Ageing Australia has welcomed the Aged Care Quality and Safety Commission (ACQSC)'s review of proposed Liquidity Standards due to come in with the aged care reforms in November, saying the original proposal could have threatened investment in the ageing sector.

In May, we reported the peak body had written to members to inform them they would be able to comply with new liquidity standards by demonstrating to the ACQSC they had robust liquidity management processes in place.

That options remains in ACQSC's report, released last week, on consultations on the proposed Financial and Prudential Standards.

Ageing Australia’s General Manager of Policy and Advocacy Roald Versteeg (pictured above) said, “If we’re going to have minimum liquidity standards, as the Royal Commission recommended, we want to make sure they don’t undermine investment.

“We advocated for a clearer alternative method for providers to demonstrate compliance against the Standard, to avoid situations where hundreds of millions of dollars – intended to build more beds – is tied up.

"It’s great to see that the Commission has responded to these concerns and has clarified this alternative method."

In addition, liquidity ratios for residential aged care providers look set to remain at 35% of cash expenses plus 10% of refundable deposit liabilities, as per the original proposal.