Queensland, South Australia and New South Wales 2021 budgets and mental health reform

By Gill Callister PSM

28 June 2021

This past week, state budgets have been released for Queensland, South Australia and New South Wales. They have been eagerly awaited. Will they bring the necessary investment and reform?

The recommendations of the Productivity Commission into Mental Health and the Royal Commission into Victoria’s Mental Health System are milestones in the long struggle to meet the mental health needs of the Australian community.

These inquiries are the result of mental health systems across Australia being so dysfunctional that their failure to support an ever-growing number of people experiencing mental ill-health became impossible to ignore.

Key among their recommendations is that our state and federal mental health systems need not just greater financial investment but the courage to move away from the old hospital-centric treatment model to a more contemporary, flexible and holistic model of mental health - one that recognises that people need different supports at different times and can provide integrated support earlier – not just at crisis point.

Following these inquiries, we have seen significant investment for mental health in the budgets released to date.

The first federal budget after the Productivity Commission included funding for eight adult mental health centres, 24 new satellite centres and ongoing funding for existing centres. This is a great step in the right direction; these hubs will provide a range of support services when and where they are needed. Having services that consumers actually want to engage with is half the battle won.

Having committed to accepting all of the Royal Commission’s recommendations, the Victorian Government’s 2021-22 budget invested an unprecedented $3.8 billion in mental health. This was not just a benchmark financial investment but a seismic structural overhaul in how the system is understood and how services are delivered.

It has responded to the recommendations for a more holistic, community-focused delivery of mental health support geared towards prevention, early intervention and providing the wellbeing supports in the community that consumers need to achieve sustained long-term recovery.

This past week, state budgets have been released for Queensland, South Australia and New South Wales. They have been eagerly awaited by consumers, carers and the mental health sector in these states, who will no doubt be looking to see whether the progress in Victoria is reflected in their home states. A Royal Commission in every state shouldn’t be needed to articulate the pressing need for mental health reform and encourage investment across Australia – so how responsive are they to the evidence and advice of these inquiries?

Australia is on a path to mental health reform and all governments look to be taking steps in the right direction. Collectively these budget announcements demonstrate serious investments in improving mental health services in Australia, along with some disappointments. Here is a brief breakdown of key initiatives in each state budget, after which they will be summarised collectively.

New South Wales

The NSW Government made a huge investment in mental health with $2.6 billion announced for 2021-22. It was clear mental health was a priority for the NSW Government this year, with substantial investment in regional and rural mental health and services for young people.

$109.5 million over four years will be invested to set up 25 multidisciplinary child and adolescent mental health response teams to provide rapid and flexible care to children and adolescents in acute mental distress. This innovative service will also clients with services such as GPs, headspace, and NDIS and housing providers.

Increased funding was also announced for 57 response and recovery specialists across regional and rural NSW to provide mental health support, particularly for those affected by droughts, bushfires, COVID-19 and the recent mice plague. There will also be six new regional family care centres whose staff will include mental health clinicians.

New South Wales’ major investment into improving its mental health system through establishing new and more contemporary services outside of hospitals is encouraging and welcomed.

South Australia

Mental health was a priority for the South Australian Government, with this year’s budget committing $163.5 million over four years towards realising goals in the South Australia Mental Health Services Plan.

We’re excited about the $5 million to support the building of additional accommodation to provide options for people living with mental health disability to live independently while accessing appropriate supports. This model of residential supported independent living is a model we have seen work with great success in Victoria, transforming people’s lives.

Pleasingly, the South Australian Government announced its 16-bed crisis stabilisation facility would include peer workers. $20.4 million will be spent over three years to build the facility, which will operate 24-hours a day, providing acute crisis care based on a recovery model.

Peer-led alternatives to the Emergency Department, such as the extension of the Urgent Mental Health Care Centre to 24 hour operation are welcomed. The importance of community mental health services was also recognised with an $8.4 million commitment to expanding services.


This year the Queensland Government spent a record $22.2 billion on the overall health budget. Investment in health is always welcome, though we were disappointed at the lack of priority given to mental health in this year’s State Budget. Only a small proportion of the health budget was spent on mental health services, with that modest amount invested in clinical services and hospital infrastructure.

We were pleased to see the $1.9 billion to boost housing supply, as well as investment in housing for vulnerable groups, which we understand will include those experiencing mental ill health. Safe, secure, appropriate and affordable housing is critical for recovery from mental ill-health.

An Australian mental health system

I have said previously that the value of budgets for the people we support is not just measured in the amount but in where and how it is to be allocated.

Among the many positive developments in these budgets we still see a tendency to default to a piecemeal, clinically-focused, crisis-first approach. Without commitment to a more holistic system of support we will continue to be caught in a system of putting out fires without addressing their cause.

We try and treat almost every other health condition outside hospital where possible - mental health should be no different.

A limited budget need not be an obstacle to this. Small investments in new forms of in-community support to strengthen the system will pay dividends and can be expanded on in coming years.

While states vary somewhat in their individual circumstances, the Productivity Commission has made clear the urgent need for reform across Australia.

The release of the National Mental Health and Suicide Prevention Agreement in November will be an important next step in formalising the commitment of the federal and all state and territory governments to responding to the findings of the Productivity Commission and working together to give Australia the mental health system it needs.