WA social services organisations say their work is on the line, with a growing gap between funding that is falling in real terms and surging demand.
The sector was delivered a slight reprieve on Tuesday when the state government announced payments under its contracts would be increased by 3.53 per cent, in light of "cost pressures".
But that fell short of the 5.1 per cent many were asking for — which would have largely covered increased wage requirements.
It leaves senior figures concerned about what the future of services looks like, as organisations start to consider where they might have to make cuts.
Evan Nunn runs Accordwest, a service in Bunbury offering support from financial counselling to housing help, and is among those facing difficult decisions.
"We will need to reassess our budgets, our forecasts, and [find] where we can save money or change the way we operate and create some sort of way through this," he said.
"We hope that we don't impact the community, but there could be chances that it impacts our service centres, the way we can reach out into the community, and also the community members themselves."
Chief executive of the WA Council of Social Service (WACOSS) Louise Giolitto described situations like that as her "biggest fear".
"This [increase] is not to cover the increasing demand that we know is out there due to the cost-of-living, housing crisis," she said.
"This is just to maintain the current services that the sector currently delivers."
And those services are being stretched increasingly thin, with cost-of-living pressures taking their toll.
Foodbank WA sees that on a daily basis, with the number of people helped by the service each day increasing from 200 a few years ago, to more than 700 on some days now.
"It has not just been as a result of us growing and providing the services to where it's needed, but very, very much from the real need in the community," Foodbank WA CEO Kate O'Hara said.
"People that are presenting to us that have never asked for help before, and now they're coming forward for the first time in their lives just to help manage a budget."
Tuesday's decision will affect two of the service's contracts, including its work providing school breakfast programs.
Ms O'Hara said the organisation would continue reviewing its costs and do its best to manage them in line with demand.
The sector is also having to grapple with higher than usual turnover rates, as burnt-out staff leave after more than two years of the COVID-19 pandemic.
"Our dedicated workforce have been going over and above what they're generally required to do," Mr Nunn said.
"Our board, our executive team and all the leaders are here to support our frontline workers, when we work with the vulnerable people we do.
"And when we don't get that support from government, that puts a lot of pressure on everybody, including I think the government itself, so I don't know whether it's an adequate outcome."
Growing wage bill hampers efforts
An added complication for the sector is that many staff will see their wages rise by between 4.65 and 5.2 per cent — a significant cost for organisations to absorb, with estimates wages account for 80 per cent of their funding.
"But they're also facing what every industry is facing — the increasing fuel prices, the increasing rental costs, increase in buying products," Ms Giolitto said.
"So like every other industry, the cost of actually delivering services is also going up."
Ms Giolitto said she had hoped to see WA follow the lead of other state governments, with the ACT indexing contracts by 4.43 per cent and Victoria increasing theirs by 4.6 per cent.
"The state government could well afford to put the indexation rate up," she said.
It was a sentiment echoed by the Shadow Treasurer, Steve Thomas.
"I don't think Mark McGowan can justify a reduction in services at the same time he's crowing about a $5.8 billion, possibly $6 billion surplus," he said.
In a statement, a state government spokesperson defended the increase, saying it would deliver an extra $48.1 million over the next four years.
"The boost will enable the sector to continue delivering a range of community services, such as support for the homeless, community health centres and youth programs," she said.
The spokesperson said the government had already spent more than $127 million in extra funding for social services over the last few years.
