The former government led by Malcolm Turnbull awarded a $33m grant to a company that was developing a mental health app after months of lobbying from one of its own mental health commissioners who was also a shareholder in the months-old startup.
The one-off grant was awarded in 2017 without a competitive tender to Innowell for a series of collaborative research trials into a digital mental health platform. Its shareholders include PwC, the University of Sydney and former mental health commissioner Prof Ian Hickie.
While there is no suggestion of wrongdoing by Hickie, the university or PwC, transparency and mental health advocates are concerned about the closed process and argue an open and competitive tender for the $33m investment would have ensured value for money. Hickie told Guardian Australia: “My perceived conflicts and my specific shareholdings have been disclosed in all relevant public reports and places.”
Some advocates have also questioned the independence of the studies examining the efficiency of Innowell’s platform – although the company defends the evaluations.
Despite repeated questions from Guardian Australia, neither the federal health department nor Innowell have provided a breakdown of how the money was used.
Hickie, PwC and Innowell’s chief executive have all described the platform as a success that has delivered a return for taxpayers, but the federal health minister and senators are calling for more information about the grant.
The pathway to funding
In June 2017, the federal health department formally awarded the money to Innowell – whose scientific adviser is Hickie – for a series of trials into a digital mental health platform. Innowell was registered as a proprietary company limited by shares in February 2017 and, according to Asic documents, Hickie registered shares in April.
In May 2017, weeks before the funding was secured and during negotiations, PwC and the University of Sydney – where Hickie is a co-director at the Brain and Mind Centre – both registered 45% shareholdings. The split of shares was collectively agreed to by all parties.
Hickie told Guardian Australia his 5% equity share was determined by company directors and reflected his role as one of “the intellectual leads of the whole process”. He said he received no income from the company beyond his shareholding, which had since been reduced to 3.2%. Another researcher, Prof Jane Burns, also received a 5% equity share.
The one-off grant followed extensive lobbying by Hickie to then-prime minister Turnbull for further investments in digital mental health innovations. Hickie at the time held a government-appointed position as a national mental health commissioner.
In an opinion piece in the Daily Telegraph in September 2015, Hickie wrote: “If prime minister Turnbull seriously wants to show that he is focused on 21st-century solutions, one of his first actions could be to … invest in new technologies linked to new smart systems and expert clinical and technical teams.”
(July 25, 2014)
The federal government awards $5.5m to Project Synergy after a competitive application process. The collaborative project researches digital mental health services.
(September 14, 2015)
Malcolm Turnbull replaces Tony Abbott as leader of the Liberal party and becomes prime minister.
(September 23, 2015)
Then national mental health commissioner and co-director of the Brain and Mind Centre at the University of Sydney, Prof Ian Hickie, writes an opinion piece for the Daily Telegraph urging Turnbull to invest in digital mental health services.
(May 24, 2016)
Turnbull faces questions about mental health on the campaign trail before the federal election and phones Hickie to offer personal commitment to reduce suicide “backed by smart technology”, the Sydney Morning Herald and HuffPost report.
(June 26, 2016)
While on the campaign trail, Turnbull promises $30m “to trial new digital technologies to ensure access to mental health services wherever and whenever needed 24/7”.
(June 27, 2016)
Hickie applauds the $30m for “a world-leading suicide prevention system”.
(July 20, 2016)
The Coalition wins the federal election.
(November 17, 2016)
PwC declares financial donations worth $155,605 to federal and state Liberal parties. Overall political donations are $232,619.
(February 7, 2017)
Innowell is registered as a proprietary company limited by shares to lead the next stage of Project Synergy. The founding directors include Kristin Stubbins, a PwC partner and the firm’s future acting chief executive, and former ministers Alan Griffin (Labor) and Michael Ronaldson (Liberal).
(February 10, 2017)
All Innowell partners agree on a shareholding structure, signed by the delegated authority.
(April 18, 2017)
Hickie’s 5% shareholding is registered with Asic.
(May 16, 2017)
PwC’s 45% shareholding is registered with Asic.
(May 16, 2017)
The University of Sydney’s 45% shareholding is registered with Asic.
(June 30, 2017)
The federal health department enters a formal funding agreement with Innowell for the next stage of collaborative research trials known as Project Synergy. The agreement is for $33m allocated over the next three financial years, and the funding is allocated following a non-competitive, closed grant process.
(July 25, 2017)
The government gives a total of $33m in funding to Innowell Pty Ltd to develop and research the Innowell platform.
(June 25, 2021)
The federal government allocates a portion of $111m in digital services funding in the 2021-22 budget towards transforming the government’s existing Head to Health website into a more comprehensive national mental health platform. It decides not to adopt the Innowell platform in any of its health services, or to further invest in it.
At the time, Hickie was involved in an initiative called Project Synergy, which brought experts together to develop a digital mental health platform, administered by the Young and Well Cooperative Research Centre. That project received $5.5m in government funding through a competitive process from 2014 to 2016.
When the funding expired, the research centre was “wound up” and the intellectual property from Project Synergy was transferred to the University of Sydney for further development, Hickie said.
Election promises
Mental health was a key issue during the 2016 election campaign. After it was raised in a press conference, Turnbull called Hickie to personally assure him of his commitment to reducing suicide “backed by smart technology”. Weeks later, Turnbull pledged $30m to trial new digital mental health technologies.
After the July poll – won by the incumbent Coalition government – those involved in Project Synergy discussed the creation of a new company, Innowell, which would administer federal funds and bid for other government grants. Asic documents show its founding directors were former Liberal minister Michael Ronaldson, former Labor minister Alan Griffin and then-PwC partner Kristin Stubbins. There is no suggestion of wrongdoing by Griffin, Ronaldson or Stubbins.
The shareholdings of Hickie, who was still advising the government on mental health policy, and PwC, which had lucrative contracts with the government and was a major political donor, did not change the Coalition’s decision to award the money through a closed and non-competitive process.
Turnbull was contacted by Guardian Australia but did not comment on the record.
Hickie said: “The Turnbull government expectation was that the $30m was a one-off grant to establish a for-profit entity with capacity to compete commercially in Australia and internationally – and that the company would not be dependent on further national government investments for its ongoing operations.”
When asked by Guardian Australia if there should have been an open application for the $33m, Hickie pointed to the earlier $5.5m competitive grant and work already conducted by his team at the University of Sydney.
“Are you really suggesting that the third phase could or should have then gone out competitively?” Hickie said in a statement.
“Who could have competed to develop a platform that was already well into its own development, where the IP was already held by the University of Sydney, and had formed its own relevant private partnerships to facilitate its own pathway to commercialisation?”
The importance of transparency
The federal health minister, Mark Butler, has asked the department for a brief on the funding allocation after the department was unable to answer questions from Guardian Australia about why the decision was taken to allocate $33m through a closed process, or to provide a breakdown of how the funding was spent.
A health department spokesperson would only say “it was a decision of the government at the time”.
Transparency International Australia’s chief executive, Clancy Moore, has raised concerns about the one-off grant. He told Guardian Australia that Department of Finance guidelines advised governments to promote “open, transparent and equitable access to grants and to identify possible risks in grant programs”.
“The decision to award a one-off closed grant to a for-profit entity, which the then-national mental health commissioner, a position appointed by the government, had shares in does raise obvious conflicts of interests and a clear risk in the awarding of the grant,” Moore said.
“Unfortunately, this $30m grant is another example of how personal friendships, politics and networks can influence public policy and the use of valuable public money.”
Hickie dismissed this concern, stating that his role as national mental health commissioner was well known and he advocated for many mental health initiatives.
“My perceived conflicts and my specific shareholdings have been disclosed in all relevant public reports and places,” Hickie said.
Greens senator Barbara Pocock, who is leading a Senate inquiry into consultants along with Labor’s Deborah O’Neill, also has serious concerns about the grant.
“I’d say there would be many suppliers in that market who would have jumped at the chance to bid for a contract such as this, so the question is, why weren’t they given that opportunity?”
Questions about taxpayer value for money
Hickie, PwC, and Innowell’s chief executive, Syed Ahmed, have all described Project Synergy as a success that has delivered a return for taxpayers. But the platform is not without its critics.
The federal health department said the platform received a mixed response from practitioners, with many perceiving it as an administrative burden.
An evaluation of the project led by Prof Ilan Katz from the Social Policy Research Centre at UNSW Sydney, prepared and funded by Innowell in 2020 and released under FOI, raised concerns about its usefulness.
“In terms of [mental health] consumers, the evaluation was not provided with sufficient data to draw any conclusions about the value to their treatment and their outcomes,” the evaluation found.
The evaluation also found “the [Innowell] platform has had a mixed response, particularly by practitioners, many of whom have, at least initially, perceived it as adding another administrative burden to their work”.
Hickie said the fact the Abbott and Turnbull governments had invested in the digital technology was a demonstration of its success.
“The success in securing contracts internationally would also be seen by others as a most welcome return on investment,” he said.
Ahmed said the company was selling its product worldwide “with very clear and tangible results in improving the delivery of mental healthcare”.
“Since commencing commercialisation in 2021, the platform has well over 100,000 users,” he said. “While it is still in early stages of growth, revenues are expected to total above $50m over the next three years.”
Issues are raised with the department of health
Concerns about the efficacy of Innowell were also directly communicated with the federal health department. A document sent to the department by a mental health researcher in August 2022, seen by Guardian Australia, outlined concerns about a lack of independent and rigorous research informing Innowell’s development.
It cites concerns that many consultations with target groups such as veterans and young people with mental health issues involved small sample sizes and too few people with lived experience. Those with lived experience who did participate expressed concerns around the privacy of their data, while some people living with eating disorders were concerned that tracking and ongoing assessment through the Innowell platform could be problematic as “scores could engage perfectionism”.
“These teams have a legitimate interest in developing faster and more efficient mental health services, which we share as a community,” the document states.
“Where we diverge is the lack of transparency and accountability for funds that are now sequestered in a commercial entity. The work to date has little academic or scientific credibility. A monopolised, commercialised control model has little place when trying to manage a diverse population with deep, complex health needs.”
Asked about these concerns, Ahmed said: “There were a number of processes in place to inform the co-design of the platform, with a wide variety of views from everyone involved. Input from those with lived experience was, and remains, a key part of the platform’s framework.”
Hickie said that “much work on privacy, legally and from a consumer perspective, has been done” as part of the project. He said he believed the concerns raised in the document were part of “a campaign to protect the current primary mental health roles held by Australian general practitioners”.
He said access to mental health services was “government-financed, doctor-controlled, and monopolised, since GPs are the only source of referral to other government-subsidised psychological services”.
He said he believed the aim of the document was “to ensure that the Albanese government does not support” any reforms that would disrupt this GP-led model, “including the increasing digitisation of healthcare generally, and mental healthcare specifically”.
“Clearly, by attacking me personally at this time, and seeking to discredit the rigour of our independently assessed and peer-reviewed academic outputs, their goal is to stall genuine reform of these key aspects of health care reform,” Hickie said.
“The much more interesting story is why digital transformation has been so slow, particularly post-Turnbull.”
The Innowell platform was built and trialled across a number of New South Wales mental health services, with the Project Synergy trial concluding in June 2021 and a final report submitted to the federal health department the following month.
The federal and NSW health departments have confirmed there has been no further use of or investment in the Innowell platform by the governments.
• In Australia, support is available at Beyond Blue on 1300 22 4636, Lifeline on 13 11 14, and at MensLine on 1300 789 978. In the UK, the charity Mind is available on 0300 123 3393 and Childline on 0800 1111. In the US, Mental Health America is available on 800-273-8255
