As a demonstration of my government's continued strong commitment to fair and affordable access to high quality aged care, I am pleased to announce an additional $1.5 billion in funding for aged care services over the five years to 2010-11.
Our aged care system faces a number of long term challenges. The number of Australians aged 70 or over will double over the next 20 years. As the older population increases, Australia will need more aged care places.
At the same time, we know that older people prefer to stay in their own homes for as long as possible. The government has helped them to do this by substantially increasing community care. As a result, when older Australians do choose to enter an aged care home they tend to be frailer, and the type of care they need is often more complex and intensive. So care is costing more and will continue to do so.
The measures I am announcing will address these challenges. They will ensure that the increasing number of older Australians now and in the future will be able to access the right level of care, when they need it. It will also help Australia's aged care sector to meet those needs.
We are:
* Providing more and better community care, so more people can continue to live in their own homes;
* Increasing investment in high level residential care;
* Better matching funding to care, so that over time payments for those with the highest care needs will increase;
* Introducing a new fairer income tested care fee, which will no longer treat self-funded retirees on a different basis than pensioners with similar income;
* Providing more help for disadvantaged older people and people in remote areas, including Aboriginals and Torres Strait Islanders and homeless people
* Introducing other measures to improve the fairness of the aged care system.
These changes will make a fairer, simpler and better system, and will involve a large increase in Australian Government subsidies for aged care.
The package I am announcing today comprehensively addresses the remaining recommendations from Professor Warren Hogan's Review of Pricing Arrangements in Residential Aged Care. It is additional to the $2.2 billion aged care reform package Investing in Aged Care: More Places, Better Care that was announced in May 2004-the biggest investment in aged care ever undertaken by an Australian Government.
Including today's package, total Australian Government expenditure on ageing and aged care activities will have grown from some $3.1 billion in 1995-96 to an estimated $9.9 billion in 2010-11 - an increase of around 219 per cent.
These reforms will secure the future of the aged care system so that we can be confident that older Australians can continue to experience quality, choice and affordability in aged care.
More and better community care Most older Australians want to remain as long as possible in their own homes and communities. The government will provide more than $400 million over the five years to 2010-11 to help them achieve this goal.
There will be an additional 7,200 new community care places over four years. To help those who need increased support to stay in their own home, the new places will include an additional 1,600 Extended Aged Care at Home (EACH) packages