The NSW Budget for 2023-24 has left a critical void in funding for the state's mental health sector, as expressed by a coalition of organisations representing mental health consumers, caregivers, and professionals.

Organisations supporting this statement include, Australian College of Mental Health Nurses, Australian Medical Association (NSW), BEING – Mental Health Consumers, Black Dog Institute, Mental Health Carers NSW, and Royal Australian College of General Practitioners.

While the coalition applauds the allocations aimed at addressing social determinants of mental health, such as investments in housing, disaster recovery, education, and healthcare, new funding for mental health services is conspicuously absent.

Samuel Harvey, Executive Director and Chief Scientist at the Black Dog Institute, laments the current state of mental health services in NSW, where capacities are stretched thin, frontline workers are experiencing burnout, and individuals seeking mental health care face extended wait times and increased out-of-pocket costs. He states, "People who need mental health care now have to wait longer and pay more out of pocket to get the help they need."

CEOs from member organisations of this coalition had previously warned of the impending crisis in the NSW mental health system ahead of the state's election. Since taking office, individual members have continued to advocate for increased mental health funding with Health Minister Ryan Park and Mental Health Minister Rose Jackson.

Priscilla Brice, CEO of BEING – Mental Health Consumers, the peak body for mental health consumers in NSW, emphasises the Minns Government's missed opportunity in its first budget to support over 1.3 million people in NSW grappling with mental health challenges. Urgent reform is called for, with Priscilla Brice noting, "The longer reform takes, the more people will fall through the cracks, and the more costly it will be."

NSW currently ranks lowest in per capita investment in mental health services among all Australian States and Territories and is the only state where mental health spending per capita has decreased in the past decade.

Matt Ireland, Acting President of the Australian College of Mental Health Nurses, criticises the lack of funding in this initial Labor budget as a missed chance to address a growing issue. He warns, "When new funding is made available, the extent of the problem will be that much greater due to the lack of attention in this first Labor budget."

Despite mental health accounting for 13 percent of NSW's total number of diseases, funding for mental health services constitutes just seven percent of the state's total health budget. This inadequacy has persisted since the launch of 'Living Well,' the 'Strategic Plan for Mental Health,' developed by the NSW Mental Health Commission almost a decade ago.

Demand for mental health services has risen year on year, both before and after the Covid pandemic. Since 2003, the proportion of the NSW population experiencing high to very high psychological distress has surged from 10 percent to 17 percent, representing over 570,000 additional individuals in need of mental health care in NSW, with diminishing funding per person to address it.

The coalition of mental health organisations issued a set of urgent requests to the government:

1. Conduct an independent gap analysis of state-funded mental health services in NSW to identify funding and workforce gaps, including providing a clear view of service demand and role vacancies in the state.
2. Allocate funding for mental health proportionate to the burden of disease, with annual funding increases based on projected population growth and anticipated demand.
3. Develop a recurring revenue stream to provide dedicated ongoing funding for mental health services, potentially implementing a Mental Health Payroll Tax Surcharge for companies with total Australian wages exceeding $100 million, akin to initiatives in Victoria and Queensland.