The retirement living sector is poised for a transformative and promising decade ahead, catering to a fresh generation of senior Australians.
The driving force behind this change is Australia’s aging population. In the next ten years, the number of Baby Boomers reaching retirement age will surge by 50 per cent, leading to a significant increase in the population of individuals aged 75 and above, projected to rise from 1.21 million to 2.1 million.
Dr Jane Barratt, Secretary General for the International Federation on Ageing, an international non-government organisation with general consultative status with the United Nations and its agencies including formal relations with the World Health Organisation, said we are currently at the “nexus” of what the next generation of the retirement industry will look like in the future.
“We all are today growing older, with increasing chronic conditions that impact our function and impact our degree of frailty, and that impacts [the retirement industry],” she said at the recent Retirement Living Summit.
While Dr Barratt said it is a good thing the world is ageing, it comes with a set of challenges.
It was with this in mind that the UN called this decade the “Decade of Healthy Ageing” with the goal of improving the lives of older people, their families and communities they live in.
It calls for the creation of age-friendly environments, to combat ageism, create integrated care and provide long-term care.
She said the Australian Government has signed on to the initiative, and that this would have pull through for the retirement industry.
Dr Barratt said wellbeing encompasses all parts of the industry, whether it’s the physical, social or economic environment.
She said there is a three tired system for functional ability – which consists of the intrinsic capacity of the individual, relevant environmental characteristics and the interaction between them – starting at significant or stable capacity, then declining capacity and finally significant loss of capacity.
Dr Barratt said it is vitally important for the retirement industry to create an environment that maintains and improves function and that creating this environment, and measuring its impact, is a competitive advantage for the industry.
“At every single point in that, what we should be doing as providers or providers of facilities is trying to understand what is going to make the difference in someone’s functional ability, because a dependency model doesn’t work,” she said.
“In Hong Kong, the incentivization is: if an older person can maintain their function, the provider of services is incentivised. But in most countries, and Australia is the same, it’s the other way around, greater dependency, greater money, and that needs to change.”
Dr Barrat said the Australian retirement industry has grown in leaps and bounds in the last 20 years.
“It’s not only grown, but it’s become more mature and sophisticated. I challenge [the industry] to talk about services. We don’t want to be cared for, but we want to have services that enable us, services that enable function, enable me to do what I want to do,” she said.
“Creating dependency is not going to be a strong profit margin. So, what we have to do is flip it on its head. And we really have to think about how is the environment you’re creating – both people wise and architectural wise – going to further the health and wellbeing?”
Dr Barratt said Australia has one of the best systems in the world, but noted the government still needs to provide support.
“Our standards are actually very high, and you will always have things that will break down unless you invest in the future,” she said.
“Unless the government is prepared to invest in the system it’s going to be very difficult.
“But aged care is not the retirement industry… and what we need to be doing here is thinking about how can you create the environment or healthy living for as long as possible, which is not the job of the aged care industry.”