Why UnitingCare has changed its tune on individual contributions to the cost of aged care

On January 21 The Productivity Commission released a draft report that outlined recommendations to reform the support and care for older Australians. The UnitingCare network, one of the largest providers of aged care and community services in Australia, welcomed this report.

We encouraged the Parliament to stand with older people and the services and staff that support them by agreeing on the necessary legislation and budget measures that will deliver the reforms needed to improve choice of, access to, and sustainability and fairness of aged care services.

There was almost universal applaud for the draft report. Predictably, the recommendations which generated the most concern relate to increasing the contribution of older people to the costs of care and accommodation provided in aged care facilities.

Some commentators have referred to the battles in the late 1990’s when many provider groups, consumers and other commentators argued against increasing contributions from older people to the costs of aged care.

There were strong voices against bond payments for high level residential care and the Government of the day did not adopt this policy. UnitingCare was one of those voices.

But things have changed a lot since then, and now UnitingCare Australia stands with other providers, with consumer organisations and with professionals and Unions to support individual contributions.

Australia’s economy and the financial status of Australia’s households have changed significantly in the last 15 years. Since 1996 we have gone part way to becoming the so-called “share-owning democracy” in which families who had previously never taken part in the stock market have grown their wealth through owning shares.

We have seen people who came from modest backgrounds being able to help their children into the housing market, or buy an investment property, as well as owning their own home. The sustained period of growth in the economy has created wealth for companies and generated high wages for the skills the mining, telecommunications and financial sectors need. Many Australians can live a life of comfort our grandparents would have considered extravagant.

We have seen demographic changes as well.

Many of the people who have increased their wealth and financial security over the past 15 years are Baby Boomers, the generation who will drive a quadrupling of demand for aged care in the coming decades. It is reasonable and fair to enable those people who are financially secure to contribute to the costs of the place they live when they need aged care, and the costs of the care they receive.

In fact, we could reasonably expect that the Baby Boomers who are financially secure are well able to cope with the cost of contributing to their accommodation and care. In general they are healthy, active and engaged. They plan to continue to participate and contribute in their communities for many years to come.

However, we know that with improvement in health care, this generation will live longer once the effects of ageing set in, and as they are less able to care for themselves. This will increase demand for both health and aged care services, and increase the length of time for which these services will be provided.

But not all Australians have shared in the growth in wealth and financial security. Not all businesses have been able to cope in the changing international and national market environments. Farmers and rural communities have struggled with changing trade and market conditions, not to mention the vagaries of the weather through the longest drought in a century and then the worst floods in decades.

People with skills no longer in demand, living in communities with few industries and limited job opportunities or with low skills and poor education have been unable to find a place in the labour market. Some families have seen three generations of unemployment.

People entering retirement age who have little or no savings and do not own their own home are entitled to expect their needs will be met as they age. It is reasonable and fair to ensure everyone, regardless of their financial position, can access high quality aged care services through adequate and sustainable funding from the public purse.

That is why UnitingCare Australia is arguing both for people who are able to contribute to the costs of their care to do so, and for a strong and sustainable safety net that will ensure that everyone gets the care and support they need as they age.

But funding reform is only defensible if consumers, carers and families can have more options and more choice in what services they receive, where they are provided (at home, in via community services or facility-based) and by whom. Improving the diversity and supply of services is an essential quid pro quo for expecting consumers and tax payers to make a greater financial contribution to the costs of their accommodation and care.

The Productivity Commission has made a number of recommendations about removing restrictions on supply and promoting more diversity and choice in services available. These recommendations need to be implemented in the right sequence and via a well managed transition plan that ensures ongoing and adequate supply of high quality services in every community across Australia, especially for disadvantaged and vulnerable consumers and communities who have less “market-power”.

Australia is at a cross roads. The Productivity Commission has brought together our collective knowledge and drafted 42 recommendations for game changing reform. Will aged care advocates and our elected representatives find a way past their competing priorities and interests and put the interests of older people and the needs of a changing nation first in their mind as they make legislative and budget decisions?

We in the UnitingCare network are doing all we can to support our services, the wider sector and the Parliament to step up to the challenge of an ageing population and make the big decisions now that will ensure all older people and their families can age in comfort with hope and dignity.