Insights / May 12th, 2023

A substantial wage win for aged care workers

The recent release of the Australian Federal Budget (Budget) for the 2023-24 financial year has a broad range of implications for the aged care sector. A key outcome being that this Budget delivers the largest ever pay rise to aged care workers.

As the Australian population continues to age, the demand for aged care services is increasing dramatically, making it an obvious priority for government to provide necessary support and funding.

Cowell Clarke has a particular focus and expertise in the aged care sector, and as such we have kept a keen eye on the Budget developments.

Of immediate benefit are the increases to wages for aged care staff and the focus on home care packages. The Budget package includes the following key points:

1.     $11.3b to deliver 15% pay increases;

2.     $487m to extend Disability Support for Older Australians;

3.     $98.7m for provider viability support; and

4.     $12.9m to strengthen nutrition for aged care residents.

The Government has stated that it recognises the complex and previously undervalued work of the aged care workforce which is why it is investing to fund the Fair Work Commission’s interim decision for a 15% pay increase. As mentioned above, this is the largest ever pay increase for workers in this sector and it signifies real progress towards genuinely valuing their deduction and skill, and will help aged care providers attract and retain staff as stated here.

Further Budget items are likely to impact the aged care sector include:

1.     There is a proposed new regulatory framework for the Aged Care Act.  The sum of $81.9m is being budgeted to develop this new framework with the intention being to improve the quality and safety of aged care services and to restore trust and confidence in our aged care providers, staff and standards.

2.     Funding is to be provided to upgrade Star Ratings and uplift food standards. This will improve transparency at a cost of $139.9m over 4 years.

3.     A newly established single assessment system will use existing assessment organisation to simplify and improve access to aged care services. A new Aged Care Taskforce will be established to review aged care funding arrangements to ensure that the system is fair an equitable for all Australians.

4.     For those in rural and remote Australia, $98.7m has been allocated over 2 years to support the viability of local aged care providers ensuring that all Australians have access to appropriate and trusted care. A further $47.2m has been allocated over 4 years to strengthen access to care and support through services and the aged care workforce.  

The Budget has highlighted the federal government's commitment to improving the aged care sector. The above initiatives indicate a desire to meet the increasing demand for aged care services and provide better support for our ageing population.

In light of the above changes, Cowell Clarke’s dedicated aged care and retirement living team will continue to work closely with its residential aged care sector clients to ensure they achieve the best possible outcomes whilst ensuring compliance.

More information regarding the aged care Budget updates can be found here.

For further information please contact our Aged Care, Retirement Living and Health team.

This publication has been prepared for general guidance on matters of interest only and does not constitute professional legal advice.  You should not act upon the information contained in this publication without obtaining specific professional legal advice.  No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication and to the extent permitted by law, Cowell Clarke does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting or refraining to act in relation on the information contained in this publication or for any decision based on it.