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The Albanese Government established a taskforce last year to find out how the country could properly fund aged care (Bigstock)

A taskforce reviewing funding arrangements for aged care has rejected the idea of a tax levy to cover the sector’s costs and instead suggested Australians accessing care should pay more based on their personal wealth. Source: ABC News.

The Albanese Government established a taskforce last year to find out how the country could properly fund aged care, following a range of recommendations made by a damning royal commission into the sector.

A total of $23.6 billion was spent on aged care in 2020-21, which increased to $24.8 billion in 2021-22 and $27.1 billion last financial year in 2022-23 with aged care expenditure expected to reach $42 billion by 2026-27.

The Government currently funds 75 per cent of residential aged care and 95 per cent of home care, a level that the taskforce’s report said “is not an optimal or fair mix”.

The taskforce found the following: 

  • demographic change means demand for aged care services will continue to grow
  • current and future generations of aged care participants have high expectations of what quality aged care looks like
  • additional funding is needed to meet future demand and deliver quality improvements, but structural issues mean the sector’s financial viability is poor
  • generally older people are wealthier than previous generations and the taxpayer base is declining as a proportion of the population.

Despite suggestions from both aged care royal commissioners that the country should introduce an aged care levy of 1 per cent of a person’s taxable income, the report shied away from making the same recommendation. 

Catholic Health Australia last week urged the Government to expand user contributions for aged care to make the system fairer and sustainable.

“With most aged care services running at a loss and demand only increasing, we must ask those who can afford it to make a more substantial contribution to their care, while maintaining a safety net for those who need support,” CHA chief executive Jason Kara said.

The Government said it would consider all the taskforce report recommendations. 


Aged Care Taskforce rejects tax levy and proposes funding based on personal wealth (By Georgia Roberts, ABC News

Boost pay to fix workforce shortages in aged care (CHA)


Wealthy Boomers should use super for aged care: taskforce (Sydney Morning Herald

Albanese government rules out new aged care tax and levy, no changes to home means testing (