At a glance: 
  • $1.5 billion Workforce Compact money re-directed back into the general pool of aged care funding  
  • Residential and home care providers to receive an increase of 2.4 per cent in their basic subsidy
  • A 20 per cent increase to the Viability Supplement to benefit rural and remote providers
  • Reduction in the annual growth rate in funding of the Commonwealth Home Support Program from 2018-19 from 6 per cent to 3.5 per cent
  • The Payroll Tax Supplement paid to for-profit aged care providers will be discontinued

By Darragh O’Keeffe and Natasha Egan

In a hotly anticipated move the Federal Government has redirected the $1.5 billion from the previous government’s Workforce Compact back into the general aged care funding pool, which will see an increase of 2.4 per cent in the basic subsidy for both residential and community care providers.

However the government is also saving $1.7 billion over the next 10 years by reducing the annual growth rate in funding for the Home Support Program from 2018-19, from 6 per cent to 3.5 per cent.

In its Federal Budget 2014-15, handed down yesterday evening, the government said that the $1.5 billion Workforce Compact money would fund a 2.4 per cent increase in the basic subsidy from 1 July 2014 for residential and home care providers, as well as Commonwealth Home and Community Care programs.

The money will also fund a $54 million boost to rural and remote providers over four years through a 20 per cent increase in the Viability Supplement.

The government will provide one-off funding of $800,000 to those aged care providers that had signed up to the Workforce Compact.

Acknowledging the problems with the current ACAR system and over-subscription by providers in previous years, the government is bringing forward the timetable for the increased allocation of Home Care Packages.

Implementing a proposal from the Commission of Audit, the government announced it would cease Payroll Tax Supplement payments, which is mainly paid to for-profit providers, from 1 January 2015, to save $652 million over four years.

The government said it would achieve savings of $7.7 million by not proceeding with further grants rounds in 2013-14 under the National Respite for Carers Program, with $965 million over four years remaining in the program.

The Federal Government has also scrapped the Andrew Fisher Applied Policy Institute for Ageing, which was announced in the last Budget, to save $5.9 million over five years.

The Housing Help for Seniors pilot, another initiative that was announced in the last Budget, has also been scrapped, at a saving of $173 million over five years. It was due to commence on 1 July.

The Budget provided $20 million for CALD services in Western Sydney, with $10 million over three years for the Lebanese Muslim Association to build a residential facility and $10 million over two years for aged care services to the Maronite and other Arabic speaking Christian communities of Western Sydney.

The Budget also detailed the establishment of a Disability and Carers Industry Advisory Council, provided with $900,000 over four years, to provide advice and recommendations to government.

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