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New Zealanders are living longer and the number of people aged over 85 is increasing, a trend expected to create extreme pressure on aged-care facilities, particularly in the next 20 years as the "baby boom" generation passes retirement age.
The report, commissioned from the New Zealand Institute of Economic Research by lobby group Aged Care Matters, said the South was one of the four regions most endowed with aged residential care beds, an estimated 3000-6000 places.
However, reflecting the region’s highly rural nature, many communities had fewer than 50 beds available.
The report said the South was expected to have lower than the national average of people aged over 85 in the coming years, and had one of the highest percentage rates of beds for that demographic.
Birchleigh Residential Care Centre chief executive Malcolm Hendry, the southern representative on the New Zealand Aged Care Association board, said it was difficult to predict how the region would cope with the projected increase in aged-care demand.
"We do not know what construction of new facilities is planned and how many older facilities might close," he said.
"What we do know is that some of the major corporates are cutting back on development plans because new aged-care facilities are currently not financially viable."
Even if new facilities were constructed, registered nurse and healthcare assistant shortages would likely make it difficult to find the staff required.
"It is very difficult at present to accurately assess how many beds are truly available.
"The current occupancy figures across the region do not reflect the fact that many of the empty beds cannot be utilised, because facilities simply do not have the staff [needed]."
Several southern aged-care facilities had already reached capacity in specific levels of care, especially dementia and hospital level, Mr Hendry said.
Even modest population growth would likely put additional strain on an already-stretched system, he said.
The report said the country’s falling rate of home ownership was a concern, as many people sold their home to finance a place in aged residential care.
"There has also been little investment in building new or upgrading aged residential care facilities outside the retirement village sector, where the facilities are increasingly integrated with their wider residential offerings ... overall, there is an increasing gap between those that can afford to pay for aged residential care and those that have to rely on the basic care."