Report: Queensland’s Cost Indexation for Government Purchasing of Human Services
Queensland community services funding sustainability relies on the terms under which services are procured (for example, length and value of contracts), injections of funding when significant policy changes or disruptions occur, and indexation.
Indexation is applied to community services funding in acknowledgement that the costs of delivering services will change over time. Currently, indexation is calculated by reference to wage price index (WPI) and the consumer price index (CPI).
The costs of delivering community services are increasing. Costs related to labour, audit, accounting and marketing have all seen significant increases. As these expenses are not discretionary, they must be met in order to continue to deliver essential frontline services to our communities.
This recent report, published by QCOSS, demonstrates that the current method of calculating indexation is not fit for purpose for the community services sector in Queensland. The method used does not correspond to the costs incurred by community services and continues to result in inadequate levels of indexation being applied to funding.
The creation of a sector specific indexation rate was a key recommendation in the report, and one that would appropriately reflect real community serivce organisations’ operations and costs. A briefing paper accompanying the report outlined a recommended indexation rate of 5.82% in the Queensland state budget for 2023-24.
This important report is the result of the collective efforts of the Queensland Network of Alcohol and Other Drug Agencies (QNADA), Queensland Alliance for Mental Health (QAMH), Volunteering Queensland (VQ), PeakCare, Financial Counsellors Association of Queensland (FCAQ), Community Legal Centres Queensland, The Centre for Women & Co., Queensland Meals on Wheels and Queensland Council of Social Service (QCOSS).
Access the accompanying briefing paper on indexation for this year’s Queensland Budget.