$11.3 billion to fund aged care pay rise, wage theft concerns raised

The Australian Government has announced $11.3 billion funding to support the Fair Work Commission’s decision for a 15% increase to award wages.

The workers who will benefit from the wage increase are: registered nurses; enrolled nurses; assistants in nursing; personal care workers and home care workers; head chefs and cooks; recreational activities officers (lifestyle workers).

Aged care providers will receive additional funding through existing funding arrangements and new grant opportunities. Funding for on-costs and leave liabilities will be provided.

The award rate changes will take effect from the employee’s first full pay period that starts on or after 30 June 2023.

A welcome relief

The aged care industry body the Aged & Community Care Providers Association (ACCPA) welcomed the announcement.

ACCPA CEO Tom Symondson said, “This comes as a welcome relief for workers and aged care providers alike after a six-month campaign by ACCPA in seeking the government’s commitment to ensure the increase awarded by the Fair Work Commission last November is funded and paid in its entirety from July.

“It was not going to work for aged care providers and their staff to have the increase paid in two parts over 12 months — 10% this year and 5% next year — as originally intended by the government.

“The pandemic and reduced funding over the past decade have left the aged care sector struggling to attract new staff. Importantly, we also need to keep workers, who are exhausted after more than two years of supporting older people and keeping them safe from COVID-19.”

The Aged Care Workforce Industry Council (ACWIC) supported the announcement. “Filling aged care staff vacancies is the biggest challenge in aged care — not just nationally, but globally,” said ACWIC Deputy Chair Graeme Prior.

“Taking steps to ensure aged care workers are paid fairly for the vital work they do is essential to ensuring a sustainable and high-quality aged care sector in the years to come. Much reform work remains ahead of us, and we must all continue to work together to develop and implement solutions that will bolster our aged care workforce and drive sustainable change,” Prior said.

Passing it on

HammondCare Chief Executive Mike said every dollar that flows from the $11 billion commitment over four years that goes to HammondCare will go towards increasing the wages of frontline aged care staff.

Baird said he was delighted on behalf of the 250,000 personal care workers, Registered Nurses, Enrolled Nurses, chefs, recreational activity workers and others in the aged care sector who will benefit.

“Anyone that’s had someone in aged care knows the impact that our aged care workers have. Each day and night they change lives,” Baird said.

The Australian Nursing and Midwifery Federation (ANMF) welcomed the pay rise, but has expressed concerns that underpaid nurses and care workers may be denied better wages, because the “government has failed to impose rules on how providers actually use the money”.

ANMF Federal Secretary Annie Butler said, “We know that some operators will do the right thing and use the money for wages, but the government cannot give it to providers on trust. Trust is not enough. As we’ve seen with previous government investments in aged care, with no accountability mechanisms in place, the money never actually gets into workers’ pockets. And again, with this new funding, providers will be free to use the funding to boost their bottom line, rather than paying their workers. Many have already declared that’s exactly what they intend to do. The government describes this as a ‘historic increase’ to ‘award wages’ but this means thousands of workers on EBAs will get nothing unless the money is tied to employers passing on the money to the workforce.”

Attracting talent

The Older Persons Advocacy Network (OPAN) said more than 250,000 people will benefit from “the biggest pay rise ever awarded in the aged care sector as a result of the 15% increase decided by the Fair Work Commission last year”.

OPAN’s Director Policy and Systemic Advocacy Samantha Edmonds said, “We are pleased that this budget announcement will be passed on in full to the aged care workforce and that there is no additional financial burden on older people or aged care providers.”

“The 15 per cent pay rise means a staff member with a Certificate III qualification moves from earning $940 per week to $1,082 for work which is demanding and largely carried out by women,” said OPAN in a statement.

“It’s a win for women and families struggling with cost-of-living pressures who haven’t been rewarded for the work they do, and we hope this will encourage more people to take up work in the aged care sector,” Edmonds said.

“This sector has suffered from severe workforce shortages while also trying to meet upcoming requirements for increased care and we are hopeful that this funding package will help attract and retain skilled staff.

“We know that older Australians want the people who care for them to be well remunerated for the important services they provide, and this funding boost is a step in the right direction.”

Image caption: iStockphoto.com/South_agency