Federal Government Optimistic NDIS Reform Deal Soon to be Reached

‘We are pretty close and very hopeful,’ Finance Minister Katy Gallagher said.

The National Disability Insurance Scheme NDIS logo is seen at the head office in Canberra, June 22, 2022. AAP Image/Mick Tsikas

Australia’s Minister for Finance Katy Gallagher said that a recent deal with the Coalition to reform the National Disability Insurance Scheme (NDIS) so that its annual growth is capped at 8 percent is close to being finalised.

The proposed changes would also reduce the amount of new participants eligible for the scheme and change the funding criteria.

Legislation has previously been delayed from passing through parliament by the Coalition and Greens who deferred the laws to further inquiry.

However, Gallagher said she is confident a deal has been reached.

“We are pretty close and very hopeful,” Gallagher told reporters in Canberra on Aug. 18.

She said that although work has to be done with states and territories, this is an important bill to start trying to control NDIS growth, rather than allow the scheme to balloon as quickly as it currently is.

“I don’t want to pre-empt some decisions that have been taken in party rooms and the rest, but I’m hopeful that we should see that through this week.”

Need for Reform

The NDIS provides individualised fee-for-service funding for people who have permanent and significant disabilities.

However, following recent investigations into the scheme, Minister for NDIS Bill Shorten expressed the need for systematic reform of the entire disability support ecosystem.

He identified six priority areas for reform, one of which was addressing spiralling costs.

The NDIS is the third-largest program in terms of total general government sector expenses.

In 2023-24, the estimated expenditure of the NDIS was $41.9 billion (US $27.9 billion) and projected expenditures suggest the scheme could cost up to $51.9 billion by 2025-26.

In comparison, the estimated expenditure of Medical Benefits Health was $30.4 billion (US $20.3 billion) in 2023-24 and its 2025-26 projected expenditures were $34.1 billion.

Minister for Government Services and the NDIS Bill Shorten at a press conference at Parliament House in Canberra, Australia on Feb. 12, 2024. AAP Image/Mick Tsikas

Shorten said in an ABC interview that the NDIS can be run better.

“It’s life changing, it’s an investment, it’s fantastic, it’s exceeding expectations, but it can’t keep growing at the rate it is, it’s going to keep growing,” he said.

Shorten acknowledged that state governments are concerned about the possibility that they will have to start looking after kids they didn’t expect to look after.

“But our independent review, talking to thousands of people with disabilities, says the NDIS can’t be the only lifeboat in the ocean,” he said.

“It was never the intent when we set up that scheme that we wouldn’t have a range of less intensive supports for families and people with disabilities outside the scheme.”

Shorten said that the states have statutory responsibilities to people with disabilities.

“You know, we’re not in charge of the schools in NSW, but at the moment we’ve got NDIS therapists going into schools because they need more support,” he said.

Reaction of Opposition

Shadow NDIS Minister Michael Sukkar told Sky News there were some worthy changes in the proposed NDIS reforms.

“We’ve been working pretty cooperatively with the government, and we'll see if we can find some middle ground,” he said.

“If we do so, then that support will be forthcoming.”