Ms ROSOL – You just mentioned indexation, minister. I have some questions on that because community services are vitally important and provide essential services. The indexation offered to the community sector by the Tasmanian government hasn’t kept pace with CPI for 20 years. While it’s good to see the indexation increase in this Budget with 3.5 per cent for this year and 3 per cent in following years in the forward Estimates, it doesn’t go far enough because community services have been underfunded for years. They’ve said they need approximately a 4.8 per cent uplift in indexation. I note the government’s managed to find hundreds of millions of dollars for a stadium. Why have you ignored community services, please, for the funding they need to provide their vital services?
Mr JAENSCH – Thank you for the question, Ms Rosol. We haven’t ignored the sector. We’ve heard them loud and clear that they want certainty and that they want to see that there is growth built into their their funding over time. We’ve provided certainty by announcing proper compounding indexation of payments with a four‑year outlook, which they can plan around and plan for within their business. It’s set above Treasury’s forecast CPI curve for Tasmania. It is in line with public sector wages across the same period, as well as benchmarks to guide the level that we’ve struck. In total the value of the indexation alone over the next four years will be nearly $26 million to the sector in growth.
There is a number of factors that drive costs for the cost of doing business for community sector organisations. Some of them will be shared across the sector, some will affect different types of organisations differently, depending on their size, their staffing structures and those sorts of things. We will continue to have a discussion with the sector about the sustainability of their funding and their resources, just as we have had a conversation with them over the last few years around their workforce and development. As a continuing investment in our sector development plan, we’ll work with TasCOSS and their member organisations to ensure that we’re addressing these sorts of issues. In the meantime we’re providing certainty that they never had before, and $26 million additional funding over the next four years.
Ms ROSOL – I guess the community organisations are still saying that that’s not enough for them to keep providing the services they need to. They’re saying that they’ve had to cut back on programs and that the indexation that’s being provided won’t be enough for them to continue to provide things. If they’re looking at cutting services, what services are you suggesting that they cut? What’s acceptable for them to cut, if they’re not getting the funding they need to provide the services?
Mr JAENSCH – I’m not suggesting that anyone cut services. Where we have organisations that have received short and fixed term grant funding within the last couple of years, the expectation for those would be that the cost of delivering the services were factored into those agreements at the beginning. For those organisations that have longer term agreements, the indexation and some of the additional payments that have been made over recent years have aimed to meet those additional costs, or growth in costs, of delivering the services.
Where we want to get to next is with longer‑term funding agreements that are based on outcomes – one of the reasons for doing that is we don’t lock in one way of doing things in a fixed contract with a line item by line item itemised budget that we’ve funded, that people need to report and acquit against. The focus will be on delivering an outcome and freeing those organisations up to find the best way to do it, to use their resources efficiently and well, to partner, to innovate. That’s another way of ensuring efficient use of funds as well. It will reduce the administrative burden of managing short‑term contracts with lots of reporting and acquittals processes. We believe we can save further percentage points on costs of doing business, improve outcomes, and keep talking with the sector and with individual organisations about their needs to continue operating and delivering the services that we’re purchasing from them.
