16 May 2023

In the government’s continuing efforts to reduce the growth of the National Disability Insurance Scheme (NDIS), the 2023-24 Federal Budget outlined measures to save $15.3 billion from the Scheme’s growth through “improved administration”. 

Arguably the biggest single budget change, the speed and scale of these savings may not have been noticed by many on Budget night, as they appeared on page 211 of Budget Paper Two and were only briefly referenced at the end of Treasurer Chalmers’ interview on the ABC. 

The Budget announced that $732.9 million has been allocated to reining in the predicted cost of the growth in the NDIS with over $550 million of that budgeted to three key targets of the eight total measures: 

  • $429.5 million will be spent on the National Disability Insurance Agency (NDIA) over four years to invest in its capability and systems to improve processes and planning decisions; 
  • $73.4 million will be spent over four years to better support participants to manage their plan within budget, including assistance from NDIA and holding plan managers, support coordinators and providers to account; and 
  • $48.3 million will be spent over two years to invest in the NDIA’s ability to detect, respond to, and reduce fraud and non-compliant payments, including to develop a business case for new IT platforms and systems to detect and prevent fraud and non-compliant payments. 

Addressing the National Press Club (NPC) on Wednesday, 10 May, Treasurer Jim Chalmers said the NDIS “was never designed for every Australian with a disability, but for the most severely and profoundly impaired”. 

The Budget’s projected cost savings were originally announced by Prime Minister Albanese to National Cabinet two weeks ago and reiterated in Bill Shorten MP, Minister for the NDIS’ NPC address earlier this month. 

“Without action, Scheme expenses would increase by $17.2 billion over four years from this financial year,” the Budget Paper reads. 

“The funding in this measure supports the NDIA to improve the administration of the Scheme, which will reduce additional growth in Scheme expenses by $15.3 billion, moderating additional growth to $1.9 billion over four years.”  

According to the Budget, these targets will save “$59 billion over seven years from 2027-28 to 2033-34”, however, the savings will start much earlier than 2026. The Budget reveals they will kick in from July. 

Ability Options CEO Julia Squire says the organisation supports the intention to improve the capability of the NDIA and the Budget’s focus on tackling fraud and non-compliance in the NDIS. 

“The Scheme is really important and to remain supported by everyone involved in the Sector and the broader Australian Community, we must improve these things,” she said. 

“The savings sought are significant. We have not seen enough information to show that the investments in administration and fraud detection will make the level of savings needed not to impact participants currently in the scheme, new participants who will need the scheme, the market of viable Providers and the quality and safety of services. 

“We’ve also yet to see, if the NDIS is not the only lifeboat, where the other boats are. Beyond the investment to improve administration, the risk is that the cap on growth will: 

  • Reduce access to services desperately needed by people with disability without putting in place other services including by states and other sectors including education; and/or 
  • Reduce the quality and safety of services offered; and/or
  • Reduce prices making it unviable for providers to offer services impacting the choices participants have and reducing even further the control they have over their choices. 

“So, while we welcome the focus, as far as it goes, and note the enormous investment in capability and countering fraud, we want providers to be actively engaged in seeing the detail and in the future sustainability of a high quality Disability Sector which meets the vision set out by the existing Minister when he designed the NDIS in the first place.  

“We will do all we can to help.” 

Watch this space: Ability Options will provide more updates as they become available 

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