BILLS DIGEST NO. 4, 2020–21              10 August 2020

National Disability Insurance Scheme Amendment (Strengthening Banning Orders) Bill 2020

Kaushik Ramesh
Law and Bills Digest Section 

Date introduced: 12 June 2020

House:  House of Representatives

Portfolio: National Disability Insurance Scheme

Commencement: The day after the Act receives Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the Federal Register of Legislation website.

All hyperlinks in this Bills Digest are correct as at August 2020.

Purpose of the Bill

The purpose of the National Disability Insurance Scheme Amendment (Strengthening Banning Orders) Bill 2020 (the Bill) is to amend the National Disability Insurance Scheme Act 2013 (the NDIS Act) to broaden the circumstances in which the National Disability Insurance Scheme Quality and Safeguards Commissioner (the Commissioner) can make a banning order against a provider or person who provides services to people with disability.

Background

The National Disability Insurance Scheme

The National Disability Insurance Scheme (NDIS) provides support to people with disability, their families and carers. The NDIS represents an insurance-based approach predicated on the premise that people with disability have different support needs and should be able to exercise choice. The NDIS replaced the previous block funding system with a fee-for-service market based system and is jointly funded by the Australian, and state and territory governments. The NDIS commenced on 1 July 2013.[1]

The Commissioner and banning orders

On 2 September 2016, the majority of members of the Council of Australian Governments Disability Reform Council agreed to a national Quality and Safeguarding Framework for the NDIS.[2] The National Disability Insurance Scheme Amendment (Quality and Safeguards Commission and Other Measures) Act 2017 established the NDIS Quality and Safeguards Commission and Commissioner in order to have functions in relation to:

•       registration and regulation of NDIS providers, including Practice Standards and a Code of Conduct

•       compliance monitoring, investigation and enforcement action

•       responding to complaints and reportable incidents including abuse and neglect of a person with disability

•       national policy setting for the screening of workers

•       national oversight and policy in relation to behaviour support and monitoring restrictive practices within the NDIS and

•       information sharing arrangements.[3]

Specifically, this amendment Act provided the Commissioner with the power to make banning orders prohibiting or restricting activities by NDIS providers and persons engaged or employed by NDIS providers.[4] The Bill proposes to broaden (or strengthen) the scope of these banning orders. The current requirements with respect to banning orders as well as how the Bill amends these requirements is discussed in the ‘Key issues and provisions’ section below.

Strengthening banning orders

In 2019, David Tune conducted a review into the NDIS Act which examined participants’ experiences of the NDIS and opportunities for improvement of the scheme. The review also focussed on the Government’s commitment to legislate a ‘Participant Service Guarantee’ that is intended to set standards and timeframes for decision making as it affects NDIS participants, their families and carers.[5]

The Minister’s second reading speech accompanying the Bill notes that legislative amendments for strengthening banning orders were first raised in the context of this review and were intended to be introduced as part of a proposed National Disability Insurance Scheme Amendment (Participant Services Guarantee and Full Scheme) Bill 2020.[6] The Review report does not appear to discuss the prospect of broadening banning orders under the NDIS Act specifically.

The measures in this Bill to strengthen banning orders made by the Commissioner appear to have been brought forward ahead of the broader package of reforms in part due to the recent death of Ann Marie Smith in South Australia. Ms Smith, who relied on a carer for her needs, reportedly died of severe septic shock, multi-organ failure, severe pressure sores, malnutrition and issues connected with her cerebral palsy. Ms Smith had been registered for six hours of care a day through the NDIS. Police have alleged that she had suffered extreme neglect.[7] A South Australian parliamentary inquiry heard that Ms Smith’s carer had been previously been banned from providing services by a state government agency.[8]

The Minister for the National Disability Insurance Scheme, Stuart Robert, noted in his second reading speech that the recent circumstances surrounding the death of Ms Smith highlighted the importance of having the strongest possible protections for NDIS participants. The Minister noted that, while broader NDIS Participant Service Guarantee reforms have been delayed due to the COVID-19 pandemic, the Government believes the Bill’s measures are important enough to be brought forward in a separate Bill.[9]

Committee consideration

On 18 June 2020, the Senate Selection of Bills Committee deferred consideration of the Bill until its next meeting.[10] The Bill has been considered by the Senate Standing Committee for the Scrutiny of Bills (Scrutiny of Bills Committee)[11] and the Parliamentary Joint Committee on Human Rights (Human Rights Committee).[12] These Committees’ comments on the Bill are discussed in the ‘Key issues and provisions’ section below.

Policy position of non-government parties/independents

At the time of writing, the policy position of non-government parties and independents on the Bill was not apparent.

Position of major interest groups

The advocacy group, People with Disability Australia (PWDA) is reportedly supportive of the measures proposed by the Bill, but has noted that it is only a ‘first step’ in protecting people with disability.[13] El Gibbs, Direction of Media and Communications for PWDA reportedly stated:

We’re pleased to see the first step towards improving the safeguards for people with disability that use the NDIS. The recent death of Ann-Marie Smith, and other abuse of people with disability, have exposed the many gaps that exist in the current system.

…

The next step needs to be ensuring that the NDIS Quality and Safeguards Commission has the powers and resources to proactively investigate and conduct random spot-checks on disability support providers.[14]

Similarly, Aged and Disability Advocacy Australia (ADA Australia) is reportedly supportive of the Bill, but has noted that the effectiveness of the regime will be dependent on how banning orders are determined.[15] The Chief Executive Officer of ADA Australia, Geoff Rowe, reportedly stated:

I think giving the Commission a way to ban a provider or to ban an individual is not a bad thing and the question comes back to what is the metric that will be used [to ban].

One of my concerns, if you look at the criminal history screening. ADA Australia provides aged care and advocacy services, and we do see people who are sacked from one sector, and then they turn up in the other because they have been sacked.

The devil is in the detail, how they determine who should be banned, what consultation will they have with people with disability and the sector about where the threshold should be.[16]

The CEO of ADA Australia also reportedly expressed a view that there is merit in broadening the scope of the Commissioner’s powers so that all people with disability are protected, not just those covered by the NDIS.[17]

Financial implications

The Government has noted that there are no significant financial impacts of this Bill.[18]

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.[19] Further discussion on the human rights aspects of the Bill as noted by the Human Rights Committee is set out in the ‘Key issues and provisions’ section below.

Key issues and provisions

Current situation with respect to banning orders[20]

Section 73ZN of the NDIS Act sets out the current powers and requirements relating to banning orders. Under subsection 73ZN(1) of the NDIS Act, the Commissioner may, by written notice, make an order (known as a banning order) prohibiting or restricting specified activities by an NDIS provider if:

•       the Commissioner has revoked the registration of the person as a registered NDIS provider

•       the Commissioner reasonably believes that:

–      the person has contravened, is contravening, or is likely to contravene the NDIS Act

–      the person has been involved in, or is likely to become involved in, a contravention by another person

–      the person is not suitable to provide supports or services to people with disability or

–      there is an immediate danger to the health, safety or wellbeing of a person with disability if the person continues to be an NDIS provider

•       the person is convicted of an offence involving fraud or dishonesty or

•       the person becomes an insolvent under administration.

The Commissioner may also make a written banning order prohibiting or restricting a person who is employed or otherwise engaged by an NDIS provider from engaging in specified activities if the Commissioner reasonably believes that:

•       the person has contravened, is contravening, or is likely to contravene the NDIS Act

•       has been involved in, or is likely to become involved in, a contravention by another person

•       the person is not suitable to provide supports or services to people with disability or

•       there is an immediate danger to the health, safety or wellbeing of a person with disability if the person continues to be an NDIS provider.

Such a banning order may also be made if the person is convicted of an offence involving fraud or dishonesty, or becomes an insolvent under administration.[21]

A person who engages in conduct which breaches a banning order incurs a maximum civil penalty of 1,000 penalty units for an individual or 5,000 penalty units for a body corporate.[22] The NDIS Act also empowers the Commissioner to vary the terms of, or revoke, a banning order.[23] The Commissioner may only make a banning order against a person after giving the person an opportunity to make submissions to the Commissioner on the matter.[24] However, the NDIS Act provides an exception to this general rule if the Commissioner’s grounds for making the banning order are, or include, that there is an immediate danger to the health, safety or wellbeing of a person with disability; or that the Commissioner has revoked the registration of the person as a registered NDIS provider.[25]

Broadening the narrow scope of banning orders in relation to persons

As highlighted above, banning orders made with respect to persons who are not NDIS providers are limited to persons who are ‘employed or otherwise engaged by NDIS providers’ and are used to prevent them from engaging in specified activities in certain circumstances.

This effectively means that a worker needs to be actively engaged by a NDIS provider when a banning order is issued. A banning order cannot be issued when a worker is no longer engaged by a provider or is yet to be engaged by a provider. As noted in the second reading speech accompanying the Bill, under the current legislation it is unclear whether a banning order remains in force if a worker subsequently leaves the employment of a provider.[26] It is the Bill’s purpose to broaden the current narrow scope of banning orders, which the Government views as problematic. This is highlighted by the Minister’s second reading speech:

… under the current legislation, the Commissioner can only apply these provisions when the worker is engaged by a provider that is delivering services under the NDIS.

This means if a worker's engagement ends, such as if a worker is sacked because of the issue under consideration, the NDIS Commissioner cannot issue a banning order to the worker.

Similarly, under current legislation it is unclear, even if a banning order is applied before a worker's engagement ends or the provider they work for leaves the NDIS, that the order stays in force.

Further, the Commissioner cannot currently issue a banning order to a person who is not yet involved in the delivery of NDIS services but is unsuitable to be involved in delivering them based on their known record in another similar sector such as aged care or child care. That is, a person who could have effectively been banned from one of these other sectors for reasons relevant to the delivery of NDIS services but the commissioner cannot ban such a person until they start to deliver services under the NDIS.

In short, this bill will strengthen the current banning provisions of the NDIS Act 2013 and address these concerns.[27]

Key provisions

Item 2 of Schedule 1 amends subsection 73ZN(2) of the NDIS Act so that the current power to issue banning orders for persons employed or engaged by an NDIS provider extends to persons who were previously employed or engaged by an NDIS provider (but may have subsequently ceased this relationship).

Item 3 inserts proposed subsection 73ZN(2A) into the NDIS Act, which will allow the Commissioner to issue banning orders in respect of individuals who have not been an NDIS provider and who have not been employed or engaged by an NDIS provider. Such a banning order can be issued prohibiting the person from being involved in the provision of specified supports or specified services to people with disability if the Commissioner reasonably believes that the person is not suitable to be involved.

Item 4 inserts proposed subsection 73ZN(5A) so that a banning order made under subsection 73ZN(2) in respect of a person currently engaged or employed by a NDIS provider is not affected by the employment or engagement subsequently ceasing.

Committee comment

The Scrutiny of Bills Committee notes that while proposed subsection 73ZN(2A) gives the Commissioner a broad discretionary power to ban persons from providing disability services, there is limited guidance on the face of the Bill as to how this power will be practically exercised. The Committee also notes that there is no definition as to when a person will not be suitable and no guiding criteria regarding assessing suitability.[28] As a result, the Scrutiny of Bills Committee requested advice from the Minister on the following:

•       why it is necessary and appropriate to provide the Commissioner with a broad power to ban persons from providing disability services and

•       whether the Bill can be amended to include additional guidance on the exercise of the power on the face of the primary legislation.[29]

NDIS Provider Register

The Commissioner is required to establish and maintain a NDIS Provider Register, which is to be kept in any form that the Commissioner considers appropriate.[30] Requirements in relation to the NDIS Provider Register are governed by Division 9 of Part 3A of the NDIS Act. The NDIS Provider Register is publicly accessible on the NDIS Quality and Safeguards Commission website.[31]

The Bill amends the NDIS Act so that certain information on persons against whom a banning order has been made will be included on the NDIS Provider Register to assist people with a disability and their carers to make informed choices about a suitable NDIS provider.

Key provisions

Item 5 inserts proposed subsection 73ZS(5A) which will provide that the NDIS Provider Register may include any of the following information in relation to a person against whom a banning order has been made under subsection 73ZN(2) or subsection 73ZN(2A) of the NDIS Act:

•       the person’s name

•       the person’s Australian Business Number (if any)

•       information about the banning order and

•       any other matter prescribed by the NDIS Rules.[32]

The Government has noted that it does not intend the matters which may be included in the Register prescribed by the NDIS Rules to include highly sensitive or highly personal information about the person subject to the banning order.[33] However, the Government has noted:

… in some instances, such as where an individual or business has a common name, it may be necessary to include further information, to publish an amount of information that is sufficient to ensure people with disability and their carers can identify the person. This would not extend, for example, to the nature of the incident that prompted the making of the banning order. It may include, for example, a broad description of the town or area in which the banned person was providing services.[34]

Despite its stated intentions, there is no certainty as to the content of any future matter that may be determined by the Government to be included on the NDIS Provider Register. However, as the NDIS Rules are a legislative instrument, Parliament will be able to scrutinise any matter prescribed under proposed subsection 73ZS(5A). The Legislation Act 2003 requires the tabling of amendments to the NDIS Rules in each House of Parliament, and each House of Parliament will have the opportunity to disallow these amendments under section 42 of the Legislation Act.[35]

The amendment made by item 6 means that any rules made for the purpose of proposed subsection 73ZS(5A) will be ‘Category D’ rules. This means that the Minister cannot make these rules unless each host jurisdiction[36] has been consulted in relation to the making of the rules.[37]

Committee comments

Both the Scrutiny of Bills Committee and the Human Rights Committee expressed concerns in relation to these proposed provisions. The Scrutiny of Bills Committee has a general view that significant matters, such as the matters that could be included on a public register, should be in primary legislation unless there is a sound justification for subordinate legislation to be used.[38] The Scrutiny of Bills Committee notes:

… there is nothing on the face of the bill which would prevent the inclusion of highly sensitive or highly personal information about persons on the Register. As a result, the committee notes that the potential disclosure of information regarding persons subject to banning orders will not be subject to the full range of parliamentary scrutiny inherent in bringing proposed changes in the form of an amending bill.[39]

The Scrutiny of Bills Committee has sought the Minister’s advice on:

·         why it is necessary and appropriate to leave significant matters, such as what personal information can be included on the Register, to delegated legislation, noting the potential impact on a person’s privacy; and

·         whether the bill can be amended to set out the information that can be included on the Register on the face of the primary legislation.[40]

The Human Rights Committee notes that the publishing of personal details of employees who are subject to banning orders is likely to limit their right to privacy.[41] The Human Rights Committee however noted that this right to privacy ‘may be subject to permissible limitations where the limitation pursues a legitimate objective, is rationally connected to that objective and is a proportionate means of achieving that objective’.[42] The Human Rights Committee notes that relevant considerations in assessing this limitation include determining whether there are other less restrictive ways to achieve the same aim and considering any relevant safeguards with respect to how an individual’s name is placed on the register (for example, whether an entry remains on the register while a decision to make the banning order is being reviewed under sections 99, 100 or 103 of the NDIS Act).[43]

In order to fully assess the human rights compatibility of the Bill, the Human Rights Committee has requested the following information from the Minister:

•       why the Bill allows the NDIS Provider Register to include any 'information about the banning order', without any restriction on the level of detail that will be included

•       why it is necessary to list the names of current and former employees of NDIS providers who are subject to a banning order on a public website, and whether there are other less rights-restrictive means to achieve the stated objective (for example, allowing the Register to be accessed on request) and

•       when is such information included in the Register and what safeguards are in place to ensure that an individual's right to privacy is adequately protected pending any review of a banning order decision.[44]

Information sharing

A key basis for broadening the scope of the Commissioner’s power to make banning orders is that the Commissioner will be able to act on information about the actions of a person in another field, such as in aged care or child care.[45] The Explanatory Memorandum notes the example of the Commissioner being able to pre-emptively take action in respect of such an unsuitable person.[46] This appears to align with the context of the death of Ms Smith (discussed in the ‘Background’ section above) where the carer in question previously had action taken against them by a South Australian regulator.

In this context, it is important to note that one of the Commissioner’s core functions under the NDIS Act is ‘to engage in, promote and coordinate the sharing of information to achieve the object of [the NDIS] Act’.[47] For example, the Bilateral Agreement between the Commonwealth of Australia and the State of South Australia on the National Disability Insurance Scheme includes multiple references to shared information arrangements. One of the specific ‘shared responsibilities’ provided for in that agreement is to:

… support the principles of Interoperability with other service systems by sharing information and data to the greatest extent possible to support participant safety, the effective Integration of the Scheme and jointly monitor outcomes, subject to privacy and other confidentiality requirements.[48]

The success of the broadened banning order powers as proposed by the Bill may be dependent on the degree to which relevant information is shared by different agencies so that relevant persons can be identified proactively.

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[1].              L Buckmaster and S Clark, The National Disability Insurance Scheme: a quick guide, Research paper series, 2018–19, Parliamentary Library, Canberra, updated 8 May 2019. For further background on the National Disability Insurance Scheme, also see: L Buckmaster and J Tomaras, National Disability Insurance Scheme Bill 2012, Bills digest, 72, 2012–13, Parliamentary Library, Canberra, 2013.

[2].              Council of Australian Governments (COAG) Disability Reform Council, Communiqué, Sydney, 2 September 2016.

[3].              For more information see P Pyburne, National Disability Insurance Scheme Amendment (Quality and Safeguards Commission and Other Measures) Bill 2017, Bills digest, 52, 2017–18, Parliamentary Library, Canberra, 13 November 2017.

[4].              Section 73ZN of the NDIS Act was inserted by item 48 of Schedule 1 to the National Disability Insurance Scheme Amendment (Quality and Safeguards Commission and Other Measures) Act 2017. An NDIS provider means a person who receives funding under certain legislated arrangements or NDIS amounts. An NDIS provider can include a person or entity who provides supports or services to people with disability outside the NDIS if prescribed by the NDIS rules. See NDIS Act, section 9.

[5].              D Tune, Review of the National Disability Insurance Scheme Act 2013: Removing red tape and implementing the NDIS Participant Service Guarantee, Department of Social Services, [Canberra], 2 December 2019, p. 17.

[6].              S Robert, ‘Second reading speech: National Disability Insurance Scheme Amendment (Strengthening Banning Orders) Bill 2020’, House of Representatives, Debates, 12 June 2020, p. 4061.

[7].              See: ABC News, ‘NDIS investigating Ann Marie Smith's death as Anglicare confirms carer was subcontracted’, ABC News (online), 18 May 2020; N Harmsen, ‘Ann Marie Smith's carer was banned amid missing money claims, SA committee hears’, ABC News (online), 25 May 2020.

[8].              Harmsen, op. cit.; L Henriques-Gomes, ‘Former judge to investigate death of Adelaide woman Ann Marie Smith in full-time care’, The Guardian Australia (online), 26 May 2020. The South Australian Government’s Safeguarding Task Force, triggered by the death of Ms Smith, delivered its final report on 31 July 2020, see: Government of South Australia: Department of Human Services (DHS), ‘Safeguarding Task Force’, DHS website, updated 3 August 2020. 

[9].              Robert, op. cit.

[10].              Senate Standing Committee for Selection of Bills, Report, 6, 2020, The Senate, Canberra, 18 June 2020, p. [4].

[11].              Senate Standing Committee for the Scrutiny of Bills, Scrutiny digest, 8, 2020, 17 June 2020, pp. 7–9.

[12].              Parliamentary Joint Committee on Human Rights, Human rights scrutiny report, 8, 2020, 1 July 2020, pp. 32–36.

[13].              R St Clair, ‘New banning powers to strengthen protection of NDIS participants’, Disability Support Guide website, June 2020.

[14].              Ibid.

[15].              Ibid.

[16].              Ibid.

[17].              Ibid.

[18].              Explanatory Memorandum, National Disability Insurance Scheme Amendment (Strengthening Banning Orders) Bill 2020, p. 1.

[19].              The Statement of Compatibility with Human Rights can be found at page 4 of the Explanatory Memorandum to the Bill.

[20].              This section has in part been excerpted and informed by: P Pyburne, National Disability Insurance Scheme Amendment (Quality and Safeguards Commission and Other Measures) Bill 2017, Bills digest, 52, 2017-18, Parliamentary Library, Canberra, 13 November 2017, pp. 21–22.

[21].              NDIS Act, subsection 73ZN(2).

[22].              NDIS Act, subsection 73ZN(10). Subsection 73ZK(1) of the NDIS Act provides that civil penalty provisions under Part 3A of Chapter 4 of the NDIS Act (which includes section 73ZN) are enforceable under Part 4 of the Regulatory Powers (Standard Provisions) Act 2014. The Regulatory Powers (Standard Provisions) Act provides in subsection 82(5) (contained in Part 4) that the maximum penalty for contravention of a civil penalty provision by a body corporate is five times the pecuniary penalty specified for the civil penalty provision. This means the maximum penalty is $222,000 for an individual or $1,110,000 for a body corporate. The value of a penalty unit is prescribed under section 4AA of the Crimes Act 1914; under the Notice of Indexation of the Penalty Unit Amount a penalty unit is currently $222.

[23].              NDIS Act, section 73ZO.

[24].              NDIS Act, subsection 73ZN(7).

[25].              NDIS Act, subsection 73ZN(8).

[26].              Robert, op. cit., p. 4063.

[27].              Ibid.

[28].              Scrutiny of Bills Committee, Scrutiny digest, op. cit., p. 7.

[29].              Ibid. The Minister’s response was received by the Committee on 7 July 2020 but has not yet been published.

[30].              NDIS Act, subsections 73ZS(1) and (2).

[31].              NDIS Quality and Safeguards Commission, ‘NDIS Provider Register’, NDIS Quality and Safeguards Commission website.

[32].              The NDIS Rules are made under section 209 of the NDIS Act.

[33].              Explanatory Memorandum, op. cit., p. 2.

[34].              Ibid.

[35].              Legislation Act 2003 (Cth), section 38. For details on the Parliamentary scrutiny of legislative instruments see: Legislation Act 2003 (Cth), Part 2 of Chapter 3.

[36].              NDIS Act, section 10 provides that the Minister may, by legislative instrument, specify that a State or Territory is a host jurisdiction, with the agreement of that State or Territory. Schedule 1 of the National Disability Insurance Scheme (Host Jurisdiction) Specification 2016 lists the host jurisdictions.

[37].              NDIS Act, subsection 209(7).

[38].              Scrutiny of Bills Committee, Scrutiny digest, op. cit., p. 8. 

[39].              Ibid.

[40].              Ibid., pp. 8–9.

[41].              Human Rights Committee, Human rights scrutiny report, op. cit., p. 33.

[42].              Ibid., p. 34.

[43].              Ibid.

[44].              Ibid., p. 36. The Minister’s response was received by the Committee on 21 July 2020 but has not yet been published.

[45].              Explanatory Memorandum, op. cit., p. 1.

[46].              Ibid.

[47].                             NDIS Act, paragraph 181E(h).

[48].              Commonwealth Government and South Australian Government, Bilateral Agreement between the Commonwealth of Australia and the State of South Australia on the National Disability Insurance Scheme, Council of Australian Governments website, 29 June 2018, p. 3.