Mental Health and Suicide Prevention Agreement Review

Terms of reference

I, the Hon Dr Jim Chalmers MP, Treasurer, pursuant to Parts 2 and 3 of the Productivity Commission Act 1998, hereby request that the Productivity Commission (the PC) undertake the Final Review into the National Mental Health and Suicide Prevention Agreement.

Background

Mental health is a key component of overall health and wellbeing. In any year in Australia, an estimated 1 in 5 people aged 16–85 will experience a mental disorder, and reported mental wellbeing has declined over the past decade. Poor mental health has broader impacts, as it is associated with poorer social, physical health and economic outcomes for individuals, and can impact workforce participation and productivity. Strengthening the wellbeing and capabilities of Australians is key to underpinning continued growth in Australia's productivity and living standards.

Suicide remains one of the leading causes of death for Australians, with more than 3,000 people dying by suicide every year. Suicide prevention is complex; given the range of factors that can contribute to suicidal distress. In addition to efforts to strengthen the mental health system, effective suicide prevention requires targeted approaches to ensure a range of supports are available to individuals in need.

Australian Governments are making significant investments to improve Australians' mental health and prevent suicide. During 2021–22, national recurrent spending on mental health¬and suicide prevention related services was estimated to be almost $12.2 billion. Annual average spending has increased by 3% since 2017–18 in real terms, reflecting the priority placed by Australian Governments on investing in Australians' mental wellbeing. The National Mental Health and Suicide Prevention Agreement (National Agreement) sets out the shared intention of Commonwealth, state and territory governments to work in partnership. Australian governments are collaboratively seeking to improve the mental health and reduce the incidence of suicide of all Australians.

A central component of the National Agreement is a shared commitment to transform and improve Australia's mental health and suicide prevention system (Clause 20), including to provide an effective approach to the needs of people at risk of suicide (Clause 122). The Final Review of the National Agreement will assess the objectives, outcomes, and outputs of the National Agreement and its intent to strengthen the evidence base for policy development and identify opportunities for systemic reform. The Final Review will play a key role in identifying opportunities to improve the effectiveness of this significant investment in Australia's human capital.

While the National Agreement sets out the national objectives, outcomes, and outputs for mental health and suicide prevention, individual bilateral agreements (as schedules to the National Agreement) detail the jurisdiction-specific commitments, including funding, which have been adapted to local contexts (Clause 4 and 16). Therefore, the Final Review will assess existing commitments, including those outlined in Schedule A and the bilateral schedules, which support the broader goals of the National Agreement. The Final Review will also provide valuable insights to inform the design of any future arrangements beyond June 2026, ensuring continued progress in mental health and suicide prevention efforts.

The PC is focused on improving understanding of opportunities to improve Australia's national prosperity and economic progress more broadly. Through reporting functions such as the Report on Government Services and Closing the Gap reporting, the PC plays a central role promoting improvements in public service delivery across jurisdictions and over time. The PC's 2023 5-Year Productivity Inquiry also identified that the productivity of Australia's services sector, especially non-market services, will become increasingly important to Australia's productivity going forward. Reflecting this, the Commonwealth Government identified 'Delivering quality care more efficiently' to be one of five pillars of its Productivity Agenda. Commissioning the PC to complete the Final Review of the National Mental Health and Suicide Prevention Agreement is an acknowledgement of the central importance of mental health and suicide prevention to Australia's overall wellbeing and the opportunity for evidence-based policy to support quality and productivity improvements in service delivery.

Scope of the inquiry

The PC is to conduct the Final Review of the National Mental Health and Suicide Prevention Agreement.

In undertaking the review, the PC should holistically consider, assess and make recommendations on the effectiveness and operation of these programs and services in line with the National Agreement, including, but not limited to:

1. the impact of mental health and suicide prevention programs and services delivered under the National Agreement to Australia's wellbeing and productivity
2. the effectiveness of reforms to achieve the objectives and outcomes of the National Agreement including across different communities and populations
3. the opportunities under the National Agreement to adopt best practice approaches across Australia, particularly where productivity improvements could be achieved
4. the extent to which the National Agreement enables the preparedness and effectiveness of the mental health and suicide prevention services to respond to current and emerging priorities
5. whether any unintended consequences have occurred such as cost shifting, inefficiencies or adverse consumer outcomes
6. effectiveness of the administration of the National Agreement, including the integration and implementation of Schedule A and the bilateral schedules that support its broader goals
7. effectiveness of reporting and governance arrangements for the National Agreement
8. applicability of the roles and responsibilities established in the National Agreement
9. without limiting the matters on which the PC may report, in making recommendations the PC should consider the complexity of integrating services across jurisdictions and ensuring that the voices of First Nations people and those with lived and/or living experience of mental ill-health and suicide, including families, carers and kin are heard and acted upon.

In doing so, the scope should include assessment of the integration of social and emotional wellbeing principles, and cultural safety and responsiveness for First Nations people.

The National Agreement is intended to complement other agreements, including the National Health Reform Agreement and the National Agreement on Closing the Gap, and should be examined in this context.

Process

The PC is to undertake an appropriate public consultation process including holding hearings, inviting public submissions and releasing an interim report to the public.

The PC's comprehensive and culturally appropriate consultation should include Commonwealth, state and territory government agencies, commissioning bodies, service providers, peak body organisations, people with lived and/or living experience of mental ill-health and suicide, First Nations communities, priority cohorts and other relevant stakeholders.

In undertaking the review, the PC should have regard to previous inquiries where relevant, including but not limited to the PC's inquiry into Mental Health completed in June 2020 and the final advice of the National Suicide Prevention Advisor in December 2020, as well as other work that may have explored complementary themes. The PC will also consider reports delivered through the National Agreement and Bilateral Schedules.

The PC should make recommendations for the National Agreement that aim to enhance the effectiveness, accessibility, affordability and safety of the mental health and suicide prevention system.

Deliverables

An interim report followed by a final report and recommendations should be provided to the Parties of the National Agreement by 17 October 2025.

The Hon Dr Jim Chalmers MP
Treasurer

[Received 30 January 2025]