Government breaks promise, imposing tax on aged care workers’ retention bonus

The Australian Nursing and Midwifery Federation (ANMF) has questioned the federal government’s actions over yet another broken promise after it was revealed that its ‘retention bonus’ for aged care workers at the forefront of fighting COVID-19 will now be taxed.


In March, Aged Care Minister Richard Colbeck wrote to thousands of aged care workers promising a $234.9 million ‘retention bonus’ of ‘up to $800 after tax’ for two quarters.

But the latest update regarding the ‘retention bonus’ released by the Department of Health last week exposed a major government backflip, with the payment to now be considered as income and taxed accordingly.

“Our affected members in aged care are dismayed and disappointed but they’re not surprised as this is far from the first time they’ve been let down by the government,” ANMF Federal Secretary Annie Butler said.

“This bonus was intended to recognise the dedication and commitment aged care workers have continued to show in treating and protecting older Australians during the crisis, potentially putting their own safety and their families’ safety at risk.

“But just as we’ve gained control over the pandemic, with aged care workers weathering the storm on the path to recovery, the government has backflipped on its promise and now said we don’t actually think you’re worth the full amount.”

Ms Butler said the ‘retention bonus’ had been clouded in confusion from the moment it was announced, with clear details regarding how the bonus would work, who would be eligible and how applications could be made not provided.

“We’ve also been told by some of our members that their employers aren’t even aware that the bonus scheme exists,” she added.

Ms Butler said the ANMF had been in regular contact with Mr Colbeck throughout the COVID-19 pandemic and assisted the Government as much as possible in developing and implementing the nation’s response to the coronavirus across aged care facilities and the wider community.

Yet despite the collaboration, she said the Aged Care Minister had reneged on his promise to recognise heroic aged care workers by providing the full bonus.

To compound the development, Ms Butler said ANMF members working in nursing, midwifery and aged care would also be negatively impacted by the Government’s announcement that Australia’s full childcare assistance program will end on 12 July.

“In times of crisis, our members often become the sole income-earners in their families; this has continued to be the case during the COVID-19 pandemic. While families continue to struggle as the country takes the long path to economic recovery, it’s critical that we continue to support those still in work and recognise the vital importance of female dominated industries in that recovery.”

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