The Australian Productivity Commission has recognised mental health as a key driver of economic participation and productivity in its inquiry report.

The Commission is the Australian government’s independent research and advisory body on economic, social and environmental issues affecting the welfare of Australians.

This is a rigorous and comprehensive report, covering population mental health throughout the life course.

Australian Productivity Commission mental health inquiry report

Protective factors for mental health

The review highlights important protective factors for mental health including:

  • youth economic participation
  • mentally healthy workplaces
  • income and employment support for people who experience mental health conditions.

Re-orientating healthcare

The Commission recognises the particularly strong links between employment and mental health and the considerable scope to reduce the barriers to employment faced by people with mental health issues and increase their workforce participation.

“The lost opportunities for people with mental illness* to work productively and fruitfully creates economic costs for the person, family and community. These costs are particularly high because the effects of mental illness fall mainly on people during their working lives, as opposed to other health conditions that on average affect older people.”

IPS a priority reform

As a priority, the report states that:

  • all governments should act to extend the IPS model of employment support through a large scale rollout to community mental health services (Action 19.4)
  • the expansion of IPS programmes is likely to provide significant economic benefits and that’s why it should be prioritised for prompt implementation.

“As a priority reform for people with mental illness, individual placement and support (IPS) programs [sic] … should be rolled out on a staged basis for all job seekers with mental illness, allowing for the incorporation of lessons learned at each stage, across Australia. Approximately 40,000 people with mental illness are estimated to potentially benefit from participation in IPS. The expenditure to implement IPS is estimated to be lower than the substantial healthcare cost savings, a reduction in costs associated with Disability Employment Services, and some additional employment income”.

Three aspects favour the IPS approach for expansion

The report continues, “Aside from its strong evidence base, three aspects favour the IPS approach. There is good evidence of efficacy, the nature of the intervention has been very clearly defined so that governments know what to implement with some precision and the target group for the intervention is established.”

The Commission outlines how to address the questions around delivery, funding and implementation, noting that the lack of widespread formation of new IPS partnerships post-2018 suggests that more active policy settings are needed to drive expansion of the model.

The Commission recommends a cooperative funding model, potentially through a national partnership, and provides examples of ways to encourage whole of government policy.

“Coordinated action is required by health and employment Ministers to co-locate employment and mental health support as part of expanding access to IPS programs [sic]. As access improves and participation increases, this would have positive benefits for mental health.”

All volumes of the report, supporting materials and fact sheets are available for download on the Productivity Commission website.

* The Productivity Commission report uses the term “mental illness” to refer to people in contact with secondary mental health and addiction services. Work Counts uses the term “mental health conditions”.

Source: Productivity Commission, Mental Health, Inquiry Report.