The National Disability Insurance Scheme (NDIS), which costs $42 billion a year and has been growing at more than 10 percent a year, has finally delivered some good news for the government, spending $1 billion less than previously forecast in the 2024/25 federal budget.
Concern over the ballooning cost of the scheme led politicians to pass new laws, which came into effect last month, to cap growth at 8 percent per annum.
Despite the saving, growth for the current financial year is set to be 12 percent, though that’s a reduction from the 19 percent recorded over the previous 12 months.
Without reforms, the cost of the NDIS is projected to exceed $50 billion a year by 2025/26 (at which point it would be higher than the universal health program Medicare), and reach $120 billion a year by 2034. More than 660,000 people with disabilities are participants in the NDIS.
The states and territories and the federal government have been locked in a protracted dispute over how to split the costs of the scheme with the Western Australian government recently revealing it had spent $62.8 million.
Reform Underway
The minister responsible for the scheme, Bill Shorten, said the $1 billion saving showed NDIS reform can occur without compromising its original intent.
“It is possible to improve the scheme without undermining its fundamental values,” Shorten said.
“Whilst that’s led to tears at bedtime by some of the dodgy providers with crystal therapy and other therapies which are just not evidence-based, the truth of the matter is is now providing clarity.”
He said while there had been criticism about overhauling the scheme, the reforms were improving the lives of people with disabilities.
Under the reforms, there are stricter eligibility requirements for people with disabilities to obtain funding, with participants also having to go through new assessments to qualify for support.
Shorten said the lower spending on the NDIS did not mean less support.
“We’re just running the scheme better. That doesn’t mean that we’re not providing services. There'll be more people on the scheme next year than this year,” he said.
The NDIS Commission’s annual report shows the scheme received 78 percent more complaints than the previous year—a total of 29,054—and resolved 15,064 of them. Most concerned worker conduct and provider practice.
Compliance activities also showed a marked jump: 147 infringement notices were issued—a 1,236 percent increase; there were 187 registration revocations, up 79.8 percent; and 124 banning orders—an increase of 34.7 percent.
Warning letters went up by over 7,300 percent, with 3,558 issued during the year.
The NDIS Quality and Safeguards Commission also issued a record number of fines, with $4 million in penalties handed out.
As of June 30, 2024, the NDIS fraud taskforce has opened 58 investigations into 230 providers and executed 109 “compliance actions.”
