Aged care reforms pushed to November

The government is delaying the implementation of the new Aged Care Act until November 1 following widespread concerns that stakeholders weren't given enough time to prepare.

The new legislation was due to commence from 1 July 2025. Now, it will be effective 1 November 2025.

In addition to insufficient preparation time for stakeholders, the government still needs to finalise the Aged Care Rules which will inform parts of the legislation. This requires an amendment bill to be tabled in Parliament; there is still no indication as to when this will happen.

"The Albanese government has made no secret of the fact that this is an incredibly ambitious reform," ministers for health and ageing Mark Butler said.

"These are once-in-a-generation reforms, which put older Australians at the centre of aged care.

"We want to make sure that all operational, digital and legislative pieces are in place before the rollout starts. This brief deferral allows providers to train their staff and have conversations with their clients, get their IT systems ready and prepare operations for an orderly transition."

The reforms have also been a point of concern for financial advisers, with the BT Technical team seeing more than 1100 advisers register for a recent webinar on the topic.

Challenger's head of technical services Andrew Lowe recently told Financial Standard that in May more than 40% of all calls to its technical team were related to these reforms.

The changes mean those entering aged care must make larger means-tested contributions, while those already in or receiving aged care will be "no worse off."

"We applaud the government for listening to the concerns of the aged care sector and putting the needs of older Australians first," Ageing Australia chief executive Tom Symondson said."We fully support the new rights-based Aged Care Act, but the simple truth is we're not ready to introduce all the sweeping reforms by July 1.  Providers have been working around the clock to ensure a smooth transition, but we just haven't received all the information we need in order to proceed.

"The additional time will give us the critical space we need to finalise agreements, systems, and processes."

He said the delay marks a win for the 1.4 million older Australians who rely on aged care.

"We need to do this reform once and do it right. We hope this extension will help us get closer to that goal," he said.