The Commonwealth will put $727 million over three years into its Drug and Alcohol Program from 2026-27, and $244.2 million a year from 2029-30. The money was locked in at the December mid-year budget update. What providers still do not have is a contract past 30 June 2027.

The sequence explains why. The Department of Health, Disability and Ageing commissioned an evaluation of the program in 2025, which found stakeholders valued it but that reform was needed to demonstrate outcomes and improve efficiency. The government then consolidated the program's terminating and ongoing funding into a single ongoing allocation, and extended every current grant due to expire in June 2026 by one year.

The next round of three-year agreements starts on 1 July 2027. Between now and then the department is designing the grant opportunity that will decide who holds them, working through a consultation that ran in three stages from February. Services currently delivering treatment will have to apply for the work they are already doing.

That is a year of certainty followed by a competitive process, for a sector in which the asset is a residential bed and a clinician who has to be employed continuously to keep it staffed.

Gerard Byrne, who chairs the Australasian Therapeutic Communities Association, told SBS News the arrangement was "a house of cards", where the loss of one funding stream puts the others at risk. The association's executive officer, Michelle Ridley, said there was "significant uncertainty about future funding for the sector" and that some services "undoubtedly face very hard decisions about their future admissions". The association represents providers who would be bidding in that process, and has an interest in the answer.

The scale of what is being tendered is documented. The Australian Institute of Health and Welfare counted about 127,800 clients receiving 244,400 treatment episodes in 2024-25, delivered through 1,316 publicly funded agencies. On the department's own design, the core of the new program is money routed through Primary Health Networks, which commission services locally rather than the department contracting providers directly.

That structure matters as much as the total. A Primary Health Network is a regional commissioning body, so the department is no longer the party deciding which residential service in which town continues. It also puts a step between the minister who announces the funding and the decision to stop paying for a particular service.

Byrne's argument is that untreated addiction does not leave the public ledger, it moves. People who cannot get a detox bed turn up in emergency departments, police cells and courtrooms, all of which are funded on longer horizons than the treatment that would have come first.

The department has not published the grant opportunity guidelines. Until it does, providers are staffing beds against a contract that ends in ten months.

The National Alcohol and Other Drug Hotline is 1800 250 015.