Australia: Caring for older Australians - final report released by the Productivity Commission

On 8 August 2011, the Federal Government released the Productivity Commission's final report on its investigation into the aged care system titled, 'Caring for Older Australians'.

The final report extends over 1000 pages and contains 58 recommendations which will affect consumers, residents, providers, developers and financiers.

While many of the recommendations reflect the principles and concepts contained in the draft report, the final report provides greater detail and clarity to a number of initiatives.  Many of those recommendations have been the subject of extensive media attention, which has been focusing on the impact on consumers and the family home.

Though such matters are important, a closer reading of the report reveals a number of other initiatives and recommendations which will impact providers including the provision of greater flexibility for operations coupled with greater scrutiny and increased penalties. 

A notable and more prominent item in the report is the recommendation for the introduction of a Government backed 'Australian Care Home Credit' scheme, which would operate similarly to a reverse mortgage product.  Given the announcement by the Honourable Bill Shorten MP, also on 8 August 2011, in relation to consumer protection laws for reverse mortgage products, the timing is interesting.

The final report comes at a time when the prudential obligations on providers in respect of the use accommodation bonds are also changing, with those amendments coming into force in October 2011.  How the report sits with those changes and what role community care packages will play in the future gives rise to both opportunity and risks to aged care providers and other providers of forms of seniors' accommodation including retirement villages. 

Gadens Lawyers will be hosting a panel discussion on 30 August 2011 to discuss the report and its implications.  We will be joined by fellow industry experts from Deloitte, ANZ, Westpac and NAB to consider the effects of the Report. 

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This report does not comprise legal advice and neither Gadens Lawyers nor the authors accept any responsibility for it.