Treasurer Jim Chalmers’ op-ed piece today challenging but hopeful for the aged care sector

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One week into the job and our new Treasurer has raised the flag that the country is in a “dire” position when it comes to cash.

It is an early warning that the aged care sector cannot expect significant new funding to alleviate underpayment for services and the 25% increase in wages to deliver parity for floor level staff.

We have reproduced the full 800 word op-ed in today’s issue of The Australian at bottom.

He makes three points:

  1. inflation is ‘skyrocketing’
  2. real wages are falling
  3. the budget ‘is heaving’ with more than $1 trillion in debt

On top of this, Mr Chalmers states the economy is not enjoying the growth the optimists project. He said:

“Quarterly gross domestic product growth of 0.8 per cent was much lower than what was forecast by Treasury in the Pre-election Economic and Fiscal Outlook, which was 1.8 per cent for the March quarter.”

Co-contribution funding

In our assessment, however, there is a ray of positivity for the aged care sector.

The Treasurer has placed great importance on having “a big national conversation” with all Australians about the economy and inherently, what society we want. He says:

“Anthony Albanese, his economic team, our new cabinet and government all want to engage Australians in a big national conversation about the economy and the opportunities ahead, and work together to address the challenges we’ve inherited.”

By our estimations, to deliver a 25% wage increase aimed at simply retaining the existing aged workforce, plus sufficient cash to make the business of aged care sustainable, will require between $7 billion and $9 billion now, and then CPI indexed with inflation and growing with the increasing aged population.

The only realistic path is Plan B, co-contribution for home and residential care.

It is up to the sector to facilitate a community conversation on the funding required to deliver quality care and what is fair in who pays; should it be the taxpaying 18-to-60-year-olds, or the actual recipients of the care services?

Now is the time for the sector to be proactive in generating this conversation, to make it easier for the government to then review options.

With a new aged care Minister who knows and understands the delivery of aged care plus a Health Minister in Mark Butler who also has a genuine interest and knowledge, now is the time to be constructively proactive.

Now is the time for Plan B.

Below is the full Op-Ed.

Full Op-ED HERE.