Is red tape tying hands which should be used for care?

Regulation is an important part of the care sector. It exists for a good reason — to make sure services are safe, accountable and respectful of the people they support. Whether it’s aged care, disability services, housing support or community services, strong safeguards help protect some of the most vulnerable members of our community.

But there is growing concern that the system designed to keep people safe is becoming increasingly complicated for the organisations trying to deliver care.

A recent report from the Australian Institute of Company Directors looked at the economic cost of regulatory complexity across the country, and the numbers are striking.

According to the report, Australian organisations now spend around $160 billion each year dealing with federal regulatory compliance. That’s about 5.8% of Australia’s GDP. Just 10 years ago, the figure was closer to $65 billion, which shows how quickly compliance demands have grown.

While this research looks at the whole economy, the findings really resonate with the care sector. Community and human service organisations often operate in highly regulated environments. They may report to multiple government departments, accreditation bodies, and funding programs — each with their own reporting systems, standards and documentation requirements.

None of this is surprising. When services support people in vulnerable situations, accountability matters. But the challenge arises when compliance requirements become overly complex, duplicated, or focused heavily on paperwork rather than outcomes.

One of the report’s more interesting findings is how much time organisational leaders are now spending on regulatory oversight. Board members are devoting more than half of their time (around 55%) to compliance-related issues, compared with about 24% a decade ago.

That shift means less time spent on strategy, innovation and thinking about how services can evolve to meet community needs.

For care providers, this can create real pressure. Many organisations in the sector are not-for-profits working with tight budgets and rising demand for services.

When compliance requirements increase, organisations often have little choice but to redirect resources. That might mean hiring compliance specialists, investing in new reporting systems, or spending hours preparing documentation for different regulators.

Across the broader economy, the number of compliance roles has doubled since 2010. While these positions are important, they also represent resources that might otherwise have been directed toward frontline work.

It’s important to be clear: the sector is not calling for regulation to disappear. Strong standards are critical for protecting people and maintaining trust in care services. What many organisations are asking for is smarter regulation.

Smarter regulation might mean simplifying reporting processes, aligning requirements across different agencies, or reviewing older rules to make sure they still serve a clear purpose. In many cases, organisations are required to provide the same information in slightly different formats to multiple regulators — something that creates work without necessarily improving safety or quality.

When regulation works well, it supports good services and protects people at the same time. When it becomes too complex, it can unintentionally pull time, energy and funding away from the people who need support.

For the care sector, getting the balance right is crucial. Reducing unnecessary complexity would allow organisations to focus more on what they do best — providing care, strengthening communities, and supporting people to live better lives.