Since pronounced aging of the population became evident in the 1976 Australian census, there have been repeated expressions of concern about the health care costs associated with this trend. The latest of these has come from the National Commission of Audit (NCA) which was established by the newly elected conservative Commonwealth Government in June 1996 to undertake a wide-ranging review of the financial position of the Commonwealth Government. The Terms of Reference on which the NCA was to report included 'the impact of demographic change on Commonwealth finances, with the intention of making recommendations as to how emerging pressures could be provisioned'. Many of the themes canvassed in its report are in common with those raised in analyses of the implications of aging for health care costs in other countries, but some reflect particular characteristics of the Australian aged care system and social policy context.