"We look after 40,000 very acute, very sick older people and we stop the public hospitals from overflowing," he says.
"This is also about aged care being recognised as a mainstream function of the health system."
He says the association is "really pleased" with today's announcement.
"It's come through a lot of hard work from a lot of people in the sector and today is a day of celebration."
He says the association has been advocating for the nurses it represents to gain pay parity with public hospital nurses for almost three years.
The jump in pay the agreement will afford nurses in the aged care sector was "significant" and he hoped it would help the sector to retain staff.
He says the current pay gap between nurses working in aged care facilities and those working in public hospitals was between $10,000 and $15,000 a year.
"That is the reason why the aged care sector has been losing nurses to public hospitals."
"For the first time, nurses choosing to work in aged care will not be penalised for doing so."
The aged care sector relied heavily on migrant workers and having migrant nurses added to the green list giving them immediate residency was something the association would also like to see happen, Wallace adds.
Fight for GP nurses to gain pay parity continues
The New Zealand Nurses Organisation is also pleased at today's agreement, but its chief executive Paul Goulter told Morning Report the fact GP nurses have not been included is a disappointment.
"We're very pleased, we've been fighting for this for a long time and it's good that the government's finally come round and promised the funding for ... this group."
Goulter says the agreement will stop the "drift out of key areas" such as aged residential care, which is what is happening currently.
"The gaps have just been so big that really they just can't ignore the bigger wages being offered by the hospitals."
However, the organisation is disappointed GP nurses have been left out.
"We - and probably the [GP nurses'] employers - will be thinking about how can we move that along."
He says some GP practices are already paying their nursing staff in line with what hospital nurses received, but in many cases those doing so were using funding that had been provided for other purposes.
"So you're essentially robbing Peter to pay Paul and that's not really sustainable in any way."