What happened?
On Wednesday 4 June 2025, the Minister for Health and Ageing, the Hon Mark Butler MP, announced that the Albanese Government will recommend to the Governor-General that she proclaim the commencement of the Aged Care Act 2024 (Cth) (the Act) to be 1 November 2025, rather than the previously anticipated date of 1 July 2025.
What is the immediate impact?
This announcement formally defers the start date of the Act by four months. Aged care providers will now have until 1 November 2025 to become compliant with the new legislation and accompanying rules. Existing obligations under the Aged Care Act 1997 (Cth) will continue to apply until that time.
Why has this happened?
The Government’s decision is a response to sustained advocacy from the sector, which had raised concerns about the ambitious transition timeline. Aged care providers and peak bodies had called for sensible implementation timelines to enable providers to prepare their clients, support their workers and get their systems ready for the transition.
In an open letter to older people, the Minister for Aged Care and Seniors, the Hon Sam Rae MP, explains that a pause is needed to ensure a smoother implementation of the Act and get the reforms “right”.
Minister Rae’s open letter to aged care providers advises that the Government will use this extra time to work with them to:
- help prepare older people for the changes;
- finalise key operational and digital processes; and
- produce implementation guidance and training.
The Minister notes that the pause will also allow Parliament to consider an amendment Bill that will set up the final details of the Aged Care Rules 2025 (Cth) which are currently incomplete and critical to the effective operation of the Act.
How are providers affected?
The extension of time gives providers a sense of relief. However, there is still significant work to be done.
Providers will use this time to:
- update their systems;
- revise client agreements;
- train staff and;
- ensure alignment with the new legislative framework.
What is the impact on the Government?
Although any political backflip is viewed unfavourably, there is broad bipartisan consensus that this was the right decision for older Australians and the aged care sector.
However, the delay is expected to cost the Government approximately $900 million over four years due to postponed implementation of new user contribution arrangements.
Though, the Government will now have sufficient time to:
How does this affect older Australians?
The delay gives older Australians more time to understand their rights and any changes to service and care models, such as the implementation of the new Support at Home program.
Under the “no-worse-off” principle, older Australians who are currently receiving residential or home care services will not see increases to their means-tested contributions. However, certain entrants from 1 November 2025 may be required to contribute more for their care.
Upcoming Russell Kennedy Webinar
The June Webinar Series aims to help providers navigate the key areas of reform under the upcoming Act. We hope you can join us and please feel free to share this with your colleagues.
Session 3 – Support at Home
Wednesday 25 June | 1:00pm – 1:45pm
This session will provide an update on the Support at Home Program, what’s changing, and what providers should be thinking about now in preparation.
Register here
Learn more about the Webinar Series here.
How can we help?
Please reach out if you need any assistance to Victor Harcourt (vharcourt@rk.com.au), Anita Courtney (acourtney@rk.com.au), Solomon Miller (smiller@rk.com.au) or a member from Russell Kennedy's Aged Care Team.
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Disclaimer
The information contained in this Alert is intended as general commentary only and should not be regarded as legal advice. Should you require specific advice on the topics discussed, please contact the firm directly.