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The issue of our age

Australia’s population is growing older at a faster rate than ever before, so experts are sounding off now on the best ways to manage this unprecedented demographic shift. By Angela Tufvesson.

Experts in aged care and public policy came together at the recent COTA Australia national policy forum to discuss an integrated response to our rapidly ageing population.

In his presentation at the forum, Travers McLeod, chief executive of the Centre for Policy Development, quoted then Prime Minister Harold Holt in his 1967 speech “Advance Australia”: “We are getting younger as a people. The median age of the population is being lowered … Our population age structure is such that … there is no indication in sight of any significant upward trend … Whatever the future may hold, we as a government will remain sensitive to the play of the many forces and do what we can to keep them in productive balance.”

Fast forward nearly half a century. How times have changed. When Holt delivered his address there were about eight Australians working for every Australian over the age of 65. Now the over 65s are each supported by five working Australians. By 2050, it is projected to be less than three. By 2100 there will probably be more people aged over 100 than babies born in that year.

Fellow forum presenter demographer Graeme Hugo, an ARC Australian professorial fellow, professor of geography and director of the Australian Population and Migration Research Centre at the University of Adelaide, says our ageing population is one of the few certainties for which policymakers and industry can plan.

“There’s virtually nothing one can be certain about in Australia over the next 20 years … whereas we do know the numbers that are going to be in those aged groups,” he says.

So what needs to be done to ensure Australia is an equitable and prosperous place to live for this ageing population in the coming decades? 

Number crunching 

Experts may have difficulty accurately predicting economic fluctuations or housing prices, but there is a high degree of certainly regarding projections of the number of older people. Why? Compared with previous migrant-heavy generations, the 60- and 70-year-olds of the 2020s and 2030s are already living in Australia. Plus, we know where they live and their economic and social characteristics.

The retirees of the near future will have different needs to the current crop of older Australians. “Baby boomers [have massive differences] to the previous generation of older people so we can’t expect in terms of housing and care that they will need or want the same things as the previous generation,” professor Hugo says.

Virtually all of the current generation of older people entered retirement as couples, whereas about one-quarter of baby boomers are single, which poses different challenges for housing, mental health and economic mobility. What’s more, 40 per cent of baby boomers were born overseas, compared with about one-fifth of the previous generation. And they have fewer children to help with the demands of older age.

Positive ageing 

Adjunct professor John Kelly, chief executive of Aged & Community Services Australia, says governments, consumers, providers of care and employees within the residential aged care system support the provision of reasonable and affordable consumer choice.

“I think that’s a big positive,” Kelly says. “We’re moving from probably a more common circumstance where consumers were hampered within that process and now everyone is lined up to encourage consumers to play an active role in the implementation of their care.

“We’ve increased the number of home care places, the government and various stakeholder groups all agree that’s a good move so that people can be looked after in their homes for longer. What that means is probably for those who need some level of support and want to continue to optimise their healthy lifestyle they can remain at home but still receive some care – probably through to the mid-80s or later, depending on the individual.”

McLeod says the key to adjusting to the demographic shift is viewing it as an opportunity to be embraced instead of a problem that needs to be managed. “It’s been too often compartmentalised into a set of problems that societies need to manage instead of the opportunity that longevity of a population offers in terms of intergenerational stewardship and growth through older age,” he explains. “Longer life expectancy is something to be proud of and excited about, and it’s important to think about how we can manage it in a positive way … rather than being unnecessarily despondent about having an older population.”

He says there’s much to be gained by viewing an ageing population within a broader context rather than “slicing and dicing the issues into neat boxes”, in much the same way as issues such as urbanisation, inequality, resource scarcity and the burden of chronic disease are best examined interdependently.

Much of the world is facing a similar demographic shift, and McLeod says Australia can learn a lot from the experiences of other countries. “In Europe, half the population will be over 50 by the end of this decade and there are many countries, including in Asia, that are dealing with a changing demography much earlier than Australia,” he says. “There’s a lot to be learnt from best practice around the world instead of trying to reinvent the wheel in terms of how we think about handling a changing demography.”

The way forward

Anticipating the numbers, characteristics and geographic spread of the older populations of the future is crucial when it comes to the provision of aged-care services. Hugo says considerable lead-up times are required, especially in the residential care sector, as well as massive investments to meet the inevitable increase in demand – especially in the aged-care workforce.

“We’ve done some projections about what the demand for care workers is going to be in terms of numbers and it’s really spectacular – the need within the next two decades will double,” Hugo says. “The planning for that needs to happen now. It’s going to be too late in 20 years, as we’ll need to find a huge number of workers, whereas if you start up that process now it’s going to be much easier to deal with.”

McLeod says one of the main workforce issues is focusing on paid work over the high proportion of voluntary and unpaid work within the sector, which is linked to our reliance on income tax.

“The way we measure output, productivity and growth doesn’t capture all of that work,” he says. “We need to get better at how we measure that sort of employment, that sort of activity in an economy, which is no doubt beneficial to society but not captured in our traditional indicators.

“Our tax system hasn’t evolved much over the last few decades – we still have an unhealthy reliance on income tax – and we need to think about the balance of taxes falling on jobs, wealth and consumption. Whether Australia needs comprehensive tax reform is a theme in other debates, and it’s certainly one of the big issues we need to think through given much more of our working population will be of an older age.”

Crystal ball gazing

COTA Australia chief executive Ian Yates says there was a strong consensus amongst presenters at the national policy forum that the aged-care industry needs to encourage a more explicit conversation about public policy objectives and how they can best be achieved.

“What do we think Australians need to address with an ageing population and what are the policies that will get us there across the board to cover employment, housing, health, transport, income security and more?” he says.

Yates says his organisation is concerned that people with less income and assets are more vulnerable than more affluent older Australians, but is keen to emphasise that issues relating to the ageing population aren’t solely a government responsibility.

“What we’re essentially doing at the moment is cutting transfers to them – for example the aged pension – at the same time as we’re giving massive superannuation concessions to people who are quite well off, and these settings don’t make sense,” he says. “We deliberately talk about government taking the lead but developing a workforce strategy in aged care is not a government responsibility, it’s the sector’s responsibility, in which government can play a facilitating role. If we don’t plan, it’s an absolute failure of good public policy.”

The Centre for Policy Development’s McLeod agrees that broader discourse is essential. “There was a consensus [at the national policy forum] that we need an agreed-upon set of values and principles, perhaps even a longer-term planning process, that brings the major political parties and stakeholders – like COTA policy experts, industry members, academia and civil society representatives – together. Such a process would provide the cover and the space for common objectives to be set and for policy development to outlast political cycles. Otherwise, too many of the reforms are incremental quick fixes, instead of policies that can be productive, sustainable and fair across the long term.”

In an ideal future, Aged & Community Services Australia’s Kelly says, older Australians would be healthier and able to stay at home for even longer than they are now as a result of policy change that would offer ongoing financial benefits as well as improvement to Australia’s social fabric.

“Looking at the evidence, the greatest amount of money we spend on our healthcare is in the last couple of years of our life,” he says. “That’s when it gets very expensive because you become quite fragile at those end points in your life.

“If we had a snapshot of 20 years [from now] it would be older Australians staying in their homes a lot longer, being a lot more independent during that period of time and receiving support to enable them to continue to live a life independently.

“On top of that, you would see a far more active role for those same people in the community. It’s not enough that they’re alive and well and living in their home, but that they’re active within the community they live in.”

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