Published in: Aged Care

Aged Care Act 1997: What It Was, What It Did & What Replaced It

Author diannemaex

Published on: May 19, 2026

17 minutes read

What Was the Aged Care Act 1997?

The Aged Care Act 1997 (Commonwealth) was the foundational piece of legislation governing how government-funded aged care services were delivered across Australia. Passed by the Australian Parliament in 1997, it remained the primary law regulating the aged care sector for nearly three decades — until it was replaced by the Aged Care Act 2024 on 1 November 2025.

At its core, the Aged Care Act 1997 established the legal framework for how the federal government funded residential care, home care, and flexible care services. It set out who could provide those services, how providers were approved and monitored, what rights care recipients held, and how the system was regulated and enforced.

For families navigating aged care — whether for a parent, a partner, or themselves — understanding the Aged Care Act 1997 matters for two reasons. First, it shaped the system that millions of older Australians and their families dealt with for decades. Second, understanding what it did (and what it failed to do) is the clearest way to understand why the new legislation looks so different.

Why Was the Aged Care Act 1997 Introduced?

Before 1997, aged care in Australia was regulated inconsistently across states and territories. Standards varied significantly depending on where you lived. There was no unified national framework for funding, eligibility, provider accountability, or consumer rights. The federal government stepped in to centralise regulation and create a consistent baseline that applied across the whole country.

The Aged Care Act 1997 achieved this by establishing a single Commonwealth legislative framework that applied to all government-subsidised aged care services — residential aged care homes, home care packages, and flexible care arrangements. Every provider that wanted to receive Commonwealth funding had to operate within this framework, meet consistent standards, and be accountable to a central regulator.

What Did the Aged Care Act 1997 Cover?

The Aged Care Act 1997 was comprehensive legislation touching almost every aspect of government-funded aged care. Here is what each major area of the Act addressed in practice.

Provider Approval and Registration

Under the Act, any organisation wanting to receive Commonwealth funding to deliver aged care had to be formally approved as a provider. Approval was not automatic — providers had to demonstrate financial viability, organisational governance, adequate staffing, and a commitment to meeting quality standards before they could access government subsidies.

Approval could be suspended or revoked if a provider failed to meet their obligations. This was the Act’s primary gatekeeping mechanism — keeping unfit providers out of the system and holding existing providers accountable for maintaining standards over time.

Allocation of Aged Care Places

The 1997 Act gave the Commonwealth government direct control over how many subsidised aged care places were available and where they were located. The government allocated a set number of residential care places and home care packages each year, distributed across regions to ensure some degree of geographic equity.

This allocation system became one of the most criticised aspects of the 1997 Act. Because supply was centrally controlled, demand consistently outstripped availability. By the time the Royal Commission reported in 2021, over 100,000 older Australians were waiting for home care packages — many waiting more than a year for support they urgently needed.

Government Subsidies, Fees, and Charges

The Act set out how the government paid subsidies to approved providers, and what fees providers could charge care recipients. The funding model for residential care went through several iterations under the 1997 framework. The most recent was the AN-ACC (Australian National Aged Care Classification) model, which calculated government subsidies based on each individual resident’s assessed care needs.

For care recipients, the Act permitted providers to charge several different fee types, all of which were subject to caps and disclosure requirements:

Providers were required to give written disclosure of all fees before a resident moved in. Fee caps and means-testing rules were prescribed in the Act and its supporting instruments — providers could not charge whatever they liked.

Types of Care Regulated Under the 1997 Act

The Aged Care Act 1997 regulated three main types of Commonwealth-funded care. Each had its own eligibility criteria, funding rules, and provider obligations.

Key Provisions of the Aged Care Act 1997

The Charter of Aged Care Rights

One of the most practically important elements of the Aged Care Act 1997 framework was the Charter of Aged Care Rights. The Charter set out what every person receiving government-funded aged care was entitled to — whether living in a residential home or receiving care at home through a package.

Providers were legally required to give every care recipient a copy of the Charter before care commenced, and to explain it in plain, accessible language. The Charter had legal force under the Act. However, one of the most persistent criticisms of the 1997 framework was that these rights — while real on paper — were difficult for individuals to enforce in practice. This became a central argument for replacing the Act entirely.

The Aged Care Quality Standards

All approved providers were required to comply with the Aged Care Quality Standards — eight domains that set out the minimum expectations for safe, quality care across the system.

These standards were monitored by the Aged Care Quality and Safety Commission, which conducted unannounced site audits, reviewed complaints, investigated incidents, and could take enforcement action against non-compliant providers — including compliance notices, suspension of approvals, or full revocation of a provider’s registration.

Regulatory Oversight and the Quality and Safety Commission

The Aged Care Quality and Safety Commission was the independent regulator established to oversee compliance with the 1997 Act. Its key functions included registering and monitoring providers, conducting assurance reviews and audits, investigating complaints, applying sanctions, and publishing quality data including Star Ratings.

Under the 1997 Act framework, the Commission operated with meaningful — but ultimately limited — powers. Enforcement was often slow. Families reported that complaints sometimes took months to investigate and resulted in little visible change. These limitations were documented extensively by the Royal Commission and became a key argument for legislative reform.

The Delegated Legislation: Principles and Instruments

The 1997 Act itself set the high-level framework, but much of the practical detail sat in a suite of subordinate instruments made under the Act. These included:

• Aged Care Principles — covering allocation of places, approval of care recipients, care classification, extra services, and transitional arrangements
• Accountability Principles 2014 — requiring providers to maintain sound financial management, governance structures, audit processes, and proper use of Commonwealth funds
• Aged Care (Transitional Provisions) Principles 2014 — handling transitions between care types and arrangements
• User Rights Principles — detailing resident and home care recipient rights in full
• Quality of Care Principles — prescribing the precise care standards providers must meet

This system of delegated legislation gave the 1997 framework flexibility — day-to-day rules could be updated without a full Act of Parliament — but it also made the system complex to navigate for families and providers alike.

Aged Care Act 1997 Summary: What It Got Right and Where It Fell Short

After nearly 30 years in operation, the Aged Care Act 1997 leaves a complicated legacy. It succeeded in creating a national framework where none had existed, establishing baseline standards, and giving older Australians legislated rights for the first time. But by the 2020s, its limitations had become impossible to ignore.

These shortcomings were documented in exhaustive detail by the Royal Commission into Aged Care Quality and Safety (2018–2021), which described the Australian aged care system in its final report as one of “systemic neglect.” Its 148 recommendations became the blueprint for the legislation that replaced the 1997 Act.

The Royal Commission: The Turning Point for the Aged Care Act 1997

The Royal Commission into Aged Care Quality and Safety, established in 2018, was the most significant government inquiry into aged care in Australian history. Over two and a half years, it heard testimony from hundreds of witnesses — residents, families, care workers, providers, and experts — painting a picture of a system under serious strain.

Its final report, delivered in March 2021, was a scathing assessment of a system built on the foundations of the Aged Care Act 1997. The Commissioners found widespread substandard care, chronic understaffing, systemic overuse of chemical restraint, a complaints process that didn’t work, and a legislative framework they described as “fundamentally not fit for purpose.”

The Commission made 148 recommendations. Central among them was a call to write entirely new legislation — not amend the Aged Care Act 1997, but replace it from the ground up with a law centred on human rights and enforceable protections for older Australians.

What Replaced the Aged Care Act 1997?

The Aged Care Act 2024 replaced the Aged Care Act 1997 on 1 November 2025. It simultaneously replaced three pieces of legislation: the Aged Care Act 1997, the Aged Care (Transitional Provisions) Act 1997, and the Aged Care Quality and Safety Commission Act 2018. The government described it as the greatest improvement to aged care in 30 years, backed by a $5.6 billion investment.

The new Act did not simply amend the 1997 framework — it replaced it with legislation built on a fundamentally different philosophy. Where the 1997 Act was structured around what providers must comply with, the 2024 Act is structured around what older people have a legal right to receive.

Aged Care Act 1997 vs Aged Care Act 2024: Key Differences

What the New Aged Care Act 2024 Changed in Practice

A Legally Enforceable Statement of Rights

Under the 1997 Act, the Charter of Aged Care Rights was meaningful but difficult to enforce directly. The new Act introduces a Statement of Rights that carries full legal force — every registered provider must uphold it, and the rights it contains can be enforced through the legal system. This is the most significant philosophical shift in the entire reform package.

Mandatory Staffing in Residential Care

One of the most direct responses to the Royal Commission is the new mandatory staffing requirement. Under the Aged Care Act 2024 framework, all residential aged care homes must provide a minimum of 200 care minutes per resident per day, with at least 40 of those minutes delivered by a registered nurse. A registered nurse must be on-site 24 hours a day, 7 days a week, without exception.

This requirement did not exist under the Aged Care Act 1997. Its absence was one of the primary drivers of the chronic understaffing problems documented so extensively by the Royal Commission.

Support at Home Replacing Home Care Packages

The 1997 Act’s home care framework — four levels of Home Care Packages ranging from entry-level to high-care — was replaced by the Support at Home programme. Support at Home has eight funding levels, the highest reaching $78,106 per year. It also introduced separate budget categories for clinical care, independence support, and everyday living services, giving recipients greater visibility over how their funding is allocated.

The No Worse Off Principle

One of the protections built into the transition from the 1997 Act is the No Worse Off principle. People who were receiving Home Care Packages or were living in residential care before 1 November 2025 are protected — they should not be financially disadvantaged by the move to the new system. If your provider suggests otherwise, this is worth challenging directly, or raising with the Aged Care Quality and Safety Commission.

Does the Aged Care Act 1997 Still Apply to Anyone?

Practical Steps for Families Navigating Aged Care in 2026

Whether you are dealing with the legacy of the Aged Care Act 1997 or entering the system for the first time under the 2024 framework, these steps will help you navigate with confidence.

Frequently Asked Questions — Aged Care Act 1997

Understanding the Aged Care Act 1997 and What It Means for Your Family Today

The Aged Care Act 1997 was not a bad piece of legislation when it was written. In 1997, it brought genuine order to a fragmented national system, established baseline quality standards where none had existed, and gave older Australians legislated rights for the first time. For nearly three decades, it was the backbone of aged care regulation in this country — and it supported the growth of a sector that now assists over 1.5 million Australians every year.

But aged care is not static. The population of older Australians grew substantially. The expectations families hold for the quality, dignity, and safety of care rose significantly. And the Royal Commission into Aged Care Quality and Safety proved what many families had long suspected: that a system built on provider compliance, without enforceable individual rights, without mandatory staffing ratios, and without a fast-acting regulator, was not sufficient to protect vulnerable people in every setting.

The Aged Care Act 1997 is now history. But understanding it remains genuinely valuable — because it explains how the current system evolved, why certain protections exist, and what was hard-won by families, advocates, and care workers who pushed for change over many years. The rights that older Australians now hold under the 2024 Act did not arrive by accident. They arrived because the failures of the 1997 system were documented, publicly scrutinised, and addressed through legislation.

If you are navigating aged care decisions now — whether researching residential care, trying to understand how the new Act affects your family, or helping a parent transition from a Home Care Package to Support at Home — the legal landscape is genuinely stronger than it was. The rights are enforceable. The minimum care requirements are law. The oversight is more robust.

What has not changed — and never will — is the importance of choosing a provider who goes beyond the legal minimums. A provider with a genuine culture of care, not just compliance.

At Superior Care Group, we have been providing residential aged care in Queensland since 1979 — operating through every era of aged care legislation, from the years before the 1997 Act to the new rights-based framework that commenced in 2025. Our family-owned facilities — Wellington Park in Brisbane’s South East and Merrimac Park on the Gold Coast — have adapted to every legislative change, but our commitment to personalised, respectful care has never shifted.

We welcome families who want to ask the hard questions: What staffing levels do you maintain? How do you handle complaints? What does daily life actually look like for residents? These are exactly the questions the Aged Care Act 1997 tried to encourage — and the Aged Care Act 2024 now makes it easier than ever to get honest, transparent answers to.

If you would like to speak with our team about aged care options in Queensland, understand your loved one’s rights under the new framework, or arrange a tour of one of our facilities — we are here.