The federal government has agreed to an eight-week extension on its National Disability Insurance Scheme (NDIS) bill, along with amendments, in exchange for Greens support for passing its tax changes. This means the sweeping overhaul of the NDIS is on hold until at least August.
The government stated this week that the delay will cost “a few hundred million dollars,” though it will not provide a more specific figure until the end of this year.
Biggest reforms since 2013
The proposed changes represent the biggest reforms to the scheme since its founding in 2013. The government says the changes will secure the scheme’s future by restraining growth to just 2% a year over the forward estimates, far less than its current rapid growth. However, critics argue the deep cuts planned will hit many disabled Australians hard, leaving thousands more isolated or with fewer services.
Minister for Disability and the NDIS, Senator Jenny McAllister, joined our podcast to discuss the government’s objectives and its chances of success from August onwards. McAllister acknowledged many “people feel protective about the NDIS.”
“We know that a change to a scheme that is as important as this will be confronting for people with disability,” McAllister said. “In part, that’s why we chose to make public our intentions back in April, well before the budget, so we could have a longer public conversation about the approach that the government wished to take. And that that conversation could involve close discussion with disability leadership across the country.”
McAllister emphasised that the government listens “really carefully when the disability community talks to us about their hopes and their fears for the future of the scheme. Our broad posture is that the reforms we’re undertaking are necessary to make sure that the scheme is here in the long term. We want the scheme to be in place for the child with disability that’s born in ten years time. Not just the child with significant disability that’s born today.”
160,000 Australians to lose NDIS access
According to the government’s own estimates, about 160,000 Australians will lose access to the NDIS by the end of the decade because of the proposed reforms. Asked what happens for those people if replacement state-based support schemes are not in place in time, McAllister said, “We don’t want to see people fall between two stools. And the prime minister [Anthony Albanese] and [Health] Minister [Mark] Butler have been very clear that will work with the states and territories to make sure that the supports are in place.”
Changes to access are not expected to be in place until January 2028. “We have time to work with the states and territories. We know it’s an ambitious timetable, but we’re determined to get on with it,” McAllister added.
The scheme was never intended to cover all people with disability. “It was always intended to meet the needs of people with permanent and significant disability. We’re taking steps, necessary steps, to just make clear who that target group is. It’s work we need to do with the disability community,” she said. McAllister noted that the government will shortly announce a technical advisory group to provide advice on the criteria for assessing permanent and significant disability, with deep consultation expected with the disability community and states and territories.
Cuts to social supports
McAllister said supporting people on the NDIS with social and community participation would continue to be “a very significant part of NDIS,” but that cuts were necessary because it had “grown very significantly in recent years.” She explained, “Just a few years ago, it was $4 billion per year. It’s now $12 billion per year, around the same size as the [Pharmaceutical Benefits Scheme]. By the end of the decade, without intervention, it’s projected to be $20 billion a year. And it’s why we’re taking the steps we are to bring that part of the NDIS budget under control.”
“Social and community participation will continue to be a feature of plans under the NDIS, even with our reforms. We’re resetting budgets back to where they were in 2023… But we do think that by choosing this area of people’s plans to focus on, to tackle runaway cost growth, we can therefore preserve some of the other supports that we know are really important to people. Supports for people with continence, with showering, with other forms of personal care, assistance in the home. Those kinds of supports are not touched by this element of the reform,” she said.
Doing more to curb fraud
On fraud in the system, McAllister defended the government’s progress, saying it “had to start from scratch” on compliance controls when it was elected in 2022. She stated, “As an example, in just one day today, the NDIA will check more claims today than the previous government was checking across an entire year. There were simply not the administrative capacities to deal with non-compliant claiming in the scheme. And we’ve had to make very significant investments in people, in systems, and in new laws to deal with that. We’ve invested something in the order of $1.35 billion since coming to government in tackling fraud and promoting integrity.”
Asked how much fraud is still in the NDIS, McAllister said, “The previous Quality and Safeguard Commissioner estimated that the rates of integrity leakage in the scheme could be as high as 20%. The current estimate from the NDIA is 8%. We’ve made progress. There is significant work still to do.”
