Zero Real Interest Loans
This page contains information about the zero real interest loans measure; also see zero real interest loans results and loan agreement.
In 2008, the Government announced details of the New Directions for Older Australians: Improving the transition between hospital and aged care package which included a commitment to provide, through two funding rounds, up to $300 million in zero real interest loans to residential aged care providers to build or expand residential aged care facilities in areas of high need.
The objective of the program is to encourage providers of residential aged care, through the provision of low cost finance, to establish residential aged care services in areas where they have previously been less likely to invest.
In 2010, as part of the National Health and Hospital Network, the Government announced an extension to the program of a further two funding rounds to provide an additional $300 million in loans and 2,500 residential aged care places.
As part of the extension, the Government modified the program to:
- allow providers to apply for loans in respect of provisionally allocated residential aged care places for services within identified areas of high need (provisionally allocated places are places already allocated to a provider but are not yet operational);
- extend the loan repayment period from 12 to 22 years; and
- expand the definition of a ‘high need area’ to include areas with relatively higher numbers of Long Stay Older Patients.
Funding RoundsTo date, the Department of Health and Ageing has completed three zero real interest loans funding rounds, resulting in offers of over $447 million in loans and 3,139 new residential aged care places to providers around Australia.
Round OneThe first loans round was completed in September 2008. Forty approved providers were offered $150 million in zero real interest loans and 1,348 new residential places and 107 new community places. A summary of the results of the first loans round can be found at the Zero Real Interest Loans Results web page.
Round TwoThe second loans round, run in conjunction with the 2009-10 Aged Care Approvals Round, was completed in December 2010. Nineteen approved providers were offered $147 million in zero real interest loans and 819 new residential aged care places. A summary of the results of the second loans round can be found at the Zero Real Interest Loans Results web page.
Round ThreeThe third loans round, run in conjunction with the 2011 Aged Care Approvals Round, was completed in December 2011. Twenty-five approved providers were offered $150 million in zero real interest loans and 972 new residential aged care places (and 147 provisionally allocated places). A summary of the results of the third loans round can be found at the Zero Real Interest Loans Results web page.
Round FourA further $150 million in zero real interest loans will be made available as part of the 2012 Aged Care Approvals Round.
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