By Keryn Curtis
The research and lobby group representing 100 of Australia’s largest and most powerful corporations has thrown its weight behind the campaign for urgent reform of Australia’s aged care system.
The Business Council of Australia (BCA) yesterday released its considered response to the Productivity Commission’s final inquiry report, Caring for Older Australians, saying the Australian Parliament must agree a long-term plan to reform the health and aged care system to address an unsustainable growth in demand and rising costs that it says will consume more than 40 per cent of most government budgets by 2050.
The report, Preparing for a Better Future: Creating a Sustainable System of Aged Care Services for Australia, strongly endorses the Productivity Commission’s wide-ranging recommendations as a ‘blueprint for change’ and calls for urgent bipartisan support to see the reforms implemented.
“Surely if there was ever an issue the parliament could find common ground on it would be making sure we provide the services that we will all need as we age and in a way that is going to be affordable for all governments long term,” said Business Council of Australia Chief Executive, Jennifer Westacott.
Above: Jennifer Westacott, Chief Executive, Business Council of Australia
“We strongly endorse the need for change and the Productivity Commission’s recommendations, and we urge the parliament to agree that only major long-term reform of the sector will address the challenges ahead,” Ms Westacott said.
She said business has a stake in this debate because a poorly managed approach to the ageing population will dramatically reduce the scope of governments to provide other essential services such as education and infrastructure.
“And the unsustainable growth in demand for aged care services within the current system of service delivery places a significant competing demand on an already tight labour market.”
Director of Policy at the Business Council of Australia, Ruth Dunkin, said that all smart businesses monitored demographic and market change and planned and adapted to ensure sustainability into the future.
“As the population characteristics change, our thinking about policy and program development needs to change, to ensure it reflects and matches those developments. It is true for all organisations and institutions and businesses in our economy. If you have a changing set of statistics in your market, it is pretty normal to be closely watching and considering how to develop your products and services and your workforce to better meet the needs and demands associated with that change.”
She said the BCA had become increasingly involved in the health reform debate and aware of issues around aged care and disability through its work around workplace relations and health policy.
“As part of its thinking about Australia’s future economic and social prosperity – which is what our vision and mission is all about – we have come to look in more detail over the last four years at what have previously been seen as our social systems. Health, aged care, and the disability system – and how they are looking in terms of sustainability in the context of an ageing population. And we’ve become increasingly concerned that they are not sustainable,” Ms Dunkin said.
The BCA used research undertaken with Deloitte Access Economics to get a picture of the combined finances of Commonwealth, state and territory budgets out to 2050.
Under their modeling, in addition to projected massive spending and deficit blow-outs, without fundamental reform, the healthcare and aged care systems will become unaffordable with increasingly difficult choices about how to ration services.
In addition, they see increasing constraints imposed on the ability of governments to support growth in the broader economy, and the ability of business to access the working population required to meet skills needs in other sectors.
The biggest risk
The BCA report acknowledges five risks that need to be carefully managed if the Productivity Commission’s vision for the sector is to be realised. They include ensuring proper integration of the health and aged care systems, ensuring consumers are empowered to make choices, removing regulation barriers and creating incentives, ensuring systems for reporting and performance monitoring and meeting workforce challenges.
But Jennifer Westacott said the main risk was that people do not recognise or accept the fundamental nature of change that will be needed in the next few years
“Only by agreeing and acting now will people and care providers have time to adjust. A decade of reports have so far only led to incremental change, but as our research shows, tinkering will not avoid the crisis that is looming within coming decades in our aged care system.”
“At a time when Australia must improve the productivity of the economy and better use its scarce resources, the performance of the aged care sector must be improved. Like healthcare and disability services reforms, this change is now urgent,” Ms Westacott said.
Aged Care Association Australia (ACAA) CEO, Rod Young has welcomed the Business Council of Australia (BCA) report, saying it was pleasing to see such an organisation supporting the aged care industry’s call for reform.
“It is pleasing to see an organisation such as the Business Council of Australia […] recognising the significant impact that failure to reform the existing scheme will have on future Commonwealth outlays and therefore the tax burden on businesses and individuals, if these reforms are not addressed.”
“It was also pleasing to see the acknowledgement by BCA of the need to include, within the reform, incentives for the deployment of technologies which will support care recipient independence and improve workforce capability,’ said Rod Young.
‘The BCA report recommending enhanced governance assistance for small service providers to achieve greater efficiencies and service outcomes whilst maintaining service flexibility and independence, is endorsed by the aged care industry,’ Mr Young said.
Dowload the full report from the BCA website here.