State Government funding for community service delivery is disproportionately low, according to a new independent survey commissioned by the Western Australian Council of Social Service (WACOSS).
The 2024 Sustainable Funding Survey Report, which was undertaken earlier this year in partnership with peak bodies and analysed by UWA’s Centre for Public Value, showed underfunding was the primary reported challenge to sustainability for community service organisations.
This, consequently, has severe adverse impacts on the ongoing provision of vital services and supports to people most in need in our communities. This flows through to workforce failure, chronic under-investment and very real threats to organisational survival.
The scale of this underfunding is most severe in regional areas where organisations operate, with additional costs putting current contracts and operations in jeopardy.
The survey found that the current indexation formula is out-dated, with 74 per cent of respondents in favour of adopting a new formula that better reflects factors such as mandated superannuation guarantee increases and non-discretionary expenditure inflation.
It also highlighted that 93 per cent of organisations have not observed any material improvement to contracting arrangements since the implementation of the WA State Commissioning Strategy.
At a time when there is a persistent dual cost of living and rental crisis, it is no secret that more Western Australians are doing it tougher than ever. The community services sector needs adequate baseline funding so people are able to access services when and where they need it.
The current State Government indexation policy does not incorporate award increases. The evidence shows that this has been a compounding issue over the past 10 years. Our calculations demonstrate the sector has been up to 14 per cent underfunded to cover award conditions.
We acknowledge and are extremely supportive of the recently announced uplift of $70.2 million to homelessness funding and would like to see that carried across all community services.
WACOSS and Community Employers WA (CEWA) will continue to advocate for a more appropriate methodology that keeps pace with award conditions and inflation.
WACOSS Chief Executive Officer Louise Giolitto said underfunding is affecting more in this time of crisis.
“We know that more Western Australians are doing it tougher than ever before. Unfortunately, those Western Australians are the ones who suffer the most when indexation policy does not keep pace with the award,” she said.
“We acknowledge and applaud the recently announced uplift to baseline homelessness funding and look forward to that being applied across all community services so those who need to can access critical and life-saving support when and where they need it.”
CEWA Executive Director Tim Grey-Smith said many organisations were filling the gap for the State Government.
“Organisations have been forced to cut staffing and reduce operating due to indexation not keeping pace with wage cost increases. Some staff are choosing to do unpaid overtime to keep services running, things simply can’t continue like they are,” he said.
“The current indexation policy effectively short-changes charities year on year. We look forward to the State Government taking a common-sense approach and resolving this issue once and for all in Thursday’s state budget.”
UWA Centre for Public Value Director Professor David Gilchrist, who co-authored the 2024 Sustainable Funding Survey Report, said that the evidence was clear that it is now time for government to address the systemic issue.
“Band aids have been stuck onto band aids for decades and the reality is the people of Western Australia are shouldering the impact of endemic, long term underfunding of community services,” Professor Gilchrist said.
