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Experts call on Government to boost prevention spending to drive productivity gains
Leading economic and health experts have united today to urgently call on the Australian Government to boost the economy, reduce healthcare costs and improve Australians’ wellbeing by dramatically increasing and transforming spending on preventive health.
The new peer-reviewed commentary from experts at Deakin Health Economics, Cancer Council Victoria and The George Institute for Global Health has been published in the Australian and New Zealand Journal of Public Health.
The authors welcome the Australian Government’s current Productivity Commission Inquiry into “delivering care more efficiently” and support the Inquiry’s interim report that recommends a new prevention investment framework.
Lead author Associate Professor Jaithri Ananthapavan from Deakin Health Economics says Australia faces a tsunami of preventable diseases, and the cost to treat them is staggering.
“Nearly 60% of Australians already live with chronic disease, yet over one-third of this is preventable,” Associate Professor Ananthapavan says.
“As well as direct healthcare costs, these diseases cost the economy because people with chronic illness have more days off from work, have reduced productivity while at work and also leave the workforce prematurely.
“Despite strong evidence that prevention saves money and improves lives, only around 2 percent of health funding in Australia goes to prevention.”
Professor Suzanne Robinson, Director, Deakin Health Economics says the rising cost of treating diabetes is a just one example.
“We continue to spend billions managing avoidable complications rather than investing upstream in prevention and early intervention.
“Our research shows that diabetes cost the Australian healthcare system over $14 billion in 2024, with more than $7 billion in additional, preventable costs. These costs will only continue to rise unless we invest more in prevention.”
Cancer Council Victoria’s CEO Todd Harper says that healthcare spending and infrastructure like the Pharmaceutical Benefits Scheme (PBS) uses rigorous methods to ensure medicines that work and are good value for money are funded, ensuring that Australia has a world class healthcare system that is affordable to the government.
“We need a similar approach to preventing diseases such as cancer and ensure we sustain investments in good value prevention programs proven to reduce illness in our community.”
Ahead of the Productivity Commission’s final report, the Journal commentary outlines steps needed to develop a robust national prevention investment framework, including:
- Priority-setting tools to navigate competing goals to make smarter investments.
- Robust evaluation systems to track outcomes over time.
- Learn from previous efforts and other countries that have sustained long-term prevention efforts.
The Journal commentary also cautions that a new prevention funding framework should consider all types of preventive health initiatives, not merely programs and campaigns.
“Preventive health policies, like taxes on harmful products or regulations on advertising, are highly cost-effective but often face resistance from powerful industries. The new framework needs to be independent so that it can assess these opportunities in the interest of the community,” says Dr Vicki Brown from Deakin Health Economics.
Ms Victoria Le Nevez, Head of Impact and Engagement, George Institute for Global Health, says change is urgently needed.
“We know that prevention is cost-effective, but there is no agreed investment framework or clear roles and responsibilities across jurisdictions for progressing prevention initiatives.”
“Implementing the Productivity Commission’s recommended prevention investment framework will unlock the funding needed to achieve prevention’s potential,” Ms Le Nevez says.
Reflecting on the paper, Adjunct Professor Terry Slevin, CEO, Public Health Association of Australia says our current health budget is unsustainable.
“We want more Australians to live long, healthy and productive lives. Lifting investment in prevention would be good for the economy, good for communities, and good for our overstretched healthcare system. By being healthier for longer, we can make more Australian lives better, Australian families stronger and achieve more of what is important to us all. All by spending public money more wisely. Surely that should be a key government priority.”
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