2024 Federal Budget Announcement

Finally the highly anticipated budget is out! But do you think the expectations for our sector were met or missed?  

In our view, Dr. Jim Chalmers faced quite a balancing act with this latest budget, especially considering the challenges facing sectors like aged care, health, retirement living, and social services. While there was anticipation for positive developments in these areas, it seems like the announcements may have left some stakeholders disappointed.

For aged care and retirement living providers, as well as representative bodies, the absence of references to the findings of the Aged Care Taskforce and any concrete plans for the future might have been frustrating. Similarly, critical players in the retirement living sector, along with the Retirement Living Council, may have felt that their hopes for increased attention to the sector were not met.

Nevertheless, it’s important to recognise the complexity of balancing a federal surplus budget with the needs of various sectors, particularly against the backdrop of state deficits, inflation, and necessary spending. Delivering such a budget is undoubtedly a monumental task for the Labor Party.

While the budget may have had some positive outcomes overall, the real test lies in how the allocated funding translates to tangible support at the facility level, especially in sectors like aged care where financial struggles are prominent. It will be crucial to monitor how effectively the funding provided addresses the challenges faced by these sectors and supports their ongoing operations.

Where to go from here?

Following these outcomes, you and our other aged care providers are continuing to manage the existing challenges and opportunities. Anchor Excellence have put together a comprehensive help list of actionable steps that will help you to gain/stay in control of your sustainability and growth.  

Here is your help list that you can use to navigate the changing landscape and gain/stay in control: 

Develop/Refresh your Financial Strategy

• Develop Financial Strategy:
• Define clear short-term and long-term financial objectives aligned with organisational goals.
• Develop strategies to address immediate challenges while planning for future sustainability.
• Seek professional advice to craft comprehensive financial plans.

Refine Financial Management:

• Conduct thorough financial health checks to streamline financial processes and identify areas for cost reduction, and revenue enhancement.
• Implement regular financial reviews to ensure efficient resource allocation and sustainable operations.
• Seek opportunities to optimise revenue and minimise unnecessary expenses.

Diversify Revenue Sources:

• Evaluate potential avenues for expanding services or introducing new offerings through additional services 
• Identify niche markets or underserved needs to diversify revenue streams.
• Conduct market research to assess viability and demand.

Monitor RADs and Property Values:

• Regularly review RAD levels and adjust pricing strategies to remain competitive.
• Stay informed about market trends in property values to maximise asset potential.
• Explore property development opportunities to enhance asset value.

Optimise Working Capital:

• Review working capital management practices to ensure efficient cash flow.
• Streamline debtor and creditor payment cycles to improve cash conversion.
• Implement strategies to expedite collections and negotiate favourable payment terms.

Revamp Procurement Strategies:

• Review procurement processes to enhance efficiency and compliance.
• Negotiate favourable terms with suppliers and explore bulk purchasing options.
• Foster strategic partnerships to leverage economies of scale and reduce costs.

Keep track of grant opportunities: 

• Identify and apply for relevant grants that will go towards assisting viability
• Utilise the business advisory services funded through the Capital Assistance program.

Strengthen Management Reporting – knowing where you are is important to know to get where you want to be:

• Establish robust reporting systems to track key financial metrics and inform decision-making.
• Ensure timely and accurate reporting to facilitate transparency and accountability.
• Utilise data analytics to identify trends and areas for improvement.

Re-evaluate Operating Model:

• Assess current operations to identify inefficiencies and opportunities for improvement.
• Explore alternative models that better align with evolving industry demands.
• Consider collaborations or partnerships to enhance service delivery and operational efficiency.

Address Staff turnover and invest in high performance:

• Analyse turnover rates and identify factors contributing to attrition.
• Implement retention strategies focused on employee satisfaction and professional development.
• Cultivate a positive work environment that fosters employee engagement and loyalty.
• Invest in your leadership team, leadership is always a key driver of success. Don’t assume they are ok on their own. Take time to help them be more effective and increasing their engagement

Build your well thought out ‘reform transition plan’ for the strengthened aged care standards- take a whole business approach. 

It’s not likely that these will change substantially even with a new Aged Care Act in 2025:

• Start gearing your workforce understanding of a rights based approach
• Audit your document management systems, check you have all topics covered (if you need help reach out to us)
• Plan your staff training plan with a strong focus on your refreshed Policies and processes. Embedding to practise your approach will be key to future success and mitigating compliance risk.
• Reassess your audit plan and look for tracking of key improvements including checking that your dashboard of measures is tracking the new focus.
• Have your key messaging and communications strategy so everyone is reinforcing the same key messages. Be clear on your stakeholder requirements and deploy your communications plan with regard to these diverse requirements and strengthen the relationships with your older people, families, staff and the border community.
• Be 100% confident that your foundation systems are working at optimum- ie complaints, Incident management and SIRS

By proactively implementing some of these strategies, aged care providers can adapt to budget outcomes, strengthen financial resilience, and thrive in an ever-evolving aged care landscape. 

An executive summary and impact on aged care is also provided your reference below:

Executive Summary

• The Albanese Labor Government has prioritised enhancing the quality of life for older Australians by investing significantly in aged care, health, and social services.
• Total investment in aged care has increased by 30%, with a landmark $11.3 billion allocated towards the largest one-off increase in aged care wages.
• Investments in the 2024–25 Budget further strengthen aged care services, improve workforce capabilities, and reinforce the links between aged care and the wider health system, ensuring tangible benefits for older Australians.

Impact on Aged Care

• Investment in Home Care Packages: $531.4 million is allocated to provide an additional 24,100 Home Care Packages in 2024–25, enabling more Australians to age at home.
• Regulatory Enhancement: $111.0 million enhances the capability of the Aged Care Quality and Safety Commission, ensuring older Australians receive safe and quality care.
• Workforce Support: $88.4 million is dedicated to attracting and retaining aged care workers, promoting better staffing solutions and improving workforce stability.
• Technological Infrastructure: $1.4 billion is invested in upgrading technology systems across the aged care sector, supporting the implementation of the new Aged Care Act and maintaining current systems.
• Fairer Wages: Previous investments of $11.3 billion have delivered fairer wages for aged care workers, with further wage increases anticipated following Fair Work Commission decisions.
• Stronger Medicare Integration: $882.2 million strengthens Medicare for older Australians, facilitating better connections between residential aged care, hospitals, and primary care settings.
• Pharmaceutical Benefits: $318 million ensures cheaper medicines for aged care residents through a five-year freeze on the cost of PBS prescriptions, benefiting pensioners and Commonwealth Seniors Health Card Holders.
• Dementia Care: $101.4 million is invested in improving dementia care services and support, preparing the health system for new diagnosis and treatment advances.
• Quality Enhancement: The 2024–25 Budget reinforces the foundations of quality aged care through increased Home Care Packages, workforce support, regulatory enhancements, and stronger health system connections.

These investments underscore the Albanese Government’s commitment to prioritising the well-being of older Australians, ensuring they receive high-quality care and support in their later years. 

We would love to hear your thoughts and anything you need help with.  Feel free to reach out to Cynthia Payne or Payal Kapoor or any of our team members as you deem fit from our team page