NSW government criticised for hidden $120m funding cut to critical mental health program

Furious mental health advocates have hit out at the NSW Government for gutting a program that helps some of the health system’s most vulnerable patients.

Tuesday’s announcement of $111.8 million in pre-budget funding included a four-year funding commitment of $40 million for the Pathways to Community Living Initiative (PCLI).

But that was well short of the $160 million over four years the program was originally billed for in December 2021.

The revised amount means that instead of the planned 230 places the program could support, the initiative, which helps long-term mental health patients with complex problems, will now only be able to cater for 20.

Providers currently negotiating with the government were stunned by an email from NSW Health on Tuesday confirming the cuts, with the department saying it would now undertake a detailed planning process to reduce the scope and cost of the scheme.

The Black Dog Institute’s head of government relations, Lawrence Muskitta, said it was “horrendous” that the government would end the program “at a time like now, when the need is so great”.

“Independent evaluations of this program have shown that it reduces hospital admissions and interactions with the police. It helps people stay healthy and live in the community,” he said.

“It’s often very difficult for people who have very severe mental health problems and long-term mental health problems to stay in stable housing and stay in treatment, so this program could really prevent so many people in the community from going to hospital or to prison.”

Mental Health Coordinating Council chief executive Evelyne Tadros accused the government of “watering down the programme”, which would end up costing it more money.

“Not only is it a human rights issue, it also costs more to keep patients in hospital care instead of living in the community with choice and autonomy,” said Dr. Tadros.

NSW Mental Health Minister Rose Jackson said Tuesday’s $40 million in PCLI funding was new funding that would allow the program to continue.

It is understood that the $160 million originally tendered required additional contracts with providers to allow the program to serve all 230 customers, but talks have not been successful.

“This investment will pay for the ongoing provision of 25 staff in the NSW mental health system dedicated to working with people with persistent mental illness and complex needs,” she said.

“Without it, these workers are currently employed but face a funding problem.”

But Ms Jackson said “more needs to be done”.

“This is an important investment and a springboard from which we can continue to build,” she said.

“I am committed to continuing to work with experts in the field on long-term interventions.”

The funding cuts coincided with the conclusion of a parliamentary inquiry into access to mental health care, which described the current NSW landscape as “chronically and severely under-resourced”.

The final report also called for immediate and “significant” reform to close the access gap, including more funding for clinics, health workers and services.

Committee chair and Greens health spokeswoman Amanda Cohn said the funding cut was “an insult to all the people who gave up their time and energy to contribute to the inquiry”.

“The cuts to PCLI are of particular concern, the inquiry recommended that funding be increased for supported living programmes, including PCLI, and the funding announced today is less than previously promised.”

Prime Minister Chris Minns said on Tuesday he still had to review the report and its 39 recommendations.

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