Fed Govt provides just $87 million to tackle aged care red tape in MYEFO

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It sounds good but it does little for the 197 aged care operators that LASA’s Sean Rooney keeps telling the Government are on the brink of collapse – or the aged care sector.

Treasurer Josh Frydenberg has announced just $87.3 million in ‘new’ funding in the Mid-Year Economic and Fiscal Outlook (MYEFO) to respond to the Royal Commission’s Interim Report – including $13.6 million to help its own Department meet the costs of the Royal Commission.

In total, the Government will provide $623.9 million over four years from 2019-20 – with most of the funding already announced in its 25 November 2019 announcement: 10,000 extra home care packages; measures to reduce chemical restraint and the number of younger people in residential care; and dementia training.

The extra $87.3 million funding will mostly go towards eliminating Government red tape, including:

  • $13.6 million over two years to support the Department of Health and the Aged Care Quality and Safety Commission to respond to requests from the Royal Commission;
  • $11.4 million to increase the capability of the Department of Health and the Aged Care Quality and Safety Commission to effectively monitor, identify and respond to failures in care and financial risks in aged care (a post-Earle Haven initiative?); and
  • $1.9 million to strengthen prudential and financial risk management of aged care providers (another response to Earle Haven?)

The cash is also being mainly drawn from the existing resources of the Department of Health – so it’s not ‘new’ funding either.

The industry peaks and major providers have warned smaller providers can no longer continue to carry deficits.

“The fact is that without more assistance in the short term, some residential providers will find it almost impossible to continue delivering quality care in their communities,” they said in a statement.

How many will be left with no other option but to cut staff in 2020?