.
Symondson explained that alongside parallel commitments granting care workers a landmark 15% direct wage increase from July this year, the move forms part of sweeping reforms to aged care envisioned to elevate pay and conditions to attract and retain skilled staff.
“Improving the pay and standing of our workforce will be a key driver of successful aged care reform,” Symondson noted. Government projections indicate the sector must rapidly expand by at least 110,000 direct care workers by 2030 just to keep pace with underlying demands.
The package also holds significance by establishing reliable mechanisms for annual aged care funding increases indexed to evolving wage conditions as part of multi-year budget planning. Minister Wells indicated providers can expect to receive updated AN-ACC pricing by August next year and will come into effect on 1 October.
For ACCPA, the introduction of consistent and sizeable funding cycle adjustments marks a pivotal reform to empower providers with greater certainty to remain operational in an extremely challenging economic environment.
Ritchelle is a Content Producer for Healthcare Channel, Australia’s premier resource of information for healthcare.
