Wednesday 7 October 2026

Labor told older Australians it was taking $3 billion from the higher private health insurance rebate to deliver “more beds, more packages and better care”.

Now aged care providers have shelved plans for 3,661 beds, saying the Albanese Government’s funding is not enough to make them viable.

Shadow Minister for Regional Health Dr Anne Webster MP said Labor’s promises were colliding with reality.

“Mark Butler justified cutting the private health insurance rebate for older Australians by saying the money was needed for aged care. In September he asked: ‘where else are we going to get that $3 billion to invest in the beds that they’ve just been arguing for here?’

“Yet just months later, thousands of planned aged care beds are being shelved. Labor is taking more from older Australians while failing to deliver the additional aged care capacity it promised them”, Dr Webster said.

The Albanese Government has committed $1.7 billion to support construction of 5,000 additional aged care beds each year. Aged Care Minister Sam Rae said the investment would “support the sector to build 5,000 more beds each year”.

But from 1 October, Labor increased the principal AN-ACC care funding rate by just 2.55 per cent, compared with inflation of 3.5 per cent and a 4.75 per cent increase in aged care wages.

Independent modelling commissioned by Ageing Australia found funding needed to increase around 5.2 per cent to reflect providers’ actual cost increases. Victoria alone has 938 beds affected, with 933 in Western Australia and 535 in New South Wales.

Dr Webster said the consequences extended directly into the hospital system.

“Nearly 4,000 older Australians are already stuck in hospitals because there is nowhere appropriate for them to go.

“Australia needs around 10,000 new aged care beds every year just to keep pace with demand, yet only around 800 were built last year.

“This isn’t about numbers on a spreadsheet. It is Mum or Dad waiting for a bed, families desperately searching for care, and hospital beds occupied because an older Australian has nowhere else to go.

“It is even more serious in regional Australia, where choices are already limited and our hospitals cannot become the default aged care provider.

“Labor promised more beds. Instead, providers are shelving them. Older Australians deserve access to care when and where they need it”, Dr Webster said.