Aged care grants welcomed – but “clearly not the full solution”
The Federal Government has announced $115 million in new capital grants aimed at boosting aged care bed supply in areas facing the most acute shortages.
The funding will be delivered through the Aged Care Capital Assistance Program (ACCAP), with Adelaide and the Illawarra targeted in the first round of projects, followed by Perth and the Hunter in a second tranche.
Providers will be invited to submit proposals through an Expression of Interest process to build and open additional beds within two years, with the aim of easing hospital discharge pressures and improving access to residential aged care.
Federal Minister for Health, Disability and Ageing Mark Butler said the funding forms part of the Government’s wider effort to increase aged care capacity as Australia’s population continues to age.
“We know we face a big challenge in increasing bed capacity across our health and aged care systems to meet growing demand,” he told an Adelaide press conference to announce the measure today (Friday 6 March).
“This latest round of funding will increase supply in areas that need it most, like Adelaide.”
The announcement brings total Commonwealth investment through the ACCAP program to more than $1 billion since 2022, with further funding rounds expected later this year.
Targeting the pressure points
The grants are designed to unlock projects that can deliver new beds quickly, particularly in regions where hospitals are struggling to discharge older patients who are waiting for residential care.
More than 3,000 older Australians are currently stuck in hospital beds nationally, medically ready for discharge but unable to access aged care or home care services.
Ageing Australia CEO Tom Symondson has welcomed the latest funding round, saying targeted capital programs can help accelerate supply in the short term.
“We welcome any commitment that can help us build more beds quickly or bring beds back online,” he said.
But he cautioned that the scale of the challenge facing the sector is still far larger.
“This announcement helps, but it is clearly not the full solution,” Tom said.
“Not only do we need thousands more beds than this fund will deliver, [but] several regions with enormous demand will miss out this time round, including Brisbane.”
The widening capacity gap
Australia added only around 800 residential aged care beds last year, while Department estimates suggest the country needs roughly 10,000 new beds annually over the next two decades to keep pace with the growing older population.
The widening gap between demand and supply is already flowing through the health system, with hospital discharge delays forcing State Governments to also step in.
Western Australia has recently launched a $100 million low-interest loan scheme while South Australia is proposing a $250 million no-interest program to stimulate new aged care beds.
“Within the next few years, we will find ourselves in a situation where we literally cannot meet demand,” Tom warned.
“Initiatives that aim to bring beds online in the short term will be critical to tackling this issue.”
Under the ACCAP process, providers will have six weeks to submit proposals, with projects expected to prioritise designs aligned with the National Aged Care Design Principles.
For the sector, the latest grants represent a welcome injection of capital – but the broader challenge remains the same: building enough aged care beds, fast enough, to keep pace with demand.
