What is the Business Improvement Fund for Residential Aged Care?
The Business Improvement Fund for Residential Aged Care is a grant opportunity available for eligible providers of residential aged care experiencing financial difficulty, prioritising providers in regional, rural, and remote areas, and small to medium sized providers, with limited access to financial support, that are facing significant financial pressure.
On 31 January 2020, the Government announced the commencement of the Business Improvement Fund for Residential Aged Care Grant Opportunity. The Business Improvement Fund program will provide up to $48.7 million in 2019-20.
The Business Improvement Fund for Residential Aged Care will provide financial support to providers through three streams of grant funding which include:
- Supporting a provider to go through a process of business improvement
- Supporting the sale of the residential aged care facility to another provider
- Where no options exist, supporting the orderly and safe close down of a residential facility
Support provided under the fund will be accompanied by close monitoring of financial performance to decrease the likelihood of future viability or quality assurance issues and ensure accountability for funds provided.
The Australian Government has announced a package of up to $48.7 million (GST exclusive) to support the Business Improvement Fund for Residential Aged Care Grant Opportunity for the 2019-20 financial year.
The Business Improvement Fund for Residential Aged Care Grant Opportunity is available to eligible providers to apply for a Business Improvement grants from one of the following three streams:
Stream 1 (Business Improvement)
- Up to $7,500 x the number of operational aged care places for each residential care facility facing significant financial risk.
Stream 2 (Sale of residential aged care facility)
- Up to $15,000 x the number of operational aged care places for each residential care facility facing significant financial risk.
Stream 3 (Closure of a facility)
- Up to $7,500 x the number of operational aged care places in the residential care facility that is being sold or closed.
To be eligible for the Business Improvement Fund for Residential Aged Care, you must provide activities to support:
- business improvement activities to improve the viability and sustainability of the provider’s operations
- the sale of a facility to another provider that will increase the likelihood of providing viable and sustainable aged care services in the area
- the orderly and safe closure of a residential facility where no other option exists.
Stream 1 – Business improvement expenditure
Eligible expenditure items can include:
- support to assist and implement restructuring/changes to business operations
- minor capital works to improve business operations up to $150,000 (GST exclusive)
- investment in financial management and IT systems that will improve business operations
- support to assist in meeting the costs of professional assistance to improve business operations
- non-capital activities, where there is a clear link to show that it will lead to improving the financial viability of the provider
- cost relating to staff recruitment and training
- minor equipment purchases to improve business operations
Stream 2 – Sale of residential aged care facility activities
Eligible expenditure items may include:
- temporary short term operational costs (generally up to 3 months) pending a sale process may be provided to the existing provider (or administrator). This would generally be in cases where there is no other reasonable source of funding available to support the sale process.
- Support in conducting an EOI process to support the sale of a residential care facility; and
- Incentivising payment to new provider
Stream 3 – Closure of residential aged care facility activities
Eligible expenditure items can include:
- Where a decision has been taken to close a facility, eligible expenditure may include funding some short-term operational costs (generally up to 3 months) for the time it takes to relocate residents in an orderly and safe manner. Operating costs would be over and above those that would be reasonably expected to be borne by the business owner or operator (for example if the facility is in administration or liquidation).
- Upon a planned closure, support in relocating
To be eligible for the Business Improvement Fund for Residential Aged Care, your organisation must be a residential aged care provider that:
- has operational residential aged care facilities in Australia including all NATSIFAC residential providers, and local Government residential providers
- has no or limited access to other sources of financial support
- in a financial position impacting significantly on your ability to care for residents or facing reasonably near risks of service closure
- have, or be in the process of applying for a business advisory or independent assessment report (Stream 1 only).
Note: The Application Form (under the heading of Eligibility) also asks for a range of demographic/identifier information (such as whether your entity is run for profit). This information is used to assist the assessment task (by way of collecting summary information in a convenient way). This information may also be used to inform the value for money assessment, as relevant.
Applications close 30 April 2021.