Ursula Stephens (NSW, Australian Labor Party, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion) Share this | Link to this | Hansard source

I am very pleased today to address the Aged Care Amendment (2008 Measures No. 1) Bill 2008. This bill implements the changes to the Aged Care Act 1997 accommodation subsidies and resident accommodation fees that were announced in the 2007 federal budget. The bill amends the Aged Care Act to simplify the fees and charges paid by residents, as well as the accommodation supplements paid by the government for residents who cannot fully meet their own accommodation costs. A higher level of accommodation payments will be phased in to support the provision of quality accommodation. All care recipients, regardless of whether they are pensioners or self-funded retirees, will potentially be eligible for the new government accommodation supplement. The eligibility of the care recipient for the accommodation supplement will depend on the person’s assets. Unlike under the current arrangements, new self-funded retiree residents with few assets will also be eligible for government assistance.

The bill also amends provisions governing income tested fees. Currently, self-funded retirees pay higher income tested fees because nearly all of their income is counted under the income test. However, pension income is currently not counted under the income test. This results in self-funded retirees paying more than part-pensioners of similar means. The bill creates a new income test that treats all people in the same way and treats all income the same.

There are three important safeguards that will ensure that residents are protected and that the changes do not adversely affect existing residents: first, a residence accommodation charge will continue to be determined based on assessable assets at the time of entry to care and remain fixed until they are discharged; second, the government will continue to place a cap on accommodation charges; third, residents with unrealisable assets will continue to be able to apply for hardship assistance if they cannot afford to pay their charges.

The changes also broaden eligibility for community care grants for providers of community aged-care packages and extend eligibility to extended aged-care at-home providers, extend the operation of aged-care legislation to the territory of Christmas Island and the territory of Cocos (Keeling) Islands and makes technical amendments to improve consistency and clarity in the Aged Care Act. Subject to the passage of the bill through parliament, it is proposed that the new arrangements will take effect from 20 March 2008.

In addition to the amendments required to the act, further detail will be outlined in amendments to the aged-care principles as well as in other delegated legislation. These changes align with the implementation of the Aged Care Funding Instrument, which determines the level of funding for care based on the assessed needs of care recipients. As we have previously indicated, the government is committed to review the implementation of the Aged Care Funding Instrument, including the extent to which it achieves its stated purpose, 18 months after implementation. We have also committed to review the current aged-care planning ratios to take better account of demographic changes and changing patterns of use of aged-care services. I commend the bill to the Senate.

Question agreed to.

Bill read a second time.