Is headspace making a difference to young people’s lives?

Appendix B
Current centre funding model
Key messages
• Current headspace grant funding is relatively inflexible. While flexibility may be gained
from consortia partners, this information was not available to the evaluators. Part One
has further information on this issue.
• Consideration should be given to matching grant funding to relevant factors such as
youth demand, population catchment size, rural location and service profile of centres.
• headspace administrative data (hCSA) record the source of funds used for any given
occasion of service, but crucially does not record the cost of that occasion of service.
Given that two-thirds of occasions of service are funded out of a combination of MBS
and other non-headspace grant funds, this is a major shortcoming. Recording cost
would provide further insight into the funding model and greatly improve the quality of
any future evaluation.
• Where possible, non-government funding data should be included in future evaluations
of the headspace model. As the headspace service model is designed to leverage off
funding sources in addition to the headspace grant, a lack of information about these
funds within headspace administrative reporting represents an information blind-spot
for the Department and a significant data-gap for the evaluation.
Rationale
The current funding model for headspace centres impacts on the nature and extent of service delivery
via headspace centres by placing a cap on individual centre resources. While additional funds may be
provided by consortia partners, this information is not available to evaluators and therefore cannot be
considered in the analysis. In assessing the current model of centre allocation, some consideration
needs to be given to the funding model.
Information relating to the centre-funding model was provided by hNO and DoH over the life of the
project. Final audited centre-level expense (hCFA) data were provided to the evaluators in January
2015. The discussion which follows concentrates on the broad funding model.
Results
For the purposes of this evaluation, the evaluation team applied an indicative annual running cost
based on 2013/14 headspace centre funding agreements. This places an average value of $842,000
per annum of centre funding per centre, as allocated by headspace hNO. We have also included
hNO centre administration costs of $96,000 per centre per annum. The funds allocated to each fully
operational centre in 2013/14 by hNO ranged from $600,000 to $1,100,000.
In addition, there is a separate establishment funding provided by hNO to support the new centres in
their first year of operation. This funding amounts to an additional $350,000 (for fit-out) plus $450,000
(for part-year services) to assist with centre establishment in the first year only. As the Round 7 and 8
allocated centres are in various stages of roll-out, and are yet to achieve full functionality, they will be
subject to this additional establishment funding rather than the average running cost of $842,000 per
annum.
The headspace centre funding model allocates at least 75% of funding to staff costs, and 25% to
indirect costs. Compliance with this cost structure by each centre is monitored by hNO. The grant
expenditure is targeted at community engagement, infrastructure costs, centre manager salary,
administrative costs, and intake workers. The system has built-in quality controls so that as data is
entered at the centre-level, expenses which fall outside agreed parameters are highlighted for query
by hNO finance. There is, however, some capacity for flexibility in unusual circumstances.
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headspace Evaluation Final Report
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