New research shows mental health supports provided in the community (psychosocial supports) deliver value and significant cost savings, but Australia has barely scratched the surface of measuring their true economic worth.
Today researchers from the Centre for Social Impact at the University of Western Australia (CSI UWA), will present their report to South Australia’s Minister for Health and Wellbeing Hon Blair Boyer with the economic evidence behind non-clinical, community-based programs that help people experiencing mental distress build the housing, employment, relationships and daily living experiences.
In total, mental health challenges cost Australia approximately $255-280 billion per year. This research highlights the substantial burden of mental distress on the Australian economy, but points to strong benefits where psychosocial programs have been evaluated, including significant reductions in hospital and emergency presentations, and meaningful gains in people’s quality of life.
When people are able to access psychosocial supports there are strong results in terms of mental health outcomes, improved quality of life and economic outcomes. These programs returned people to the workforce, and diverted them away from clinical care, leading to cost offsets and reduced demand for crisis support.
Their report also notes “economists have joined the diversity of voices that are questioning the dominance of clinical interventions within the mental health system and advocating for the role of psychosocial supports.” When delivered in the community, often by peer workers, psychosocial supports are less expensive than specialist clinical interventions. Supporting people to stay well, in several dimensions of their life, means they will have less demand for acute care, or for crisis responses, making this approach very cost effective.
The economic benefits estimated by the Productivity Commission that arise from an increase in people’s quality of life were valued at up to $18 billion annually ($23 billion in March 2026 dollars).
Quotes attributed to Geoff Harris, Executive Director, Mental Health Coalition of SA:
We have known for a long time that psychosocial support is good value, and worth backing. Now we have economic evaluations which also show the results are strong.
Psychosocial support programs deliver genuine improvements in people’s quality of life alongside real cost offsets. These programs return people to the workforce, or divert them away from expensive hospital and clinical care. The opportunity now is to build on this evidence. There is enormous scope to strengthen the case even further, and to give funders and policymakers the confidence to invest with certainty.
The research also points to considerable unmet need for psychosocial support nationally, and notes that spending on psychosocial support remains a small fraction of overall mental health expenditure, with clinical services continuing to dominate the system.
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Read the report:
https://apo.org.au/node/334964
https://www.csi.edu.au/research/capturing-the-economic-value-of-psychosocial-support/
About us:
The Mental Health Coalition of South Australia is the peak body representing non-government community mental health services in South Australia. The MHCSA brings together member organisations that deliver psychosocial services to thousands of South Australians living with severe and complex mental illness.
