The Treasurer Dr Jim Chalmers and Aged Care Minister Anika Wells have released figures showing the aged care budget is on track to blow out by $5 billion this year.
The cost of delivering aged care is forecast to rise 23% this year, rising from $24.8 billion to $29.6 billion. The aged care worker pay rise will add another $1.9 billion to the bill.
The surge is being driven by the ageing population – there was a 3.5% increase in the number of Australians receiving aged care services in the last two years, to about 1.5 million.
By 2025-26, the cost of aged care is expected to have reached $35.8 billion annually.
The Treasurer and Aged Care Minister said the sector was “egregiously underfunded” by the previous government.
“The Liberals and the Nationals cruelly underfunded our aged care sector – this hurt Australian seniors the most, but it’s also put incredible pressure on the budget,” Chalmers said.
“We owe it to our senior citizens to deliver adequate funding for aged care in this country. It’s what Australians expect and what our seniors deserve.”
The Aged Care Minister said the decision to increase funding to aged care is needed to “restore dignity” to the sector after years of inadequate funding.
The government’s initial response to the Royal Commission was a $17.7 billion boost to the aged care budget over four years.
