With our Budget Day looming, New Zealand residential aged care and home support providers have been pleased to note that aged care has emerged one of the “winners” of Australia’s health budget.

What the Australian Budget delivered for aged care and home care

The Australian government announced A$1.6 billion over four years to allow 14,000 more older Australians to remain in their homes for longer through more high-level home care places.

For those in residential aged care, an additional A$82.5 million will be directed to improve mental health services in the facilities.

The Australian budget has also pegged A$253.8 million for a new Aged Care Quality and Safety Commission.

Writing for The Conversation, Helen Dickinson, Associate Professor, Public Service Research Group at UNSW says the budget announcement will go some way to restore the A$2 billion of cuts made to the aged care sector in recent years, “but do not significantly advance spending beyond previous levels in an area of the population we know is expanding substantially in volume and level of need and expectation”.

Dickinson says the A$1.6 billion for 14,000 new places for home-care recipients as welcome, but “a drop in the ocean, given there are currently more than 100,000 people on the national priority list for support”.

The Australian Nursing and Midwifery Federation (ANMF) also says the funding won’t fix the crisis in aged care and is disappointed that the Government has failed to address the urgent need for safe staffing in nursing homes. The union says from 2003 to 2016 there’s been a 13% reduction in qualified nursing staff working full-time in aged care while over the same period there’s been a 400% increase in preventable deaths in nursing homes.

Hopes for New Zealand Budget 2018

Here in New Zealand, the most prominent item on the Budget 2018 wish list for both aged care and home support providers is adequate funding for the second year of the pay equity settlement.

“We have no idea what is going to happen from the 1st July,” says Home and Community Health Association (HCHA) chief executive Julie Haggie.

In addition to the level of funding, Haggie says the funding mechanism has yet to be agreed – whether it is to be based on averages or actuals has huge implications for the sectors.

New Zealand Aged Care Association (NZACA) chief executive Simon Wallace says it needs to be properly funded to recognise the increased number of staff now on Level 4 rates largely due to qualification equivalency and the increase in the statutory minimum wage.

“We want to avoid the situation from last year when around 100 of our members were placed in a difficult financial situation as a result of the settlement. We acknowledge the transitional funding that was provided at the end of last year has helped many of those most impacted to remain sustainable, but this may not continue beyond 30 June 2018.”

Wallace says there also needs to be some acknowledgement of the pay relativity issues that now exist between nurses and caregivers in the sector.

Victoria Brown of Care Association New Zealand (CANZ) agrees that pay equity is a big issue.

“Pay equity is really harming the sector as there is not enough money being put into the pot. Many providers – even larger ones – are worried.”

In addition to pay equity, Brown says there is also pressure on small residential aged care providers to the extent that there may not be enough non-premium rooms available soon.

Brown says CANZ is also concerned about the increasing numbers of foreign buyers of aged care facilities.

Wallace would also like to see increasing cost pressures on providers acknowledged.

“We call this ‘compliance creep’ and it includes legislation such as the Food Act, the Health and Safety Act, fire regulations, increased water charges and immigration processing, all of which place an extra burden on our providers that have to be met within the confines of our current contract.”

Wallace is also calling changes to immigration policies to allow providers to retain their valuable migrant workers, and for some fairness regarding primary care costs for aged care providers, especially GP charges.

“Rest homes are contractually obliged to meet these costs on behalf of residents but because of the nature of arrangements, often pay more for services than a person in the community visiting a doctor’s surgery. This is inequitable – the now Associate Health Minister Jenny Salesa stood up at our Conference last year as a Labour spokesperson and clearly stated that rest home residents should pay no more than someone visiting a doctor.”

Returning to home support services, Julie Haggie says providers want to see guaranteed hours funded properly or else the sector will have no choice but to revert to how things operated previously.

“Providers have climbed a mountain in gym shoes since April last year so that their employees had more surety of their hours.

“An early draft of the independent report by Sapere showed the financial and resource exhaustion in the sector, and what could assist to support this marvelous work.  The Ministry of Health had the completed report six months ago, but it has not been released.

“If sufficient funding for does not follow then this will drive us back towards casualization of the workforce.”

Haggie is also hopeful of an uplift in funding in general terms. She points to the 2014 Director-General’s Reference Group report, which showed the home and community support services sector in financial crisis.

“Whilst funding has come in to uplift wages, the funding for providers remains woeful.   Meanwhile the government is spending substantial sums on an Aged Care residential sector pricing review.  Considering health strategies to keep people at home for longer, capacity funding for home support providers and NGOs would be an obvious step, as would the use of client case-mix to underpin funding decisions.”

So, plenty on the Budget wish list for the aged care and home support sectors – but nothing is new or unexpected or unwarranted.

There have been very few indications thus far about what Budget 2018 holds in store for these aspects of the health sector, so providers must wait it out until next week.


  1. Victoria Brown is right to be worried about pay equity but puts her fears as if PE was a bad thing. The lifting of carers pay – which lets remember the NZACA fought for five years through the Courts – now needs to be followed by the sector taking seriously the relativities for RNs , EN’s and housekeeping staff such as kitchen cleaning and laundry. Fuller funding will be one step forward but those businesses’ whose model of operation still depends on low pay for housekeeping and who contract out the likes of food services – only prolong the injustice; regardless of whether the owners are in based in Auckland or Melbournp


Please enter your comment!
Please enter your name here