An unprecedented $1.2 billion investment toward out-of-home care (OOHC) and child protection services in NSW’s 2025-26 state budget was cause for more hope in the Aboriginal and Torres Strait Islander caregiving sector, when it was announced last week.
However, details below the fold point to a disappointingly short-term mindset, and hesitance to take action toward the systemic transformation needed for meaningful change—offering little more than lip service to a ‘reformed OOHC program’.
Instead, the NSW Government outlined its plan outlines intent to spend large sums patching up the most egregious and visible problems in its existing, fundamentally-flawed system; as well as coughing up a long-overdue renumeration lift and recruitment drive for the state’s chronically undervalued casework and foster care workforce.
Despite its own admission that there is “a substantial and persistent overrepresentation of Aboriginal children in the OOHC system,” the Government’s plan is light on detail for action to addressing this increasing inequality.
AbSec CEO, John Leha said:
“The billion-dollar figure is good for headlines, and it is great news for carers and caseworkers who deserve recognition and reward for their work.
“However, investing money into the out-of-home-care (OOHC) system will not fulfil promises of the real reform needed to close the gap and address the vast overrepresentation of Aboriginal and Torres Strait Islander children and young people caught in a broken system,” said Mr Leha.
“At AbSec, we advocate for Aboriginal and Torres Strait Islander children and young people to remain safe and together with their families,” said Mr Leha.
“We need significantly expanded early intervention and holistic family support delivered by Aboriginal community-controlled organisations (ACCOs), and, for those Aboriginal and Torres Strait Islander children and young people currently in OOHC, that responsibility shifts to ACCOs that will support them in care delivered by Aboriginal and Torres Strait Islander family members and carers.“
While the OOHC announcement dominated budget coverage, the budgets’ inclusions of an additional $202.4 million investement toward Closing the Gap; and a $484.9 million slice set aside for Aboriginal housing* and early childcare, are positive signs for Aboriginal and Torres Strait Islanders in NSW.
What’s left of the $1.2 billion pie?
With $797 million (roughly 80 percent) of the overall package earmarked for OOHC service provision, the remaining balance is set to be spread between three other areas.
- $191.5 million to recruit and retain caseworkers with higher pay and more specialised training.
Since 2020, DCJ has held funding for 2,333 fulltime caseworker roles across the state. However, recruitment and retention has been an ongoing problem—209 caseworker roles went unfilled last year. It’s not only the government workforce that needs increased capacity; ACCOs are also in need of more caseworkers—especially as more and more organisations gain trust and traction with local communities.
- $143.9 million to increase the foster carer allowance by 20 per cent.
Carer recruitment has been a significant challenge in recent years, and a driver of alternative care arrangements and high-cost emergency accommodation. AbSec views this as a big win for the sector, having consistently advocated for increases to the carer allowance.
- $49.2 million for 44 government-owned and operated residential care homes.
Residential care is by far the most expensive type of OOHC placement, accounting for about 2 per cent of placements, but 20 per cent of OOHC spending. DCJ aims to deliver these new residential care homes cheaply with existing government-owned housing stock. It remains to be seen if the Government’s desire to reduce costs leads to reduced quality of life for children and families requiring residential care.
