Source: Aged Care Association
The Aged Care Association says Budget 2026 has missed a critical opportunity to stabilise aged residential care, warning that continued closures and mothballing of beds will place even greater pressure on hospitals, families and communities.
Chief Executive Hon. Tracey Martin says governments of all colours continue to make the same mistake. “They treat aged residential care as something separate from the health system when, in reality, aged care is health care.”
“New Zealand can build more hospital beds, employ more hospital staff and spend billions on hospital infrastructure, but if aged residential care continues to decline, hospitals will continue to struggle.”tin says aged residential care is an essential part of the health system, providing hospital-level care, dementia care, respite care, rehabilitation and end-of-life care to thousands of New Zealanders every day.
“When aged care works, hospitals work better. When aged care fails, the health system fails.”
The Association says the consequences are already being felt across the country.
“Across New Zealand, aged residential care facilities have been and are being mothballed because the funding model no longer covers the true cost of care. These are beds that communities need and providers want to operate, but the economics simply do not work.”
“Just a fortnight ago, one of New Zealand’s leading charities announced the closure of another 40-bed facility. That closure was not driven by a lack of demand. It was driven by a lack of sustainable funding.”
Martin says every bed that disappears has a direct impact on older New Zealanders and their families.
“When a local care facility closes, the burden does not fall on government departments or officials in Wellington. It falls on husbands and wives who have spent a lifetime together. It falls on sons and daughters trying to support ageing parents. It falls on families who suddenly find that the care their loved one needs is no longer available in their community.”
“In some cases, older couples are separated because there is no suitable bed available close to home. Families who once visited daily find themselves travelling hours to see a parent or partner.”
“These are not statistics. These are real people and real families paying the price for a system that has been allowed to drift for too long.”
The Association welcomed the establishment of the Ministerial Advisory Group on Aged Care but says waiting for long-term reform should not have prevented action in this year’s Budget.
“The Government has acknowledged that reform is needed. The problem is that while we wait for reform, facilities continue to close and capacity continues to disappear.”
Martin says a targeted infrastructure grant fund focused on standard aged care beds could have helped stabilise capacity while broader reforms are developed.
“Just one percent of the infrastructure funding already set aside by Government, targeted at the communities most at risk, could have helped preserve and grow desperately needed care capacity.”
The Association says New Zealand must stop viewing aged care as separate from the rest of the health system.
“Aged care is not the end of the health system. It is a critical part of it.”
“If we want fewer people waiting in emergency departments, fewer delayed hospital discharges and a health system that works better for everyone, then we must invest in aged residential care.”
“The reality is simple. If aged care fails, the health system fails.”