In A More Caring World

Costs are forecast to increase, so it pays to know your way around the numbers.

- Rodney Horin & John Rawling

Over the past year, the royal commission into aged care has conducted hearings in Adelaide, Sydney, Broome, Perth, Darwin, Cairns, Mildura and Brisbane. Commissioners Richard Tracey and Lynelle Briggs are required to provide an interim report by the end of October and a final report by April 30 next year.

One thing is almost certain: the cost of aged care will go up. The commissioners will likely highlight inadequate carer-to-resident ratios and underqualified staff in many places. The costs to rectify these will be considerable, as well as the inevitable increase in compliance costs. The federal government will not want to pay out much more to fund aged care, so most of these increases in costs will be passed on to consumers.

Aged care remains labour intensive, land is expensive to buy and buildings are expensive to build and maintain. The owners of such facilities expect to make a return on their investment. One other thing is certain: there will be no slowing down in the ageing of Australia’s population, so demand for aged care beds will outstrip supply and refundable accommodation deposits (RADs, formerly known as bonds) will increase.

As Australians live longer, more and more will end up in aged care. The number of people in permanent aged care is expected to nearly triple in the next 30 years, from 250,000 today to 700,000 in 2050. The industry is complicated and many decisions must be made, often involving large sums of money.

Here are the 10 most common questions that we hear at Joseph Palmer & Sons, and our answers.

Q. Will I need to sell the family home to pay the refundable accommodation deposit?