The Economy, Stupid The price of mental illness
Jan 15, 2026
Steve Robson, a health economist and former head of the Australian Medical Association, and Jenny Gordon, an economist at the Australian National University, delve into the costly cracks in Australia's mental health system. They discuss the complexities of mental health treatment, emphasizing the need for social supports like housing to reduce illness. The duo highlights why mental health often takes a backseat in productivity agendas, and they call for integrated early intervention strategies, especially for disadvantaged communities and children.
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Big Benefits, Low Political Salience
- The Productivity Commission estimated large economic costs and large net benefits from reforms, yet mental health has low political traction.
- Jenny Gordon links the issue's invisibility to it not fitting short-term productivity agendas.
Economics Struggles With Mental Health Complexity
- Economists avoid mental health because it's complex, individual-specific and lacks clear low-hanging policy wins.
- Jenny Gordon says limited data and unclear policy levers make cost-benefit reasoning difficult.
Provide Practical Community Supports First
- Prioritise non-medical supports (housing, safety, transport, income) for people with severe mental illness.
- Steve Robson urges investment in practical community supports alongside psychiatric care.