Aged care providers have been caught between a rock and a hard place in adapting to new changes
brought about by the implementation of the Carbon Tax, according to Aged and Community Services
Tasmania (ACST) Chief Executive Officer Darren Mathewson.

Under the changes, around $3.50 of the $6.50 increase to the pension will be paid to residential aged
care providers to cover daily living costs.

Mr Mathewson said while the increase was not ideal, it was a measure to ensure services to people in
aged care remained strong as service providers had received no direct compensation for the carbon
tax.

“Ideally, there would be no increase in costs, however this is a Federal Government initiative and aged
care providers have had no input into the decision,” Mr Mathewson said.

Aged care providers will now receive 85 per cent of residents’ pensions to cover daily living costs,
however, Mr Mathewson said this 1 per cent increase would bring the figure back to what it was prior to
the significant increase to the aged pension in 2009.

“Before the pension increase, aged care providers received 85 per cent of pensions, which was
reduced to 84 per cent to help ease the burden on aged care recipients,” Mr Mathewson said.

“The initial increase in the aged pension was to reflect the rising cost of living for people receiving this
payment.

“Naturally, the costs of living for those in residential aged care will be incurred by providers.

“Therefore, this increase will go some way to easing the burden of rising costs faced by residential aged
care facilities, however across the board our services continue to struggle with costs outstripping
funding increases.”

Mr Mathewson said that while the Federal Government’s aged care reforms announced earlier this year
were promising in terms of the expansion of home care and future investment in the workforce, the
immediate reality was very different.

“Residential care providers have suffered a setback as a result of the Federal Government’s decision to
offer no indexation this financial year and to cap future subsidy growth to protect their budget position,”
Mr Mathewson said.

“The aged care sector continues to ask for an independent cost of care study to ensure the delivery of
care services in the future are not totally at the whim of Governments and their budget strategies.

“Many of the positive changes outlined in the reform package will be rolled out gradually over the next
5-10 years, which is a step in the right direction but does little in the immediate future for providers
having to deal with the increasing costs of care.”
Darren Mathewson CEO Aged and Community Services Tasmania