National mental health report 2013

2.2 National spending on mental health

Page last updated: 2013

Key messages:

  • The original commitment made by all governments to protect mental health resources under the National Mental Health Strategy has been met. Total government expenditure on mental health increased by 178% in real terms between 1992-93 and 2010-11. In 2010-11, Australia spent $4.2 billion more of public funds on mental health services than it did at the commencement of the Strategy in 1992-93.
  • Until recently, growth in mental health spending mirrored overall health expenditure trends for most of the 18 year period since the Strategy began. In the most recent year (2010-11), mental health increased its position in terms of relative spending within the broader health sector.
  • Australian Government spending has increased by 245% compared to an increase of 151% by state and territory governments. This increased the Australian Government share of total national spending on mental health from 28% in 1992-93 to 35% in 2010-11. Most of the increase in Australian Government spending in the first ten years of the Strategy was driven by increased outlays on psychiatric medicines subsidised through the Pharmaceutical Benefits Scheme, but more recently other activities have taken over as the main drivers of increased mental health spending.
  • The considerable variation in funding between the states and territories that existed at the beginning of the Strategy is still evident 18 years later, mid-way through the Fourth National Mental Health Plan. The gap between the highest spending and the lowest spending jurisdiction increased over the 1992-93 to 2010-11 period. The disparity between the states and territories points to wide variation in the level of mental health services available to their populations.
  • Despite claims to the contrary, there are no reliable international benchmarks by which to judge Australia's relative investment in mental health. These await international collaboration on costing standards to ensure 'like with like' comparisons.
Public reporting on the level of spending on mental health services has been a central function of previous National Mental Health Reports. Under the First National Mental Health Plan, all governments agreed to maintain a level of expenditure on specialised mental health services at least equivalent to the level at the beginning of the National Mental Health Strategy, and to review annually whether this was occurring.

Regular monitoring of the relative contributions of the main funding authorities responsible for mental health services also serves as a check against the possibility that the reform process may simply lead to shifts of financial responsibility from one funder to another, rather than overall growth in services. This was a concern expressed by advocacy groups at the outset of the Strategy.

This section of the report provides an overview of 2010-11 spending on mental health services within the context of information about spending patterns since the Strategy began.