Yesterday was Day One of seven days on the most important area of enquiry for the Royal Commission into aged care quality and safety – the funding of the sector.
We will touch on it in this issue of The SOURCE but next Thursday, in our first full aged care edition of The Thursday SOURCE, our editor Lauren Broomham will provide a detailed overview of the funding hearings.
Briefly, in yesterday’s hearing the two standout witnesses were Paul Keating and Grant Corderoy.
Mr Keating, the Ex Treasurer and Prime Minister who introduced superannuation, for the first time moved away from his idea of a longevity levy to fund a national insurance scheme for the last two years of our lives.
He now champions a HECS style ‘use now/pay later’ system to fund home and aged care.
He said introducing a levy on wages to pay for aged care now would be “politically difficult”, especially given the Government’s current opposition to further increasing the superannuation rate.
A Medicare-style levy would also be challenging because of the long lead time in setting up such a system when people need services now, citing the 100,000-strong waiting list for home care.
Under the HECS system, older people are advanced loans to pay for their aged care accommodation which would then be credited back from the person’s estate after their death.
“We’re not forcing anyone out of their home in old age, we’re not obliging aged persons to negatively mortgage their home, you’re not asking members of families to chip in and pay for their relatives in their accommodation or their care,” he summed up.
“I think such a system has a lot of advantages, the main one is that you don't have that fiscal bar on the adequacy of funding that’s necessary that we do see now with the big waiting lists on home support – Home Care Packages.”
