The national Report on Government Services 2012 shows more funds going into services for people with disability while administrative costs fall.
The Australian Institute of Health and Welfare report shows total government spending rose from $131.4 million in 2009-2010 to $148.8 million in 2010‑2011, an increase of $17.4 million.
At the same time, administrative outlay in Tasmania fell from 4.7 per cent in 2009-10 to 4.6 per cent in 2010-11, well below the 7.6 per cent national average.
Tasmania also had the second highest level for use of community access services at 9.3 per cent of the population compared to 7.3 per cent nationally.
The report also highlighted progress in responding to housing needs and homelessness.
In 2010-2011, 96.2 per cent of new allocations for public housing were to households in greatest need, which is the highest result of any state or territory.
On homelessness, Tasmania had the highest proportion of clients moving to independent accommodation after support and the second highest proportion of clients with only one support period.