EXPLANATORY STATEMENT
AGED CARE ACT 1997
SECTION 44-6
DETERMINATION OF RATES OF FINANCIAL ASSISTANCE
(ACA Ch. 3 No. 7/2007)
CONCESSIONAL RESIDENT SUPPLEMENT
Subsection 44-6(4) of the Aged Care Act 1997 (the Act) provides that the Minister may determine in writing the amount of the concessional resident supplement.
The concessional resident supplement is an additional daily amount that is paid to services for each concessional resident and assisted resident occupying a place in the service.
A concessional resident is a person who is considered unable to afford to pay an accommodation bond or an accommodation charge and meets the requirements of section 44-7 of the Act. An assisted resident is a person who can only afford to pay a small accommodation bond or a small accommodation charge and meets the requirements of section 44-8 of the Act. Providers are required to set aside a certain number of places for such residents.
This determination sets the concessional resident supplement rates, including the concessional resident rate for assisted residents under subsection 44-6(6), with effect from 1 July 2007.
All residential care subsidy rates are indexed on 1 July each year. The index incorporates movements in wage costs and non-wage costs. The wage costs component is calculated using the annualised dollar figure of the October 2006 Federal Minimum Wage decision of the Australian Fair Pay Commission expressed as a proportion of the (latest available) Average Weekly Ordinary Time Earnings at the time of the AFPC decision. The non-wage costs index is based on the Consumer Price Index exclusive of the impact of A New Tax System consistent with a whole of government decision.
Consultation
As the indexation of this supplement uses a well established formula for indexation, no specific consultation with industry was undertaken with respect to this instrument.
Overview
The Aged Care Act 1997 was enacted to establish a framework for the provision of aged care services in Australia, ensuring that older Australians receive appropriate care and support. Section 44-6 of the Act, particularly subsection 44-6(4), empowers the Minister to determine the amount of the concessional resident supplement, which is an additional financial assistance provided to care services for residents who cannot afford standard accommodation charges. This supplement is crucial for enabling these services to continue offering care to financially disadvantaged residents. The determination of these rates, including those for assisted residents under subsection 44-6(6), was made effective from 1 July 2007, and these rates are indexed annually on 1 July, taking into account wage and non-wage costs. The indexation formula, which incorporates the annualised dollar figure of the Federal Minimum Wage and the Consumer Price Index, ensures that the supplement remains reflective of current economic conditions. The determination process was conducted by the relevant authority under the Act, with no specific industry consultation required due to the established nature of the indexation formula.
Scope and Application
The Aged Care Act 1997, as amended by the F2007L02036 determination, governs the provision of the concessional resident supplement for individuals who qualify as concessional or assisted residents. This supplement is payable to service providers for each eligible resident occupying a place in a service, with concessional residents being those unable to afford an accommodation bond or charge and meeting the criteria of section 44-7, and assisted residents those who can only afford a small accommodation bond or charge and meet the criteria of section 44-8. Service providers are mandated to reserve a certain number of places for these residents. The Act applies to all entities providing residential aged care services in Australia, ensuring that the supplement is provided consistently across the nation. The rates for the concessional resident supplement are indexed annually on 1 July, incorporating adjustments based on wage costs and non-wage costs. The wage costs component is derived from the Federal Minimum Wage, while the non-wage costs are based on the Consumer Price Index excluding tax impacts, ensuring that the supplement reflects current economic conditions. This determination, effective from 1 July 2007, specifies the rates for the concessional resident supplement, including the rate for assisted residents.
Key Provisions
The Aged Care Act 1997, specifically under section 44-6, allows the Minister to determine the amount of the concessional resident supplement. This supplement is an additional daily amount paid to services for each concessional resident and assisted resident occupying a place in the service (subsection 44-6(4)). A concessional resident is defined as someone unable to afford an accommodation bond or charge and meeting the requirements of section 44-7. An assisted resident, on the other hand, can afford only a small bond or charge and meets the criteria in section 44-8. Service providers are mandated to set aside a certain number of places for these residents.
Under the Act, providers must adhere to several obligations and requirements concerning the concessional resident supplement. They must ensure that the appropriate number of places are reserved for concessional and assisted residents, and they must correctly apply the supplement rates set by the Minister. Additionally, providers must maintain records of the accommodation bonds or charges paid by residents and ensure transparency in the application of the supplement.
In terms of breaches and consequences, the Act does not specify detailed offences or penalties within the excerpt provided. However, failure to comply with the requirements regarding the concessional resident supplement could potentially lead to regulatory scrutiny, fines, or other administrative actions as deemed necessary by the relevant authorities. The emphasis is on ensuring that the supplement is correctly applied and that the appropriate residents receive the intended financial assistance.