Commission of Audit: what stakeholders said

Aged care providers, consumers and other stakeholders respond to the Commission of Audit’s recommendations related to ageing and aged care.


The Federal Government yesterday released the much-anticipated final report from the Commission of Audit. The commission proposed cuts to red tape and regulation governing finance, quality and quantity in aged care. It also proposed including the full value of the principal residence in the aged care means test. AAA has a full report on what the commission had to say related to aged care.

Here are some of the stakeholder reactions to the commission’s report:

Aged & Community Services Australia (ACSA):

ACSA CEO, Adjunct Professor John Kelly said reducing duplication in all aspects of financial reporting for the aged care sector and reducing other regulatory requirements for aged care providers was sensible public policy.

Professor Kelly said ACSA had offered 14 areas of red tape reduction in its submission to the Commission of Audit and was pleased the Commission had acknowledged potential savings to be made in this area.  “The Commission has also recommended using the full value of the principal residence in the current aged care means test and implementing arrangements to allow older Australians to access equity in their principal residence to pay for part of the cost of their aged care services. These moves would give older Australians who are asset rich and cash poor the ability to pay for the services they require,” he said.

Professor Kelly said that introducing a fee for providers to access the accommodation bond guarantee or the requirement for providers to take out appropriate insurance to cover the risk of default “would add to the cost of providing aged care services, as would the termination of the Payroll Tax Supplement.”

He said ACSA would analyse the implications of these moves with its members.

Leading Age Services Australia (LASA):

CEO of LASA Patrick Reid said the national peak body supported enabling older people to utilise equity in their home to contribute to aged care costs and backed the inclusion of the family home in the aged care means test. He said such a move would also eliminate the bias towards residents favouring Daily Accommodation Payments (DAP) over Refundable Accommodation Deposits (RAP).

While it welcomed efforts to reduce red tape, LASA said the removal of the payroll tax supplementation would represent an unfair “attack on the industry” and the ramifications of an alternative to the government’s bond guarantee scheme would need to be assessed.

Mr Reid also expressed frustration over the uncertainty and lengthy delay surrounding the redistribution of the $1.1 billion Aged Care Workforce Supplement money.

Council on the Ageing: 

Seniors lobby group Council on the Ageing (COTA) Australia said it was disappointed about the suggested changes to aged care. COTA CEO Ian Yates said that, while picking up the Productivity Commission’s 2011 recommendations on inclusion of the family home in the assets test for care, the commission ignored “the key PC trade-off for that – removing rationing of aged care and opening up aged care to market forces.”

“It’s mystifying that the commission wants to charge people more for aged care but not allow them access to it – seems they were very poorly advised or took their eyes off the ball on this issue,” Mr Yates said.

He welcomed the Prime Minister’s commitment to keep his election promise on the age pension and not change the pension in this term of government.

Catholic Health Australia: 

While it supported most of the elements of the commission’s recommendations on aged care, such as means testing and creating new ways to access equity in the home, Catholic Health Australia questioned the commission’s “decision to make the case for advance care directives.”

CHA said the commission’s terms of reference on “scope, efficiency and functions of government” made discussion on end-of-life care appear out of place.

CHA, which coincidentally released an Advance Care Plan framework yesterday in partnership with the Australian Catholic Bishops Conference, said that while thorough care planning at end of life was crucial, governments should not impose its views for economic reasons.

“In anticipating the commission’s report, we expected to see proposals to reduce government costs and reorganise government services. Including discussion about how people die in the context of recommendations on the ‘scope, efficiency and functions of government’ was not expected,” said CEO Martin Laverty.

“End-of-life decisions are deeply personal. They require sensitive and considered thought. The health and pastoral professionals who work in Catholic hospitals and aged care services support people on a daily basis in making advance care plans. We hope the Commission of Audit was not trying to cast end-of-life decisions as a requirement of economic efficiency.

“The commission specifically encouraged government to put in place mechanisms that would see more people aged over 18 adopt advance care directives. CHA does not promote use of directives, but does encourage use of advance care plans; there is a difference between the two,” he said.

National Seniors: 

The Commission of Audit’s targeting of the family home in pension and aged care means tests, and new or increased health co-payments was described as “extreme” by National Seniors.

National Seniors chief executive Michael O’Neill said the recommendations demonstrated just how far out of touch with ordinary Australians the commissioners are.

“The so-called ‘principal residence’ is routinely juicy, low hanging fruit in this sort of exercise. Economists underestimate the social, personal and cultural meaning of the family home, for not just seniors but their children and grandchildren too,” said Mr O’Neill.

“Put simply, Australians won’t accept it being used to pay off government debt,” he said.

Retirement Living Council: 

The Retirement Living Council said it opposed the recommendation by the Commission of Audit to scrap a pilot program aimed at senior Australians who wish to downsize, and urged the Federal Government not to proceed with it.

Mary Wood, executive director, said that dumping the new Housing Help for Seniors program would have the contrary effect to the commission’s goal of reducing public expenditure in the medium to long term.

She said two Productivity Commission reports recommended the government support schemes that allow wealth in family homes to be unlocked and enabled seniors to downsize as well as contribute more to age-related services, without being penalised.

“The Housing Help for Seniors program is the first step down this road – costing $112 million over two years… Governments should enable senior Australians to make housing choices that preserve independence and encourage ageing in place.”


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