Two Thirds of Australians Reject Reverse Mortgages for Aged Care

The Australia Institute for Combined Pensioners and Superannuants Association (CPSA) has called on the Federal Government to abandon the recommendations of the Productivity Commission’s report ‘Caring for Older Australians’ following the results of its nationwide survey.

The call comes as the National Aged Care Alliance (NACA) and The Council on the Aging COTA have spoken in favour of the reforms at the National Press Club in Canberra.

The CPSA says a nationwide survey has found that two-in-three Australians reject the notion that anyone should be forced to sell or reverse mortgage the family home to access aged care, as proposed by the Productivity Commission report ‘Caring for Older Australians.

“If not forced or effectively forced through inclusion of the family home in the aged care means test, the idea of the Federal Government sponsoring access to a reverse mortgage of the family home to pay for aged care received 50-50 support,” said CPSA Senior Policy/Research Officer, Antoine Mangion.

“If the element of compulsion were to be introduced, the support rate for selling or reverse mortgaging the family home dropped dramatically: more than two-thirds of respondents were opposed to being made to sell or reverse mortgage the home to pay for aged care.

“Only five per cent of respondents strongly supported the Productivity Commission’s proposal to force people to sell or reverse mortgage the family home to pay for aged care.

“Clearly, the Federal Government must steer clear of compulsory sale or reverse mortgage of the family home to fund aged care."

The findings of this survey follow a presentation at the National Press Club today by the National Aged Care Alliance (NACA).

In a continuing war of words, the Combined Pensioners and Superannuants Association, CPSA has described the NACA as an aged care provider lobby group whose main function in life is to cry poor on behalf of the nursing home industry.

The CPSA has also criticised the Council on the Ageing COTA for joining the NACA in supporting the Productivity Commission’s recommendation.

"CPSA supports a social insurance approach to the funding of aged, disability, general health and dental care, but recognises that this approach to aged care funding should have been taken decades ago,” Mangion said.

"CPSA wants a progressive approach to levying co-contributions for care costs. Progressive means that people with more assets should pay more than people with fewer assets.

“When people bought their home, they never thought that it could be taken away. People have put their lives into their homes. Fire selling and fire reverse mortgaging family homes rips away people’s safety net. That’s why the home should be excluded from the means test for care cost co-contributions. Few pensioners live in million dollar homes. If they did, they wouldn’t be pensioners.

"Rather than making people gradually hand over their home equity to aged care providers when they go into a nursing home, people should have the option to buy a nursing home place which they or their heirs can later sell, just like a unit in a retirement village can be sold.

Details of the CPSA survey can be found at: 2012-03 omnibus – survey results – combined pensioners superannuants association.xlsx [Excel 2007 Spreadsheet – 51.48 KB]
a nationwide survey by the australia institute for the combined pensioners and superannuants association – methodology and questions.docx [Word 2007 Document – 101.17 KB]