This paper sets out the Business Council of Australia response to the Productivity Commission’s Final Inquiry Report on aged care services, Caring for Older Australians.

The Productivity Commission has recommended a fundamental shift in how aged care services are provided: from a system of government-funded services in which choices of care and services are limited, to one in which older people are entitled to subsidies that can be applied to the services of their choice in the setting they choose.

We strongly endorse the need for change and the Productivity Commission’s recommendations, and call upon both government and Opposition parties to commit to a long-term plan for fundamental reform.

We also identify what we see as the key risks to reform implementation and make recommendations about how these might be managed.

These are:

• Ensuring that consumers are empowered to make informed choices about what services they access and where, including through greater competition between providers on the basis of best-outcome service delivery.
• The health and aged care systems must be properly integrated so services can be delivered in the most appropriate clinical settings.
• Regulation and financial incentives must be overhauled to better attract investment and foster innovation and competition in the sector.
• Regulatory barriers to career advancement and to attracting sufficient numbers of skilled staff must be removed.
• Articulating a clear implementation plan, and improved and consistent methods of reporting and monitoring sector performance must be adopted.

Preparing for a Better Future: Creating a Sustainable System of Aged Care Services for Australia has been prepared with assistance from Gillian McFee of Gillian McFee & Associates.

Preparing for a Better Future: Creating a Sustainable System of Aged Care Services for Australia