Final Report on RREF 2001 - Department of Health

Part A: Background and Scope of the RREF Review
There are however no reliable data on handicap by age group at the LGA level. Unlike the
Census, the Disability, Ageing and Carers Survey is based on a sample of the population. The
sample is selected in proportion to each state’s population and so provides reliable estimates of
the prevalence of handicap in each state by age group. The sample is however too small to be
used to provide separate estimates of age-specific prevalence for each LGA. The present RREF
gets around this problem by applying the single set of statewide rates of handicap to the age
structure in each LGA. As the figures in Figure 2 show, there is a very strong relationship
between age and rates of handicap.
This method assumes that there is no variation in age-specific rates of handicap between LGAs.
In reality, some LGAs may have higher or lower rates of handicap for reasons other than age
structure, but the current RREF cannot take these variations into account.
It is also recognised that there is some variation in age-specific prevalence of handicap for
different population groups. In particular, the higher age-specific rates of handicap in the
indigenous population are taken into account in some programs, but not in the current RREF.
The formula for the Commonwealth State Disability Agreement, for example, gives double
weight to the Koori population in each state as the program provides double funding per capita
for this population.
Frail aged
An adjustment for the frail aged is made in the current RREF by including the total population
aged 85 and over who are living in the community, that is, not only those with moderate, severe
or profound activities.
Rural Weighting
The only weighting in the current RREF is for rurality. The rural weighting takes account of the
dispersion of the target population; the more dispersed the population, the higher the weighting.
The rural weighting is calculated by dividing the number of people in the HACC target
population in the LGA by the area of the LGA (in square kilometres). If the density is:
above 10 target population persons per sq. km, no weighting is applied;
between 5 – 10 target population persons per sq. km, the weighting is 10%;
between 2 – 5 target population persons per sq. km, the weighting is 20%; and
less than 2 persons target population persons per sq. km, the weighting is 30%.
Thus rural LGAs with the lowest population densities are treated as though their Target
Population were 30 % greater. They therefore attract a higher share of growth funds.
The current rural weighting was determined by the RREF Steering Committee in 1992.
Additional costs associated with service delivery in rural areas was the only factor supported by
all the interest groups consulted, and a measure of the density of the target population was
adopted. Two points about the way in which the rural weighting was decided warrant comment:
The Steering Committee noted that it was unable to find empirical data to support the selection
of the 10%, 20% and 30%, but indicated that given the extent of support for recognition of this
factor, there was justification for including the “relatively nominal” percentages. The
weightings are however far higher than the rural weightings included in any of the formulas that
have been developed subsequently.
<strong>Final</strong> <strong>Report</strong> July 2001 11