Astonishingly enough, it turns out that, if your strategies for saving money are inhumane and uncaring, you’ll just end up making things more difficult, more painful, and more expensive for everyone.
In this particular case, spending a little less now to help people with mental health problems means we have to spend a lot more later when those mental health problems become more serious.
(See also needle exchange programmes, which demonstrably reduce harm caused by compulsive drug use in a remarkably cost-effective way, but which have an iffy history of interaction with government at best, and are rejected by many politicians on some kind of moral “principle”, regardless of how much they help.)
I guess there’s no inviolable natural law as to why, in theory, governments mightn’t be capable of rising above this kind of short-termism, and responding to a troubled economy by taking actions that would actually save money rather than making everyone’s lives worse. But it’s not how things often seem to work in practice.