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Queensland budget: Govt to levy more than $1b from big business for mental health

Queensland budget: Govt to levy more than $1b from big business for mental health

9 August, 2022

The Queensland government will follow Victoria to impose a new levy on big business to generate ongoing funding for mental health services, expected to deliver more than $1.4 billion into state coffers across the next four years.

Big retailers such as Woolworths and Coles, mining companies, and major construction firms are expected to contribute the most from their bottom lines to fund a five-year mental health spend sparked by a recent parliamentary inquiry.

The staged rollout of yet-to-be detailed mental health service beds — including for perinatal and eating disorders — 1400 new staff and capital investments through the program will form part of the state’s broader health budget, worth $23.6 billion in the coming financial year.

A recent parliamentary committee inquiry into mental health had urged the government to increase funding and expenditure for mental health and drug and alcohol services, and create a dedicated funding stream, after finding the state had the lowest national per capita spend in 2019-20.

As a result, the budget papers include a new five-year plan for the sector with $1.64 billion in operating funding and an extra $28.5 million capital spend. The committee had heard Queensland Health spent an estimated $1.48 billion on mental health, alcohol and drug services across the 2020-21 financial year.

“But in order to deliver this funding, we must have a sustainable funding model,” Treasurer Cameron Dick told parliament in his budget speech which also revealed a huge revenue windfall this year and a further planned lift to coal royalties as prices and profits soar.

To do this, the government will introduce new payroll tax levies for some businesses, which from 2023 will pay 0.25 per cent on the portion an annual taxable wage bill of more than $10 million, and an additional 0.5 per cent on the portion of those wages bills of more than $100 million.

Treasury estimates the levy would apply to about one per cent of all businesses in the state, scaling up to generate an annual $425 million by 2025-26. While Woolworths and Coles have recently reported rising sales figures, these have been partially offset by the tandem costs of inflation.

“I do not think one single person will be critical of large companies [being levied] to help people who are going through the worst of the worst from a pandemic,” Premier Annastacia Palaszczuk told reporters in the budget lock-up press conference.

Dick said legislation will ensure the amount raised is “ringfenced” for mental health purposes, and reported with any underspend to be carried over until it can be used in the sector. Budget papers state this could also include “associated services and investment”, such as dedicated housing.

Queensland Alliance for Mental Health CEO Jennifer Black commended the government for creating a dedicated funding stream, but said more needed to be done. “Lets be honest ... we’ve been underfunded against the national average for a decade,” she said.

The Victorian government announced a similar levy last year.

Palaszczuk was asked why, given the mental health committee report also suggested increased housing targets due to the effect on people’s mental health, the current strategy still would only build a portion of the properties needed to address the state’s social housing wait list.

Palaszczuk said present conditions made it hard to build homes, even if the money was there. The Queensland Council of Social Services has suggested that if the government can build hospitals as pledged, it could also build houses, with Greens MP Amy MacMahon also criticising the lack of further commitments in the sector and cost of living help for residents.

The upcoming operating budget for health and ambulance services will represent a 5.6 per cent increase from the 2021-22 financial year. Since 2015-16, the budget has grown about 55 per cent, Tuesday’s document noted. Admissions to public hospitals have grown by about 40 per cent.

In a statement, Australian Medical Association Queensland president Maria Boulton acknowledged the record spend in health, but said an increase of 5.6 per cent was only keeping up with inflation.

Opposition treasury spokesman David Janetzki suggested the levy on businesses and increased coal royalties represented a broken election promise — a claim Dick has denied.

“For seven years the Palaszczuk Government has destroyed the health system, now they’re asking for another seven years to fix it,” Janetzki said. The LNP will deliver a formal budget reply in parliament on Thursday.

The new budget will roll funds from a $2 billion hospital fund, announced last year, into its Better Health and Hospitals Plan for capacity expansion, slated to deliver 2509 additional beds into the planning pipeline.

These will come from expansions to several hospitals, most already announced, and new hospitals previously flagged in Toowoomba, Bundaberg and Coomera. The government had already announced a new $750 million cancer centre for Brisbane.