$3b aged care investment prompts sector to call for workforce‑led reform

In response to Labor’s $3 billion aged care investment, industry leaders are urging the government to ensure that workforce planning, staffing protections and clinical capability remain at the heart of any reform.

A central feature of the package is the construction of 5,000 new residential aged‑care beds each year (supported by new targeted capital subsidies), an increase to the Accommodation Supplement, and structural changes that introduce new funding tiers, such as additional payments for facilities with more than 60 per cent supported residents.

The upcoming May Budget will also include more than $200 million for 20 new Specialist Dementia Care Program units and an expansion of the Hospital to Aged Care Dementia Support Program.

The Health Services Union (HSU) said the investment represents a significant step forward for older Australians and the workforce that supports them.

“This is a substantial investment in a sector that has been under enormous pressure, and we commend the government for acting,” HSU national secretary Lloyd Williams said.

“Older Australians deserve equitable access to quality care and the workers who deliver that care deserve to be properly supported, planned for and protected.”

While acknowledging the urgent need for more residential beds, the HSU stressed that expansion must be matched with careful workforce planning.

Mr Williams said unions must be involved at every stage of reform rollout and warned that additional payments to providers should have strict governance to ensure they reach frontline services.

“Workers cannot be short‑changed to pad provider profits,” he said.

The Australian College of Nursing (ACN) also responded with caution, warning that the expansion of residential care capacity must be accompanied by a clear plan to grow and support the nursing workforce.

“Each of those [5,000] beds requires nurses. We must invest strongly in workforce planning and skilling up our nursing workforce to deliver the standard of care older Australians deserve,” ACN chief Professor Kathryn Zeitz said.

The College is calling for greater investment in scholarships for enrolled and registered nurses to complete specialised aged‑care training to fill workforce skills gaps. It is also said a dedicated funding stream is needed to scale up nurse practitioner‑led models in both home and residential care. Changes are also required to RN care‑minute requirements to allow enrolled nurses to deliver 20 minutes of appropriate delegated care per person per day.

Public investment, the ACN said, should be directed “where it achieves the greatest impact – and that is in frontline services delivered by qualified professionals.”

Ageing Australia chief Tom Symondson said the new capital subsidies and funding changes are overdue and will help providers respond to escalating demand.

“We welcome any investment in aged care that can provide more beds at a difficult time for the Australian economy,” he said.

“Beds do not build themselves, so we’re pleased the government has heeded these warnings and pushed some of the outcomes of the accommodation review forward.”

However, Mr Symondson said that the scale of investment remains well below what is needed.

He said the sector needs to build 10,000 additional beds every year for the next two decades, with only 800 built last year, and also noted that the $5 increase for existing beds is less than half the $13 gap between current funding and the cost of providing accommodation.

With residential aged care operating at around 94 per cent capacity nationally, and at full capacity in many capital cities, he said more providers are “putting up the no vacancies sign every day.”

As the Budget approaches, industry leaders are seeking clarity on how the reforms will be implemented, how workforce needs will be addressed and how funding changes will translate into sustainable service delivery.

With demand rising across residential, home‑care and dementia services, advocates say the effectiveness of the package will depend on whether the system can expand capacity without placing additional strain on the workforce.