Speech by Senator the Hon Mitch Fifield

ACSA Conference

Location: Adelaide Convention Centre


Thank you for that introduction Peter.

I would like to start by acknowledging ACSA President Vaughan Harding and CEO Adjunct Professor John Kelly for their leadership of ACSA and for putting on such a great conference each year.

I would also like to acknowledge the Shadow Minister for Ageing, Shayne Neumann, and commend him for the vigour he has brought to his portfolio responsibilities.

I was very pleased that I could accept the invitation to speak at your “Coming of Age – Redefining Ageing” conference.

Ageing is indeed in the process of being redefined.

Redefining Ageing

In many ways it is being redefined simply because there are more older people.

I’m not going to rehash the demographics – you are all more than familiar with them.

But I will share with you some numbers that have surprised me as Minister with responsibility for ageing and aged care.

I was stunned to learn that there are currently 3,000 plus Centenarians in Australia. By 2050 there will be 50,000 Centenarians.

What a great national resource.

The other surprise was realising that only a relatively small number of people actually need to use aged care services.

Only 5 per cent of Australians aged sixty five years and over live in residential aged care. But from all the public discussion most would think it was ninety five per cent.

The statistics show that only twenty five per cent of people in the same age group access home support or care.

That still means though, that by 2050 an estimated 3.5 million older people a year will need some form of support from aged care services.

But the good news is that older Australians are living longer and healthier lives on their own terms.

People’s senior years are increasingly active – whether they elect to have that time in retirement or in a longer working life.

And along with the growing numbers, we are starting to see changes in the economic, social and cultural expectations of older Australians.

Mainstream culture – once the sole domain of the young – is beginning to reflect this reality.

We live in a time where ageing rockers are hailed and movies that focus on stories about older people are increasingly being released and attracting audiences.

This is happening because older people are a new and emerging market segment. They see themselves as a normal part of life and society. And the market is starting to respond.

This both demonstrates and makes clear that it will be older people themselves who redefine ageing and by extension aged care services.

As a Government and as service providers we also need to respond to the redefinition.

It is our job to ensure that when older Australians need aged care they get what they need and want – services that support the life they want to live.

Aged Care Changes

Now the changes being progressively implemented in aged care are designed to start to achieve that shift.

I thought it would be timely today to do a stocktake of the changes – those already implemented and those still in the works.

All of them recognise the simple fact that older Australians will be the driving force behind the design and delivery of aged care services.

They focus on giving people better information, more choice, more control and greater flexibility.

At the same time the changes are aimed at supporting service viability, reducing the compliance burden and increasing business flexibility.

Information – the game changer

Perhaps the most fundamental change has been the creation of the My Aged Care Gateway.

It means that older people, their families and carers will have more knowledge to make their choices and decisions.

An important feature of My Aged Care is that when you call you can talk to a real person.

It means you can ask your own specific questions and get a personalised response that helps you in the decision making process.

Initially most people want to know what help is available.

Quickly following that comes the inevitable question about the cost.

And the fee estimator gives people an idea of what they will have to pay for either residential or home care.

In the lead up to the 1 July 2014 changes residential care providers were required to publish their accommodation prices on the My Aged Care website and on their own sites.

People – both consumers and providers – are now able to compare pricing.

I wanted to make sure that people knew about the service. So I commissioned the ‘Let’s talk about changes to aged care’ campaign on 30 June this year.

Its important message is that people need to talk about and plan for their aged care. And that the sooner people do that the better the outcomes for older people, their families and carers.

Aged care has traditionally been seen as health care; now it is as much a financial, economic and social issue.

The campaign has been quite effective prompting a 40 per cent increase in calls to the national contact centre and a 134 per cent increase in the number of people visiting the website.

In other words around 300,000 people accessed My Aged Care in July alone to find out about aged care.

I am looking at the ongoing level of promotion required to make sure that people know about My Aged Care as and when they need to.

Ongoing promotion is important so that people can access the information already there as well as a series of new features which are being progressively added:

  • Screening and eligibility assessment will commence at My Aged Care on 1 July next year.
  • A client record will be developed so that older people don’t have to continually repeat their story to different service providers and professionals involved in their support.
  • A linking service to help vulnerable people access both My Aged Care and aged care services will also come on stream.

All of these features will support older people, their families and carers to have that conversation – to plan and then make their own decisions and choices.

People want to stay at home

And the choice many older people make is to live in their own home and community as independently as possible for as long as they can.

Sometimes all people need is basic maintenance, care, support and respite services to help them achieve that.

On 1 July 2015 the Commonwealth Home Support Programme will come into being.

This programme will consolidate four existing basic care and support programmes -Home & Community Care, National Respite for Carers, Day Therapy Centres and the Assistance for Care and Housing for the Aged programme – into one. This is a significant streamlining which should benefit providers and consumers.

I hope you have taken the opportunity to contribute your thoughts on the discussion paper about the design of the new programme.

It will be important to get the design right given the importance of basic supports in helping people to stay at home.

Choice and control

When more than the basics are needed, home care packages are there to give a higher level of support.

And it is in packaged care that another fundamental change is underway.

We have now had two aged care approval rounds offering 12,488 consumer directed care packages. We are now just nine and a half months away from all packages being offered on a consumer directed basis – from 1 July 2015.

I don’t underestimate the challenge offering consumer directed packages throws at service providers.

That’s why there has been a three year lead time.

That’s why government has funded the Transitional Business Advisory Service as well as funding for two capacity building projects – one to support consumers and one to support providers – specifically focussing on consumer directed care.

It has been great to see ACSA work with both COTA and LASA to develop tools and resources for service providers to help with that transition. All of this work will be housed on the Home Care Today website which I will have the honour of launching later today.

I believe you may have had a sneak peak of Home Care Today over the last couple of days. I’m sure it will prove to be a valuable resource as you move to operating in a consumer directed environment.

Residential Care

For those unable to remain living in their own home there is always residential care.

The changes made to date aim to provide more choice, transparency and flexibility for consumers while creating financially viable residential care services.

There is no longer a distinction between low and high care.

New accommodation payment arrangements have commenced.

For residents that can’t afford to pay for their accommodation’ government is paying a significantly higher accommodation supplement – perhaps more commonly known as the significant refurbishment supplement.

This is an important measure designed to stimulate investment and building in the sector – important to meet the ongoing demand for residential care services.

Residents who can afford to pay for their own accommodation will do so.

Consumers have twenty eight days to choose how they will pay – by a lump sum (RAD) or periodic payment (DAP) or a combination of the two.

This was, I know, a cause of concern for some providers in the lead up to 1 July this year.

I have given a commitment to closely monitor the real world impact of these changes and will do so – particularly through the work of the Aged Care Financing Authority – which will provide me with monthly reports.

Three months in it is probably a little too early to tell or discern any significant trends, but from discussions with providers it seems that for many it is business as usual.


None of these services can be provided without staff.

When this Government took office last year it acted on its election commitment to repurpose the workforce supplement.

The supplement was poorly designed and did not give providers any flexibility in the way they were able to address their specific workforce issues.

The repurposing has delivered a 2.4% increase in subsidies to aged care providers.

We took the opportunity to also add the Conditional Adjustment Payment back into the funding base. The 2.4 per cent was then applied to that new and larger base.

In recognition of the additional challenges faced by rural and remote aged care services the repurposing included a 20% increase to the viability supplement.

Government is well aware of the workforce challenge we face.

As part of the repurposing, a stocktake of the various workforce initiatives will be undertaken to ensure we are getting the maximum value from our investments and that they are having a positive impact on meeting the workforce challenge.

Other workforce initiatives are also underway to support aged care providers get the staff they need. No doubt you are all aware of the three-year labour agreement recently announced by Fronditha.

The Agreement allows Fronditha to recruit Greek-speaking care workers under the same wages and conditions as local employees.

This is the first such labour agreement struck. And, any aged care provider can submit an application for a labour agreement.

We are determined to uphold the integrity of Australia’s skilled migration program, but we are equally committed to a policy of facilitation rather than frustration, when it comes to employers accessing the skilled workforce they require, when this need is demonstrated.


Workforce and quality are inextricably linked.

In aged care this is especially so given the very personal nature of the support provided.

Quality indicators are being developed and trialled in residential care.

They focus on important clinical care issues of unintended weight loss, pressure sores and physical restraint.

They are important but will only tell some of the quality story.

I agree with industry advice I received that it is the consumer experience that ultimately defines quality.

The consumer experience of a service is tied strongly to their interaction with staff – the relationship they have with them, their skills and attitudes.

The project to develop the quality indicators will include work on understanding and finding out about the consumer experience of residential care.

The Quality Agency is up and running and Government is in the process of appointing the Advisory Council.

In doing so I am mindful of the importance of the quality and safety of all of the care and services provided but also of the consumer experience.

Transition issues and difficult decisions

I don’t want you to leave today thinking that I believe it has all been smooth sailing.

I am very aware of the current problems occurring in the means testing being undertaken by Centrelink with delays of weeks until people have received a letter outlining what they have to pay.

My colleague Minister Marise Payne is also aware of the issues and our respective Departments are working to understand the depth and breadth of the issue and resolve the problems as quickly as possible.

I realise that there is a degree of fatigue, given the problems home care providers experienced with changes to the DHS system, which resulted in outstanding payments.

I understand that this situation has now improved but acknowledge that for some providers it is still being resolved.

I can only ask that you continue to work with my Department as they work to resolve your issues with DHS.

We were set to move to a new DHS payment system for residential care, but based on the home care experience we will not do so until it is clear that similar problems won’t occur again.

In talking about implementation issues it would be remiss of me not to talk about the difficult decision I had to make when faced with the blow out in the cost of the Dementia and Severe Behaviours Supplement.

I want to deal with this only briefly as I think most are aware of the issue and it’s really what comes next that is a more important focus.

The supplement was poorly designed and implemented. Designed by the previous government to support the care of 2,000 residents with severe behaviours at last count it was supporting 29,000 residents. The supplement cost $110 million over just 11 months – far exceeding its $11.7 million budget in the last financial year.

Had it continued, the payment would have cost $780 million over four years, rather than the $52 million budgeted, and over $1.5 billion over ten years.

This meant that the only responsible decision I could make was to cease its payment.

It’s fair to say the Dementia and Severe Behaviours Supplement was no model for partnership – from design, through inception and implementation to cessation.

But sometimes changes have to be made and I won’t hold back from making them. But it is my intention to not have to do this.

For there to be long term confidence in the sector there has to be long term sustainability. I won’t shy away from this.

This means that initiatives have to be financially sustainable and can’t blow out in the way of the dementia and severe behaviours supplement.

Some of you have queried what this might mean for the higher accommodation supplement.

It means it has to be monitored and operate within its funding allocation. It is the only way it is sustainable and the only way to provide certainty.

Let the higher accommodation supplement serve as a model for partnership.

I have asked the Department and the Aged Care Sector Committee to monitor the supplement and work with me to ensure that it is successfully implemented and provides the stimulus required.

I want to work in partnership with the industry.

Another opportunity for this will begin on Thursday when the Ministerial Dementia Forum holds it first event.

Minister Dutton and I have asked the forum to consider strategies to improve the adoption of better practice dementia care and support in both residential care and support in the home.

We want to consider what it means for dementia to be ‘core business’ for all aged care services.

Whether it is for a person with mild dementia living in the community, or for those people who have more complex needs or who suffer from severe behavioural and psychological symptoms of dementia (BPSD).

From the advice provided by the Forum a replacement – for providers who support that small group of people with severe behaviours – will be developed within the existing funding envelope.

The Future

The dementia forum is one initiative looking to the future.

Last week I had a really good meeting with the Aged Care Sector Committee on which John Kelly represents ACSA.

We discussed its Statement of Principles which will set out broad directions for further changes to aged care and the way in which we should work together to achieve them.

The Sector Committee and the development of the Statement of Principles was an election commitment on which we are delivering.

The Statement of Principles requires sign off by the Prime Minister demonstrating the importance of aged care to the Australian Government.

Once this has occurred I look forward to engaging in a strategic conversation about the changes that will come next and move aged care further down the line of the vision espoused in the Productivity Commission’s seminal 2011 report “Caring for Older Australians”.

In the meantime, it is worth reflecting on the bright future the industry faces.

ACFAs 2012-13 Annual Report highlighted increased investment activity in residential aged care as a result of the changes to accommodation payments that came into effect on 1 July this year.

The 2013 Survey of Aged Care Homes estimates a total of $920 million of new building, refurbishment and upgrading work being completed in 2012 -13.

Taken together with other positive signs of investment activity from ABS data, and a number of significant investments in the sector in 2013 -14 it, would appear that investors have an overall positive view of the changes to date and interest in investments that leverage the ageing demographic.

The economic future of the industry will ultimately be defined by its ability to give consumers the services they want and need.

For it is consumer direction and choice that drives most service industries. It creates competition – which isn’t code for the lowest common denominator.

Competition drives innovation. It drives new service delivery. It drives new modes of thinking.

We will need to transition to a more competitive market. We are seeing the landscape change now with large for profit providers going to market making it easier for them to access needed capital. All organisations are going to need to think through the market shift and adapt.

Ultimately public and private dollars need to follow the person rather than the provider. This is what we are doing in the other part of my portfolio with the roll out of the NDIS. Aged care should be no different.

Dollars should follow needs. Care should follow choice.

The Coalitions 2013 election policy reinforced the need to continue the changes to aged care.

I look forward to working with all of you as we do just that.