McGowan Government delivers $30m boost to community services

The McGowan Government has shown its ongoing commitment to supporting the community services sector by reversing indexation changes made by the Liberal National Government, which had left organisations supporting our most vulnerable citizens out of pocket.

The previous government changed the NGHSS Indexation Policy to be based entirely on CPI, which reduced funding to the sector.

Community services sector organisations provide essential services and care to our most vulnerable Western Australians including individuals facing homelessness, family and domestic violence, mental health issues and more.

The not-for-profit community services sector has advocated for funding to better reflect wage costs and this change represents the Government’s recognition of the labour intensive nature of community services.

From July 1, 2019, the NGHSS indexation rate will return to its original formula being a blended rate of the Wage Price Index, with an 80 per cent weighting, and the Perth Consumer Price Index (CPI), with a 20 per cent weighting. This policy change will ensure not-for-profit organisations’ contract payments are indexed to better reflect cost increases in the delivery of community services.

All new and continuing not-for-profit community service contracts will increase by 1.47 per cent instead of a 1.16 per cent increase under the previous government’s policy. This change represents an increase of approximately $30.2 million in sector funding over the next four years.

Further details of the updated NGHSS Indexation Policy is available on the Department of Finance’s website.

“The former Liberal National Government’s changes were miserable. They failed to recognise that many community sector organisations are labour intensive, so it is only right we recognise wage costs,” said┬áCommunity Services Minister Simone McGurk.

“By increasing the indexation rate, the Government offers a fairer and more sustainable approach to the sector and will support the ongoing delivery of services to our most vulnerable citizens.

“Many of the organisations in the sector asked the McGowan Government to reverse this harsh indexation policy and we have listened.”

Finance Minister Ben Wyatt said, “The indexation policy of the previous Liberal National Government actually reduced funding to the community services sector, which made it impossible to maintain their level of services.

“The McGowan Government’s ongoing work get the Budget back into surplus means we can balance strong financial management with the need to support those organisations supporting the most vulnerable in our community.

“These are the sort of rewards for financial management which have an immediate benefit for those in the community who need it most.”