Australia is failing more than 130,000 people with significant psychosocial disability – despite spending billions every year on the NDIS.
This gap is fuelling a growing problem. People without adequate supports are more likely to experience homelessness, be hospitalized, or have their needs escalate, putting pressure on systems that are already under strain.
In this podcast, Sam Bennett, Mia Jessurun, and Reilly Polaschek, discuss the latest Grattan report, Bridging the Gap: Meeting the needs of Australians with psychosocial disability. In the report, they outline a plan to build a fairer and more effective system of psychosocial supports.
Transcript
Kat Clay: Many Australians living with psychosocial disability do not get the support they need. The NDIS funds nearly $6 billion in services for more than 60,000 people with psychosocial disability every year, but another 130,000 adults with the highest needs receive no psychosocial supports, not from the NDIS and not from the mental health system.
This gap is fuelling a growing problem. People without adequate supports are more likely to experience homelessness, be hospitalized, or have their needs escalate, putting pressure on systems that are already under strain. Our new report, Bridging the Gap: Meeting the needs of Australians with psychosocial disability outlines a plan to build a fairer and more effective system of psychosocial supports. One that ensures people can get help, whether they’re in the NDIS or not.
I’m Kat Clay and with me today are the report authors, Sam Bennett, Mia Jessurun, and Reilly Polaschek.
Before we start, I do want to acknowledge that each of us comes to these issues with different experiences of disability and mental health. A lot of us have lived experience or are familiar with the experiences of our family and friends when we talk about these things. Discussions about reform here for us are, are never abstract. They are about real people, their support systems and their lives. So, our goal in this conversation today and in this report is to offer practical evidence-based solutions that will create a fairer system for people with psychosocial disability.
Reilly, let’s start with you. You’ve drawn our attention to the huge service gap facing many Australians with psychosocial disability, but not all of our listeners will actually know what this term means. To start us off, can you explain what a psychosocial disability is and what it can mean for people in their day-to-day lives?
Reilly Polaschek: The term really isn’t very well understood. There’s no internationally agreed definition for psychosocial disability, and it is used relatively distinctively in Australia, largely due to its inclusion in the NDIS. When we talk about psychosocial disability, we are talking about the disability that can arise from impairments resulting from serious mental health challenges. An example of this is that a person might experience the mental health condition of schizophrenia. This could impair their ability to emotionally regulate, which can cause difficulty in forming and maintaining friendships and relationships in their lives. That’s just one example, though. There are many types of impairments that can result from mental health challenges, and these can make daily life really difficult.
Beyond the challenges of managing their mental health, many people with psychosocial disability face barriers to learning, working, connecting, and belonging as a result of their mental health challenges. But there are supports that we know can make a big difference, which are called psychosocial supports. Psychosocial supports are different from clinical supports. They’re services that help people to live a meaningful life in the community regardless of whether they continue to experience symptoms of their mental health conditions. This could involve programs to help build social connections, learn the skills to manage daily life, or maintain stable housing. There’s strong evidence behind psychosocial supports that we’ve really looked into, in the process of writing this report. Access to these supports can reduce the likelihood of someone needing to be hospitalized for their mental health or having contact with the justice system. Our concern in the report really is that most people in Australia who need these supports aren’t getting them.
Kat Clay: So, Mia, your report shows that while the majority of adults with psychosocial disability miss out on support, some are getting something. Can you tell us more about what the landscape of supports looks like for people with significant psychosocial disability?
Mia Jessurun: So, most people who do need supports miss out at the moment. Some people do get support from either the NDIS or a small number of continuing state and territory or federal government programs. So, we estimate this is about 220,000 Australians with significant psychosocial disability in Australia. 130,000 get nothing but those who do get support mostly get it from the NDIS. People on the NDIS get quite a lot of support. The average package size is about $70,000 per year if you exclude people with the most intensive housing and support packages, but less and less people with psychosocial disability are being found eligible for the NDIS each year. Last year, only about one in four people who applied for the NDIS with a primary psychosocial disability were successful. And while the NDIS has a really important role for the people with the most significant needs, it shouldn’t be the only option. Outside of the NDS, there’s a patchwork of small state and territory programs and some federal programs, which currently only support about 35,000 people each year. And the support available varies greatly between states.
Kat Clay: So, Mia, can you give us some examples of those state-based supports that are happening in Australia?
Mia Jessurun: So, in New South Wales, a relatively small portion of people get support, but those who do get quite a lot, mostly through the community Living Supports housing accommodation support initiative, which provides on average nearly 350 hours per year per person. So quite intensive support often involves a focus on helping people maintain their tenancy. On the flip side, we look at Queensland, which is a state where a relatively high portion of people get quite low intensity supports. A lot of that is through these kinds of individual and group recovery support programs, which are much lower intensity.
The average person getting support with a significant psychosocial disability in Queensland gets only about 30 hours per year on average, and it tends to be that kind of individual or group recovery programs that they might be attending. So, the difference between those two states is almost tenfold. Someone in Queensland gets something similar to about an hour per fortnight on average. Versus in New South Wales where it’s about an hour per day. I guess we would argue that access to support should really be determined by your needs and preferences, not by where you live. And across the board we see a really huge amount of unmet need, so something really needs to change.
Kat Clay: Yeah, I mean, group support programs are fantastic, but the 30 hours a year doesn’t seem like enough to provide the support that some people might need. Given the size of the gap in services and supports, it’s kind of natural to ask, how did we get to this point?
Sam Bennett: Look, it’s fair to say it’s a pretty longstanding problem we’ve identified in this report. Things have actually never been great in this space. There were gaps in support that existed before the NDIS and while the NDIS has really significantly increased the funding that’s available, um, it hasn’t substantially increased access.
In fact, we know there are some people that got support from pre-NDIS psychosocial programs that didn’t then go on to be found eligible for the NDIS. The Productivity commission in its 2020 Mental Health Inquiry did quantify the size of this gap, but we haven’t seen a lot of progress in the intervening period in, in closing it.
Similarly, there’s been some pretty long running critique of how well the NDIS is set up to support people living with significant mental health challenges. There’s a, a lack of specialization in working with people with psychosocial disability that’s been identified by previous reviews of the scheme. A concern that it has a, a generic design that’s not well suited to their needs, um, and concerns as well that the funding model doesn’t help people get access to things that we know would work best. So, the last review, the independent review of the NDIS that was conducted in the first term of the Albanese government concluded current NDIS funding priorities for this group are inconsistent with the evidence about the most effective supports. So, we know the current NDIS funding for this group isn’t being spent as well as it could be.
So there’s a lot of issues here that are well known and part of the problem as we see it in why we haven’t succeeded in changing that so far, is that supports for this group sit at this slightly uneasy intersection between two different policy areas of mental health on the one hand, and disability on the others. And the gap’s been acknowledged by both of those. But we haven’t seen any clear responsibility for psychosocial supports outside the NDIS allocated to either level of government, and that’s led to inertia and confusion. And no significant progress really to show for the last two years in particular. And we think the Department of Health, Disability and Aging really needs to lead the way here by joining up separate policy making in these areas. And clarifying that this work is sort of one and the same. So, work that’s been progressed to address unmet need under the National Mental Health and Suicide Prevention Agreement and work that’s been progressed since the National Cabinet Agreement to establish foundational supports outside the NDIS really need to be, progressed as a, as a single piece of work.
Kat Clay: So, Sam, what recommendations do you have that will address this very stark disparity for Australians with psychosocial disability?
Sam Bennett: We’ve taken a really close look at this Kat, and we make four key recommendations for how government can actually shift the needle on this problem and address this really concerning service gap for Australians with psychosocial disability. The first is to establish a new national psychosocial disability program outside the NDIS, which we are saying should have a focus on providing these much needed supports for those 130,000 adults with the most significant psychosocial disability that Mia was talking about previously.
To our reading that’s the most significant gap. It’s an area where there’s the biggest service sort of gap in the current system. And we think this program can be established through better allocation of existing spending rather than requiring new money. So, there’s no need for governments to get bogged down in further funding negotiations next year they can make some timely progress.
Second, we want to see the program deliver a number of services consistently across the country. Um, We looked at a lot of the evidence base from current and pre NDIS programs, and we think that points to the particularly high value that can be placed on some services and interventions, and that ensuring consistent and equitable access to those across the country should be a real priority.
But we also want to see that balanced with appropriate tailoring to meet local needs and preferences where those are legitimately different.
Thirdly, we want to align incentives for government by making federal, state, and territory governments jointly responsible for program funding and design with clear responsibilities.
It’ll be really important that this new program interfaces sensibly and coherently with both the NDIS, and predominantly state run clinical mental health services, and that won’t be achieved by either level of government going it alone. And finally, we think primary health networks, an existing commissioning vehicle in Australian communities, including for community mental health services, should be responsible for planning and commissioning the program. As part of consortia that would bring together the best knowledge and expertise in designing and delivering these kinds of supports, including a really strong voice for people with lived experience of significant mental health challenges, their carers and families, the regional knowledge and expertise, existing commissioning infrastructure and the national reach that the PHNs have make them the right choice we think, for delivering this program.
Kat Clay: So, it really is bridging that gap between disability supports and the clinical system. Reilly, at the heart of your recommendations is this new program. Do you want to tell us a little bit more about how that would work and what it would offer people who use it?
Reilly Polaschek: At the centre of our report is our recommendation that governments need to establish a program to provide psychosocial supports to people with psychosocial disability that sits outside of the NDIS. We call this the National Psychosocial Disability Program. The program is intended to build up a greater continuum of support for people with significant psychosocial disability addressing the current funding cliff that exists where you either get NDIS support, or in most instances, you get nothing. We think no matter where you live in Australia, you should be able to access supports if you have a significant psychosocial disability.
Importantly, we don’t see this program as being a replacement for the NDIS for people with psychosocial disability. Um, we see a very important ongoing role for the NDIS. We see this program is sitting next to the NDIS. People should be able to step up and down between the programs, um, as they kind of needs evolve based on whichever stage they’re at in their mental health journey. Within the MPDP, we think that there are three main types of services that should be available wherever you live in Australia.
The first is a support facilitator. This is a person who you can build a one-on-one relationship with who will understand your needs, help you to set goals, and connect you with the right supports. It’s similar to a navigator type of role that often gets recommended in this space, but it’s really more than just connecting with other services. It’s a support in and of itself.
The second type of service in the program is more regionally tailored, psychosocial supports. There’s no point having a support facilitator if there are no supports that they can connect you with. And as we’ve noted in our report, there really isn’t enough today. Our program allocates a flexible pool of funding to each region for more evidence-based supports to be commissioned that meet the local needs of each community.
The final type of service in the program is social and emotional wellbeing supports, which would be delivered in community by community.
We think it’s really important to acknowledge the distinct cultural needs of First Nations people with psychosocial disability. Establishing the NPDP to sit alongside the NDIS will ensure that no matter where you live in Australia, people with significant psychosocial disability can receive the supports that they need.
Kat Clay: One of the big questions we always ask at Grattan is how much does it cost? How does the funding solution work here? Because you say that it doesn’t require any additional government spending. How can we expand psychosocial supports for 130,000 people without increasing the overall budget?
Mia Jessurun: That’s possible because our analysis shows that it’s not the amount of money in the system that’s the problem at the moment. It’s how it’s distributed. And so, we outlined a plan in our previous report, saving the NDIS, which we build on in this report to rebalance funding to make sure it’s more equitably distributed across all people with a psychosocial disability in Australia. We know that within that NDIS budget most spending is on daily living support, these supports aren’t what evidence shows support long-term recovery for people living with psychosocial disability, which is the stated goal of the NDIS for this group. We know that they have a really important role for some people, particularly in a kind of time limited way when people first join the scheme or during periods of more acute unwellness, but they shouldn’t constitute the kind of bulk of what people receive in the long term. There’s an opportunity to slowly rebalance some of that funding from the NDIS to fund this National Psychosocial Disability Program outside of the NDIS. We know that’ll be a challenging transition, but we think it’s really important to achieve an equitable outcome. By the end of our transition in 2030-31, we’re talking about using around a quarter of the total funding that’s projected to be spent on people with psychosocial disability in the NDIS to fund this new program.
Kat Clay: Stepping back, Sam, why do you think this is the best option for governments to fix the gap? And if these reforms were implemented, what would the future look like for people with psychosocial disability and for the NDIS?
Sam Bennett: I talked about the lack of progress we’ve seen in this area over multiple years and some of the reasons for that, but it warrants repeating that as people are listening to this podcast today, it’ll be more than two years since governments committed, through national cabinet to jointly design and commission foundational supports, including to build up a comprehensive system of psychosocial supports of the kind that we’re talking about.
And we know that hasn’t happened. Uh, and that hasn’t happened as a consequence of overlapping responsibilities, contested roles, uh, and also fiscal constraints. Our proposal addresses each of those issues. It clarifies the shared responsibility of governments in closing this gap, but with a clear role for the commonwealth. Through primary health networks in addressing the currently unjustifiable inconsistency and inequity we see in service offerings across the country that’s definitely the best vehicle in our view to ensure that there’s fairer access to support, regardless of your postcode or your NDIS eligibility status. It uses the opportunity that exists with disability and mental health now within the same federal government department to join up these policy areas and get these systems working better together. Allocating clear accountability to health and mental health ministers under the National Mental Health and Suicide Prevention Agreement.
But with the right connections into disability reform, it identifies a clear priority for government. Which for us is to meet the needs of adults with the most significant psychosocial disability. ‘Cause that will transform the lives of a group of people and families that are chronically underserved at the moment. But it will also prevent escalations in crises that reduce pressure on hospitals, uh, on other mental health services, on the justice system too. And that will strengthen the sustainability of the NDIS. By ensuring that it’s there to support the people with the highest needs, um, but with other services in place outside the scheme, which will help prevent, reduce, or delay people’s need for that higher level of support in the future. And it provides a funding solution too. Um, That’s more of an equitable distribution of government’s current investment in the NDIS. So, the billions of dollars committed over the forward budget estimates go further to support many more people with psychosocial disability. And we think in the current fiscal environment solutions that depend on governments finding billions of dollars of new money are unlikely to get off the ground.
We also think that funding a broader range of supports under that NDIS budget will ensure both levels of government have got this vested interest in those programs working well together and in balance. Governments are failing people with psychosocial disability at the moment. The current system is highly inequitable. It’s unsustainable too. An urgent response is needed. And we think our proposal gives governments something they can act on now without the need for work to be delayed in a quagmire of new funding negotiations in 2026.
Kat Clay: Thank you so much, Sam, Mia, and Reilly. If you’d like to read this report, you can read it for free on our website at grattan.edu.au, and I’ll put a link to the report in the show notes as well. Grattan Institute is a not-for-profit organization, and we rely on donations from our lovely listeners like you. To keep producing these kinds of reports and our work into the future, please donate this year at Grattan.edu.au/donate. As always, please do take care, and thanks so much for listening.