Final Report on RREF 2001 - Department of Health

Options for revising the RREF do not result in dramatic shifts in resources between regions
because the differences are relatively minor. There are greater differences between Local
Government Areas in regions than between regions. Participants in both rounds of
Consultations pointed out that such gradual changes would achieve only limited progress
towards overall regional equity and that underlying inequities in base funding would persist
unless further action was taken.
As adoption of any revised RREF would redraw the equity line, it was argued that the equity
component needs to be adjusted accordingly. Once a decision is made on a revised RREF, it
will be possible to identify the scale of the equity component required and the time frame over
which equity in regional shares of HACC funding could be realised, taking account of available
resources. It should be stressed that, as with past equity adjustments, funds for this purpose
would be set aside before the amount of growth funds to be allocated through the RREF was
determined and would not affect the absolute amount of base funding that regions continued to
receive or the shares of growth funds allocated through the RREF.
In considering the relationship between annual HACC growth funds and existing base funds
received by regions, it needs to be emphasised that there is only a limited nexus between the
share of base funds and the share of growth funds that any region receives. The share of growth
funds is projected forward for the coming year by the RREF, independently of the pre-existing
share of base funding that any region receives which reflects historical trends and the
incorporation of growth funds over many years. Rather than growth funds following the
existing shares of base funding, it is the RREF that leads the determination of equitable shares
of growth funding and base funding.
There was support for action to address inequities in HACC base funding as part of the
implementation strategy for any revised RREF. Continuing to identify an annual equity
adjustment would provide the means of bringing base funding into line with equity as defined
by the a revised RREF. The scale of adjustment required would be indicated by the different
between the shares of base funding and the equitable shares defined by the revised RREF, as for
growth funds.
Future review and on-going development of the RREF
Options for future review and on-going development of the RREF were identified at two levels.
First, new data for updating the data used in the RREF will become available from three sources
in the next two years:
1. The next national census is to be held in August 2001. As well as
providing new data for updating of the base populations for the RREF
with new DOI projections developed after the census, the census will
enable updating and refinement of the four need variables that use
census data, namely median household income, cultural diversity, the
Koori population and the ARIA. Updating will take account of the
combined effect of different rates of population growth between LGAs,
associated changes in age structures, and changing characteristics of
local populations.
2. Implementation of the HACC Minimum Data Set will generate a
considerable amount of relevant data at LGA level over the next 12
months. These data will be especially useful for comparing estimates
of the size and characteristics of local HACC target populations based
on the DAC Survey with clients using services.
<strong>Final</strong> <strong>Report</strong> July 2001 86