Coalition Senators Additional Comments
1.1The National Disability Insurance Scheme Amendment (Getting the NDIS Back on Track No. 1) Bill 2024 [Provisions] intends to reform the National Disability Insurance Scheme to create a stronger, more sustainable program that supports people with disability. A number of questions remain unanswered due to important measures yet to be finalised at the time of writing. According to NDIS Minister Bill Shorten, the Bill will 'usher in a new era of NDIS reforms that ensure the Scheme can continue to provide life-changing outcomes for future generations of Australians with disability and to make sure every dollar in the Scheme gets to the participants for whom the Scheme was designed'. We expect this is merely a first tranche in a suite of policy measures that will be rolled out, but already, there are large gaps that threaten to become chasms in due course if not addressed. The Coalition seeks to make the government and the public aware of these to ensure this legislation is an air tight, ironclad bedrock that future policies might build on in this reclamation project for Australians living with lifelong and permanent disability.
1.2This Bill amends the NDIS Act 2013 to:
Require the NDIA to provide participants with a clear statement of the basis on which they entered the NDIS. The Bill will also clarify and expand the NDIS rules relating to access provisions, including the methods or criteria to be applied when making decisions about the disability and early intervention criteria and the matters which must or must not be taken into account.
Create the new reasonable and necessary budget framework for the preparation of NDIS participants' plans. The Bill provides for 'new framework plans' to be developed in accordance with a new budget framework. Participants will receive funding based on whether they accessed the Scheme on the basis of impairments that meet the disability requirements or the early intervention requirements or both.
Provide for the needs assessment process and the method for calculating the total amount of the participant's flexible funding and funding for stated supports for new framework plans to be specified in legislative instruments and NDIS rules.
Insert a new definition of 'NDIS supports' which will provide a clear definition for all participants of the authorised supports that will be funded by the NDIS and those that will not.
Insert measures focussed on protecting participants including: allowing the CEO to specify the total funding amount for reasonable and necessary supports together with the funding component amount under the plan for each support or class of support up to a specified amount; Clarifying the requirement that an NDIS participant who receives an amount or amounts for NDIS supports may only spend that money in accordance with the participant's plan; and enabling the NDIA to change the plan management type, as well as impose shorter funding periods to safeguard the participant who may be exploited or coerced to use their package in a way not consistent with their best interest.
Inserts quality and safeguard amendments, enabling the imposition of conditions on approved quality auditors to not employ or engage a person against whom a banning order has been made, and to enable greater delegation of the Commissioner's compliance and enforcement powers to specified positions.
1.3The Bill contains two schedules. Schedule 1 sets out the new definition of NDIS supports; clarifies the process for reassessment of participant status; provision for participants to transition to a new framework plan; provision for new framework plans that include a flexible budget and budget for stated supports; old framework plans to have total funding amount; updates to circumstances in which the Agency will manage funds; specification of the requirement that participants spend money only on NDIS supports and in accordance with their plan; and exemptions for NDIS rules from sunsetting. The instrument would regulate the system and make determinations on which stream people are applied to. It would regulate and assess those who are temporary supports and permanent ones.
1.4Schedule 2 of the Bill enables the Commission to attach conditions to the approval of an approved quality auditor. This schedule will also strengthen the NDIS Commissioner's ability to take regulatory actions by delegating certain compliance and enforcement powers and functions.
1.5The expectation would be, the implementation of these new measures would reduce the cost burden of taxpayers on the scheme and cap growth at 8% p.a.
1.6The Coalition will work constructively with the Government on this NDIS overhaul, because we believe the scheme is for everyone and is a valuable support for many Australians, sitting beyond partisan politics and tit-for-tat opportunism. The reality is, no one knows when they might require its services, and the existence of such a scheme, as a safety net for our most vulnerable, speaks volumes to the character and goodwill of Australians at large.
1.7Unfortunately, in recent times, the aligned priorities for the scheme have begun to diverge and have disappointingly become somewhat more political, to the detriment of all those concerned with the scheme's success.
1.8The Coalition remains committed to a NDIS that is person-oriented, responsive, sustainable, and continues to provide vital support for participants, but it in turn, will not simply support poorly formed policy, nor will it hand the government a blank cheque.
1.9Collaboration is not marked by fierce agreement, rather the willingness to critique and be critiqued in the pursuit of a common good.
1.10The Coalition believes the Government ought to outline how the measures included in this Bill will achieve the projected savings and contribute to the overall sustainability of the scheme, while addressing the diverse needs of NDIS participants, sooner rather than later. A number of stakeholders have raised concerns anecdotally with their local members and patron senators about the uncertainty that remains around the NDIS. Whether or not this is indeed the case, the government must acknowledge public perception and work to allay the fears of Australians living with disability, as well as providers, plan managers and all adjacent services and individuals impacted by the scheme.
1.11As it stands, the current proposed legislation remains ambiguous and is therefore difficult to meaningfully engage with, and it holds additional, serious concerns around potential litigation arising from absent detail and minimal clarity as to how savings will be achieved and growth will be capped. The NDIS remains one of the largest costs to taxpayers and sources of budgetary blowout for the government.
1.12Labor went to the 2022 election claiming the Coalition were slashing NDIS plans by up to 90 per cent 'leaving people with disability without the supports they need for daily life and cutting funding for autistic children, stopping them from accessing the scheme'. As part of its 'Better Future for the NDIS' election policy, to get the Scheme back on the right track, Labor committed to review the NDIS design, operation and sustainability with the findings of the Review to guide the Government on priority areas of reform.
1.13The final report of the NDIS review 'Working together to deliver the NDIS' was released on 7 December, making 26 recommendations and 139 supporting actions. The final report noted all recommendations and actions be implemented as a package to achieve a more inclusive and fairer Australia for all people with disability. Among the recommendations, the Review recommended legislative reforms to improve eligibility and access and an early intervention pathway for children. Foundational supports were recommended that would be available to people with disability and in some cases if appropriate families and carers. Foundational supports would be available to all Australians with disability regardless if they are on the NDIS or not. These supports would interconnect with existing services such as schools and childcare. Early childhood intervention would help children with disability and developmental delays be identified early and receive the support needed. Another recommendation was a new approach for those with psychosocial conditions, to better meet episodic needs and focused on personal recovery. Service navigation was also recommended to help people with disability find and access the services that are available to them, including mainstream services, community supports and the NDIS. The amendments in this Bill give effect to NDIS Review recommendation 3 and elements in recommendations 5, 6 and 7. The amendments also support the partial implementation of recommendation 17.
1.14All of these processes have been crucial in identifying areas of concern and specific choke points in the administration of the scheme, however, instead of a process of rolling reform and consultation, the government has chosen to receive in full, the recommendations and findings of various reviews as a whole, before considering its response. The Coalition reserves judgement as to whether this was or was not the correct approach; rather responding to the information which is now before us.
1.15The Bill provides concepts and processes without much detail and was described by the Minister as 'scaffolding'. Further detail is to be included once consultation has occurred with the disability community and states and territories. This approach, means engagement can only occur in a piecemeal fashion, with the expectation or hope that that which is lacking in present legislation, shall be included in forthcoming tranches. This proves difficult to adequately scrutinise, and limits the certainty with which participants and providers are offered at any given time, but the nature of rolling reform does provide for changes to occur more expediently than waiting for a comprehensive and complete framework, one would assume.
1.16It is imperative states are brought back to the table, and service providers are making themselves available to all people in need if we are to succeed in reigning in spending on the scheme whilst ensuring that the community still has ample access to various supports. Some providers have seen the opportunities presented for greater profitability through the NDIS and have jumped at it, leaving services beyond the scheme sparsely available and financially unviable. States ultimately have better access to community health services and therefore should return to the field. Rather, in partnering more closely with the Commonwealth, it can be ensured there are services sitting beyond the NDIS that are readily available for members of the community who do not require significant and lifelong supports.
1.17Last year the Government announced the imposition of the National Disability Insurance Scheme growth cap of 8 per cent by 1 July 2026. Nowhere in this legislation is there an outline or an explanation of where the savings will be made. When the Coalition was in government and sought to put the scheme on a sustainable footing, Labor ran its 'Hands off our NDIS' campaign claiming the Coalition were to slash plans. Plans will likely be reduced following these reforms (and future reforms) if the Scheme is to be put on a sustainable footing. State premiers attempted to delay the introduction of this legislation, accusing the Commonwealth of going far beyond the scope of the funding deal announced last year. NSW Premier Chris Minns warned people could end up off the NDIS and without suitable services. Reports in The Australian also revealed growing concern in the Labor Party about the absence of costings and modelling. Victorian Premier Jacinta Allen said 'We do not believe…that it reflects the agreement that was struck by first ministers at national cabinet last December.'
1.18While Minister Shorten argued any delay to the passage of the legislation would have a financial impact on the scheme, the Coalition sought to hear from state and territory officials about what commitments - if any - had been made to ensure and assure the disability community that supports would exist beyond the scope of the scheme.
1.19An entire inquiry day was set aside for this. Unfortunately, not a single minister from any jurisdiction appeared before the committee.
1.20State and Territory governments must be held accountable and must do their part in ensuring supports exist for people with a disability in their jurisdictions, not only to alleviate pressures on taxpayers in the sustainability of the NDIS, but because of their obligations to administer health services and supports for all Australians in their respective jurisdictions, of which they are presently failing.
1.21There must be clearly outlined responsibilities and rules for state and territory governments to avoid ambiguity about service delivery expectations. These statements should be prepared and published as soon as is practicable on a departmental website.
1.22Choice and control lies at the heart of providing participants with a sense of empowerment, enabling them to live as comfortably as possible without the cumbersome limitations of an already difficult situation coping with the difficulties of disability as well as navigating supports.
1.23The Coalition feels this lens should be applied as consistently as possible, enabling participants to tailor their plans to their needs, where applicable and appropriate, rather than a one-size-fits all approach.
1.24There is a pessimistic view in the disability community that expected cost savings to reduce the rate of cost growth (targeting 8% p.a) will not eventuate, and participant outcomes, and potential safe access to essential disability support, could be compromised by the changes contained in the Bill. The Coalition agrees the Bill fails to clearly articulate where the savings are to be made to put the Scheme back on a sustainable financial footing.
1.25A large portion of the uncertainty embedded within the scheme sits with the opacity over the 8% growth cap. There remains little detail on how the growth cap will be met, if it is indeed even met at all. Indexation of fees continues to see increasing fees charged on individuals still struggling to navigate services to access affordable providers. There is no transparency over the apparent looming $60bn black hole that is hovering over the scheme.
1.26The NDIS Scheme Actuary has outlined that the $14.4 billion of savings across the forward estimates results from changes to intraplan inflation and budget model efficiencies. However, the NDIA, DSS and the Government have refused to release the actuarial data and modelling to support the savings, despite consistent calls from the Coalition. In addition, the lack of cooperation in providing necessary information to scrutinise the Bill through the committee process, including questions on notice, is of deep concern.
1.27The Coalition has called for the government to release the NDIS Financial Stability Framework and the cost savings to be made by this legislation and to provide a detailed outline of the inevitable cuts that participants should expect as a result of these changes.
1.28Providers themselves are taking advantage of significant opportunities for increased profitability by charging at the top end of the price guide. Because of the price guide, service providers on the scheme can make significantly more than if they were off the scheme, leading participants' budgets to increase in line with the additional costs. Dissolving the price guide and replacing it with one more consistent with fees charged across the sector will assist in driving down cost pressures on the scheme.
1.29Despite the Prime Minister's pre-election commitment running a government of transparency and honesty, the Albanese Labor government has been marked its inability to provide detail, timely information or be forthcoming about various financial or social implications as a result of its policies. If reform of the scheme is to be possible, it is imperative that the NDIA and the government begin to restore the faith and trust of the community by beginning to be transparent about the state of the scheme.
1.30The NDIA must ensure the financial sustainability of the scheme and release the Financial Stability Framework outlining cost savings and sustainability at the 8%p.a. growth target. This should be done in order to provide greater clarity and certainty around the scheme's trajectory, for greater accountability, and where cuts and savings have and will be made.
1.31It must also publish reports and statistical summaries on a website outlining total amounts of paid supports for participants each month, the number of participants on the scheme, and average annualised payments made to participants in order to increase transparency and accountability of the agency, providers, and participants alike.
1.32There is a complex balancing act that must be applied when legislating around the issue of rorts and misuse of the scheme. It is, after all, the area that garners the most media attention. However, the pursuit of justice must be applied most intentionally and carefully so as to not punish participants for the actions of the few who abuse the system. During the most recent round of Senate Estimates hearings, we heard from NDIS Head of Fraud and Integrity John Dardo who told the committee up to $2 billion in NDIS funding was being misused, with revelations there were criminal syndicates using the scheme to sell and traffic illegal substances. In recent years, there have also been indications of NDIS funding used for accessing the services of sex workers, using funding to go on lavish holidays, among many others. It must be stressed that these are exceptional cases, but nonetheless, in a scheme that is continuing to cost taxpayers more and more, work must be undertaken to curtail unnecessary and inappropriate spending.
1.33The services of sex workers should be excluded from NDIS Supports.
1.34Furthermore, plans should be wholly managed by the NDIA if participants are or have been convicted of a serious criminal offence, or convicted of an offence involving fraud or dishonesty.
1.35The concept of reasonable and necessary is still present in the legislation, however the term will now relate to the budget level of a plan – that is, if the budget is 'reasonable and necessary' as opposed to if individual supports are 'reasonable and necessary' as is currently the case. Using reasonable and necessary for plan budgets and not individual supports should give the NDIA greater visibility of the overall costs of individual plans and not have officials deciding if individual supports are reasonable and necessary. This may make it easier for the government to reign in spending within the scheme to meet the 8 per cent growth target. The reform provide greater flexibility to allow participants to use the funding as long as the expenditure meets the new definition of NDIS Supports. The definition provides the constitutional underpinning for the new planning framework by setting out the kinds of supports that the Commonwealth is constitutionally capable of funding. The definition will also allow NDIS rules to be made that narrow the scope of constitutional supports funded under the Scheme. It will be clearer for participants to know what can be funded and what cannot be funded.
1.36There remains no clarity of definition for what 'permanent' and 'lifelong' constitute with regard to a disability as a means to determine eligibility and term of funding received from participants.
1.37There needs to be clear definitions inserted into the legislation for 'reasonable' and 'necessary', as well as for 'permanent' and 'lifelong'.
1.38The Bill places essential Scheme architecture to the legislative instrument (the Rules), rather than placing essential architecture in the primary legislation; this means there will not be parliamentary oversight of the development of the future NDIS.
1.39The Support Needs Assessment will directly inform plan budgets. The 'method' will be determined by the Minister (subclause 32K(2)). This should be detailed in the primary legislation. Without transparency principles outlined in the legislation, this process will not have parliamentary oversight, and we return to the issue of the method of budget-setting taking place in a 'black-box'. Key principles around this 'method' will need to be included in the NDIS legislation, for transparency, trust, sound fiscal management; and to protect the rights of NDIS participants.
1.40Under the legislation, participants can enter the scheme, meeting early intervention requirements, disability requirements or both. Plan budgets will be determined on a 'needs assessment' and a needs assessment will be introduced to provide 'consistency and equity for planning decisions'.
1.41The Coalition welcomes the streamlining of processes that are difficult to navigate and exacerbate anxieties and frustrations within the community. It is especially welcome, individuals who have permanent disabilities would no longer have to repetitively provide evidence of disability, and that funding within a plan may also be released in instalments, rather than in full at the commencement of the plan. This should assist participants in better utilising funding and make it less likely funding allocations will be exhausted earlier.
1.42Longer plans should also moderate plan growth as the costs of plans tend to increase whenever plans are replaced.
1.43However, little information is available on the needs assessment process, with no evidence the Government has consulted with the disability sector on what the process will involve. A significant workforce would be required to conduct needs assessments of all current and new entrants into the scheme. The Labor Party ran a scare campaign against the Coalition when it sought to introduce independent assessments. Like needs assessments, independent assessments were to provide 'consistency' in participants' plans.
1.44As yet, there is no publicly available Bill Implementation plan (or formal acceptance of the NDIS Review recommendations), while implementation has clearly begun. This plan needs to be shared transparently and as a priority, so that the community, and parliament, can understand the vision and intention of the Bill. There remains a dearth of detail in the scaffolding of the Bill, regarding Needs Assessments. These will be mandatory assessments and will determine plan budgets. It is crucial they are delivered by qualified health professionals, as recommended by the NDIS Review and it is prudent to have clarity around the function and determination of the needs assessment before the legislation is changed, rather than retroactively. Appeal rights will also need to be clarified. With the current reformation of the Administrative Appeals Tribunal, there is currently additional uncertainty and anxiety around the appeals process that was already, anecdotally, causing participants distress.
1.45Greater detail should be included in the primary legislation outlining the function of the forthcoming 'Rules' to ensure parliamentary oversight.
1.46The needs assessment process should be outlined clearly, even if in an external communique. Existing assessments should be prioritised over the development of bespoke assessments and these must be appealable.
1.47Other concerns raised by stakeholders included the failure by the minister to give adequate opportunity for consultation in the drafting of the Bill. These stakeholders maintain without examination and scrutiny of the full and complete proposed changes, the Bill would deliver a result akin to 'Frankenstein's monster' making it increasingly difficult for participants, their families and providers, to gain fair and equitable access to the scheme and supports they need. For example, what is and is not an NDIS support must not be so strict as to disallow a participant to justify why it is reasonable and necessary for a requested support to be funded. There has been a lack of a co-design approach to developing the Bill. It is unclear who has been consulted. Disability representative organisations have allegedly been consulted; however, Non-Disclosure Agreements were in place. The Bill makes multiple references to co-design, yet the Bill was not open for public consultation, which harks back to the lack of transparency, fairness, compassion and accountability stakeholders have expressed misgivings about.
1.48Minister Shorten's address to Parliament on 27 March 2024 in his Second Reading speech made multiple references to 'foundational supports', additional funding and a financial commitment from States and Territories:
I applaud their commitment last December to finance additional disability services outside the NDIS program – the 'foundational supports' we speak of – on a 50-50 funding model, so we can meet an agreed growth rate target of 8% from 1 July 2026.[1]
1.49At no point does the Bill refer explicitly to foundational supports. The Bill refers to a 'larger landscape of supports outside of the NDIS'. These supports will be a part of 'new framework plan', however, it is unclear what these will be.
1.50There has also, as of the time of writing this report, been no formal government response to the Disability Royal Commission or the NDIS Review. Without understanding the government's position on the various recommendations, it is difficult to ascertain how they might intend, in future, to progress or reform the scheme.
1.51The success of the proposed reforms will depend on a viable sector with quality providers, so without the other elements required to achieve that (addressing workforce shortages, realistic and independent pricing, and a regulatory system that promotes quality and an even playing field) then the risk of any reforms being unsuccessful is heightened. Equally, the process to determine, and offer, defined NDIS Early Interventions would need to be described in the Bill, to ensure the scaffolding for effective, evidence-based, contemporary, and co-design of early intervention is in place.
1.52The Bill attempts to keep participants' spending within their budget by introducing a requirement to stay within their budget. This will reduce the need and circumstances for the NDIA to provide additional funding in cases where participants exhaust their funding early. Plans will clearly set out funding amounts and the period this amount applies to. Arrangements will also be legislated to change plan management to agency managed if plans are exhausted early, or if issues are identified with current management arrangements. This may also moderate growth within the Scheme. However, providers have stated these arrangements are already in place. The real issue is the NDIA having the resources to manage these plans. The Bill refers to NDIS supports rather than reasonable and necessary supports. This includes a framework that outlines participant budgets instead of line-by-line reasonable and necessary supports. We have concerns with this amendment to flexible funding without transparency around services that can be funded by participant budgets.
1.53The Bill also provides a new power for the CEO to receive information, such as medical reports to decide if the participant should remain in the scheme. Section 30 of the Bill grants enhanced Plan Revocation powers to the NDIS CEO. This extraordinary expansion of powers should be carefully considered and reviewed with appropriate checks and measures to ensure the abuse of such powers is not made accessible, especially the 90-day non-response timeframe where there is evidence that the delayed participant response is disability-related.
1.54Current language in the legislation should be amended to clarify without ambiguity, the function of CEO powers and the protections therein to mitigate abusive conduct.
1.55Consideration should also be given to the establishment of a rigorous external review process for the expanded CEO powers that provides clear oversight on any decisions made through the exercising of the sweeping powers.
1.56Whilst it is unlikely psychosocial and autism will be moved off the scheme, and while some Coalition senators feel psychosocial supports ought to be overwhelmingly provided by the states - when they are actually able to deliver on their mandate - there is still an element of uncertainty about their fate on the scheme due to the lack of clarity made around provisions for them.
1.57In the case of Supported Independent Living, the government should work with people on the scheme to design a range of living options into their future. Supported Independent Living is an incredibly valuable component of the NDIS, but has become one of the highest cost-burdens of the scheme.
1.58There remains significant gaps for reform in the development of a method for more consistently assessing and determining funding levels for housing and living supports.
1.59Community members have made wide-ranging recommendations to address some of these issues including specific regulations for group home settings to enhance safety and quality, to remove abusive and neglectful conduct by workers in the homes and address the conduct more expediently when it occurs.
1.60Methods for determining adequate funding levels for housing and living supports should be refined as well as ensuring there are stringent safeguards and regulations for group home settings.
1.61We mustn't forget that the NDIS is the NATIONAL Disability Insurance Scheme, not just the major city insurance scheme. We have to ensure regional and rural communities have equitable access to support. Our regions are heavily impacted by natural disasters and social isolation and these issues are exacerbated by the inaccessibility of these supports, especially for families who are caring for a child with a disability. Addressing this underutilisation will require a multi-faceted approach. It involves improving access, raising awareness, enhancing service delivery, and addressing systemic barriers. This can be done through a mix of telehealth services, assistive technology, transportation assistance, education and training programs, employment support, social and recreational activities for community-building and advocacy and peer support networks as a mental health provision and suicide prevention strategy, which we know can be quite prevalent for farmers during times of severe hardship.
1.62Policymakers must ensure a regional & rural lens is applied to legislation to ensure it is fit-for-purpose for all Australians irrespective of their location.
1.63The former Coalition government - and owning any of its shortcomings - undertook significant work on the NDIS over nine years including funding and implementing the scheme to provide support for more than 550,000 participants. Under the Coalition government – we successfully provided crucial services to Australians and fully financed the National Disability Insurance Scheme as a demand-driven initiative.
1.64The Opposition will always be willing to consider and support change that is beneficial to participants. The Coalition remains committed to a non-partisan approach to dealing with the scheme. It will and ought to be a rigorous contest of ideas to produce the best possible outcomes for Australians living with disability.
1.65We want a dedication to aiding all Australians with disabilities in attaining greater independence, honing employment skills, accessing development opportunities, and enhancing their overall quality of life. Our goal is to create opportunities for people living with disability in a financially manageable way; a way that taxpayers aren't burdened by, and that participants aren't a slave to.
1.66For the reasons outlined, there remain grave concerns about this legislation's ability to both solve the current legislative issues that exist surrounding the scheme, protect participants or providers from unintended consequences, including legal complications. It remains unreasonable that the legislation herein still lacks the crucial elements that would form the central pillars of this NDIS amendment such as the provision of detail on the legislative instruments (the rules) and where significant budgetary savings will be made as a result of this new legislation provided by the government.
1.67Whilst new reforms are welcome by the Coalition, there still remains sector-wide concerns and uncertainty as to whether this legislation put forward by the government, goes anywhere to addressing present problems and/or concerns.
1.68However, the Coalition also believes that reform must begin immediately, now that there has been reasonable time given both to the scrutiny of the legislation and for the introduction of a number of key amendments that will assist the government in striking a balance between driving down financial blowouts and choice and control for participants. We will seek to insert amendments to improve this legislation to ensure that this process of reform works to positively shape the scheme's future and mitigates existing and impending risk.
Senator Hollie Hughes
Senator the Hon Linda Reynolds CSC
Senator Maria Kovacic
Footnotes
[1]The Hon Bill Shorten MP, Minister for the NDIS, NDIS Amendment (Getting the NDIS Back on Track No. 1) Bill 2024 – Second Reading Speech.
Inquiry into the National Disability Insurance Scheme Amendment (Getting the NDIS Back on Track No. 1) Bill 2024.
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