The future of the NDIS – Australia’s world-leading scheme to support people with disability – is in doubt because the costs are exploding.
Now the federal government is acting. The Getting the NDIS Back on Track Bill proposes a massive overhaul of the National Disability Insurance Scheme, in order to rein in costs and provide greater clarity on program delivery.
While the Bill has been pitched as an improvement to access, program sustainability, and protections from unethical practices, many people with disabilities are concerned about whether their support will be continued, and if they are still eligible for the program.
Disability Program experts Sam Bennett and Hannah Orban are joined by host Kat Clay, to discuss how the proposed changes will affect the NDIS.
- More information on the Bill from the NDIS
- Sam Bennett and Hannah Orban assess the Bill
Transcript
Kat Clay: The federal government has introduced the Getting the NDIS Back on Track Bill to Parliament. The bill proposes a massive overhaul of the National Disability Insurance Scheme in order to rein in spending and clarify how the program is delivered.
This comes in the wake of last year’s independent review of the NDIS and builds on some of the proposed changes in more detail. While the bill has been pitched as an improvement to access, program sustainability and protections from unethical practices, many people with disabilities are concerned about whether their support will be continued, and if they are still eligible for the program.
I’m Kat Clay, and this week on the podcast, we will break down the bill in detail with Grattan’s disability program experts, Sam Bennett and Hannah Orban.
Sam, the idea for this podcast came from a series of posts that you’ve made on LinkedIn, analysing the bill, and you wrote that this is as close as you can get to a total rewrite of the NDIS act without throwing the current act away. Given this sounds like such a radical reworking of the scheme, I feel like there’s probably a big answer behind this question, but overall, what does this bill seek to do?
Samuel Bennett: Well, I did make it sound like a big deal on that, in that post, didn’t I? And that’s because it is, it really is a pretty major reworking. And broadly it seeks to do a couple of things. First is it’s, the basis for recommendations in the review that you just referred to being implemented, quite a lot of those aren’t immediate.
So, what the bill does is it kind of provides the scaffolding around which further rules will need to be drafted and agreed or at least consulted on depending on the category of the rule to bring about some of the big changes the review recommended, and we’ll come on to some of those.
The second thing it seeks to do is to make some changes in the shorter term. That will help to moderate the cost growth that the scheme is currently experiencing. So that the target that national cabinet agreed last year of growth at 8 percent by 2026 is remotely attainable. And those two things they are related because the review certainly had sustainability of the scheme as part of its terms of reference as well.
But listeners may recall from our December podcast that my view was that there was precious little really in the review that was oven ready, that would do anything to contain cost growth in the short term. So, the bill goes some way to filling that vacuum. But in terms of some of the specifics of what it does propose, it reimagines some of the key design features of the current scheme in a pretty major way. Features that I think have been fundamentally flawed really for an awfully long time, including a different approach to resource allocation and planning a different experience for participants, in the future, depending upon the route they’ve come into the scheme, whether that’s under early intervention or disability criteria, a new definition around NDIS supports, which is intending to guide, a use of funding in, future a more flexible budget for participants to use on those supports and then, as I said, the bill provides a legal basis for a range of tighter controls that should help to moderate growth. So, it is pretty root and branch. There’s clearly a lot of details still to be ironed out but this is a necessarily ambitious rewrite in my view to address many of the challenges the scheme faces, cause we’re running out of time to make this scheme work right.
Kat Clay: Yeah, I was surprised when I read your posts given the lack of detail that had been in a lot of the NDIS review to see how much more detail was in the bill and a lot of the changes there as well, which we’ll, definitely go into in more detail. Obviously, the biggest question facing the NDIS is the matter of financial sustainability.
And so, it’s no wonder that a lot of the proposed reforms relate to funding. The current funding model means that people with disability request support, and this request is then assessed for whether it’s reasonable and necessary, which could be knocked back. And this bill seeks to tie funding to standardized assessments under new framework plans.
So, the question for you is, how does this change the existing funding model, and is it a step in the right direction?
Samuel Bennett: Yeah. So, there’s a lot of jargon in that, isn’t there? And the whole language of new framework plans is certainly something that the bill has added to with that. And you’re right that the current model we’ve discussed it before on, on this, podcast, it involves, as you say, application of some pretty subjective criteria to each and every support that someone might request.
Is it in relation to their disability? Is it likely to be beneficial? Does it represent value for money? Those sorts of things. And some people have called that bottom-up planning. And that means you build up the support in a plan line by line so that the plan ends up being the sum total of everything that’s been deemed reasonable and necessary through that process.
It’s led to some highly inconsistent and inequitable outcomes, costs are unpredictable, there’s no relationship currently between the individual planning decisions that are made in the overall budget for the scheme.
And that’s a problem. So, I was really pleased to see the review tackle this issue. And I think it did it in a very sensible way, which, as you said, is to say that in future, a budget won’t be built in that way. It will be determined on the basis of that standardized needs assessment. And then a system that translates those needs into, a funding outcome.
And that’s what the bill provides for. The methods that will apply to both the assessment and the funding determination though, those are going to be set out in legislative instruments and rules, which we don’t yet, yet have but what it does do, is provide, as you say, a step direction. It would have not been possible for government to implement the review’s recommendations without significant legislative change. So, it’s not so much the detail in the bill that I see as a positive thing, because that’s still substantially lacking. It’s the fact that government hasn’t shied away from the scale of the change that was proposed that I think is really positive.
Kat Clay: So, Sam, just on that question of funding as well, I mean, is there anything else proposed in the bill that has an immediate impact on cost growth here?
Samuel Bennett: There’s quite a few things in the bill that will be implemented as soon as 28 days after it comes in should it be, passed and a number of those will impact on cost growth in a variety of ways particularly the issue of what’s called intra plan inflation.
That’s the fairly frequent trend we see whereby a participant’s plan is spent down more quickly than the period for which it was agreed and that usually leads to the agency topping up the plan because someone still needs support that happens all the time.
It’s responsible for a pretty significant proportion of the additional growth that the scheme is seeing beyond ordinary inflationary pressures. So, there are a few things in the bill that sort of go specifically to that and to helping participants to manage the funding in the plan, in a more effective way.
The first is that all old framework plans, so this is all current plans, basically, or any new plans that are built before the new framework comes in, those will now need to specify total funding amounts or total component amounts and the funding periods which apply to them.
Now the bill makes amendments then also to clarify existing legislative requirements for participants to spend in accordance with their plan to say that in future that will include meaning staying within those total funding amounts. Effectively, what that does is it introduces a requirement to stick within the limit.
Of course, if there’s a change of circumstances a reassessment can still be done a new plan can be put into place but a lot of current growth in plans doesn’t result from such a process, so it means at least there’ll be a proper process established if more funds are needed and when a total funding amount is exceeded other powers in the bill would enable the agency to take a number of actions.
It might be that they change the way that the plan is managed to it being agency managed so that they’ve got more direct control over the funding, or they could take action to recoup an amount if there’s concern that it’s been misused.
There is one other though, Kat, which is really important, and I think a lot of people have been talking about, and that’s the new definition in the bill for NDIS supports, and there’s a requirement then that a participant only spends their funds on those supports. There’ll be rules around this as well including ones that may expand the list of things that are essentially out of bounds that will never be deemed a NDIS support.
I think that’s helpful because it brings some, greater clarity. I do think it’s something where there needs to be some real balance though, because an extensive list of specific things that are in and out. I don’t think is a very useful thing to attempt because in most cases in, in disability, it will depend on the person’s circumstances as to whether the support’s likely to be right for them.
Kat Clay: Although I did note that one of the strange things that was excluded from NDIS spending was gambling and I was surprised that they even had to write that in as a factor.
Samuel Bennett: Yeah, that’s not a new one actually, Kat, but you’re right. there are already a few exclusions in the in the rules for the current act. And that includes gambling and ordinary costs of living, but they have added a few others in there as well. White goods, which I think is a slightly contested one to be honest, because there could be perfectly legitimate reasons why certain white goods blenders and the like might be a perfectly appropriate NDIS support for someone with a disability. Let’s hope the list doesn’t get too long, I think is my point because this needs to be a permissive framework because the scheme depends on creative and flexible use of funds to meet participant needs.
Kat Clay: Yeah, a hundred percent I had the same thought on white goods because I’ve seen some of the specific white goods for people with vision impairments.
Hannah, one of the things I do want to talk about now is the question of access because people are concerned about with changes how does access to the scheme change as well?
And there are proposed changes to the early intervention approach. As it stands, it’s not differentiated as an access point to the NDIS. And I want to know why that’s an issue and what. are the proposed changes?
Hannah Orban: So, there are two pathways to enter the NDIS. The first is if you have lifelong and severe disability, and it’s called the disability requirement pathway. And the second is if you need early intervention, and it’s called the early intervention pathway. So, the problem is that right now, there’s pretty much no difference between them.
They should be different, but they’re not. The point of early intervention is that you get the help you need at the earliest possible stage, so you can lessen the impact of your impairments. Typically, children, people with psychosocial disability and people with chronic illnesses join the NDIS through the early intervention pathway. The point of the disability requirement pathway is to give people with lifelong and severe disability a long term set of services that they have chosen and that are designed to help them live independently and achieve their goals. So, two pathways and two totally different purposes. So put yourself in the shoes of a parent and your child’s just been diagnosed with developmental delay.
You want to get the best possible services that you can so that you can lessen the impacts of impairments on your child down the line. Your child doesn’t really need an individualized plan to help them live independently with funding that lasts for several years.
Your child needs a short-term fixed budget, a set of evidence-based interventions that will help and not harm them. Now consider if you were a 28-year-old with Down syndrome, you join the scheme through the disability requirement pathway, and what you need out of the NDIS is very different.
You want to maximize your independence. You have a set of goals you want to achieve. Maybe that’s getting some training so you can get a new job, moving out of home and some time with the occupational therapist. What you need is unique to you. So, an individual NDIS plan based on your goals makes sense. You also don’t want to have to prove your permanent disability to the agency over and over again. So, a longer-term plan would be better. And this bill would extend plans to be as long as five years. So, in an ideal world, people joining the scheme through the early intervention pathway, get just an off the shelf budget, a set of evidence-based supports.
and people joining this scheme who have a lifelong and severe disability get a long-term plan and they get to choose a set of bespoke supports that help them be independent. Unfortunately, the issue is we’re seeing no difference between them really. This means that families are in the very difficult position of having to choose which therapies are best for their children, possibly under pressure from providers, rather than just being directed to the best possible evidence-based support.
And people in the scheme with lifelong disability are getting shorter term plans, meaning they have to prove they still have their lifelong disability every year or so. The other issue is that the early intervention pathway is sometimes being treated as a permanent spot in the NDIS.
The NDIS provides support to people who need specialist disability services for severe disability. So not all children who join this scheme will need the NDIS for the rest of their lives. Children and young people make up more than half of NDIS participants, and we’re not really seeing many children exit this scheme as they get older.
It’s certainly the case that some people stay in this scheme because they have a lifelong and severe disability. However, the rate of non-mortality exits from this scheme is about 0. 9 percent per annum when it’s projected to be 1. 9 percent per annum. And that’s partly a result of the early intervention pathway not functioning the way that it should.
So, with assessments, the bill would make it possible for the agency to check if people who joined through the early intervention pathway still need to be in the scheme under the disability requirements.
And if that’s implemented well, it could make a big difference to people’s experience in this scheme and help to make the NDIS more sustainable as well.
Kat Clay: I think that’s quite a good lead into what I want to talk about next, which is one of the things that we’ve talked about previously on the podcast is how there needs to be more supports in the community other than the NDIS. The NDIS review proposed new foundational supports and are there provisions for this in the bill?
Hannah Orban: We have talked about this before, and it is one of the most important factors for the future of the NDIS. The existence of support outside the NDIS. In fact, if people can get services outside this game, then that will take pressure off the NDIS. And right now, everyone wants to join it because it’s one of the only places for people with disability to get the services they need.
as you said, foundational supports, that’s the new term for services with people for people with disability outside the NDIS. It’s still just an idea. Government is yet to implement it. And this bill doesn’t explicitly mention foundational supports. But what it does do is introduce a new term, which Sam mentioned before NDIS supports. So how the agency defines NDIS supports will determine what you can get with your NDIS plan. So, it’s quite an important one to watch for people inside and outside the scheme. For example, and this is totally made up, not government policy. If the NDIA decided that it would no longer fund speech therapy, then it would be up to foundational supports to provide that therapy.
So whatever service is not a NDIS support, and the agency won’t fund it, then that could become a foundational support. It may not, but it could become a foundational support.
Kat Clay: So Sam, one of the biggest questions coming out of the proposed changes to the NDIS is that people with disability are worried about their access being revoked with these proposed changes. What does the bill have to say about this?
Samuel Bennett: So look, this is a really important one to clarify. I agree because understandably there’s, quite a lot of anxiety and concern amongst the disability community on this one. So, what the bill does is it introduces this new information gathering power whereby the CEO can compel the provision of certain information that’s most often assessments or medical reports for the purposes of reassessing someone’s need to stay on the scheme. Reassessments do currently happen, but they’re often undermined in practice because there isn’t this requirement for participants to provide new information, which means the agencies often making these decisions or not, as the case may be on the basis of old information or what they’ve got on file.
So, the bill introduces a time frame, so 90 days for requested information to be provided. If it hasn’t been after that and there’s no extenuating circumstances for it, then the agency can, revoke somebody’s participant status. So, you can see absolutely why that might raise anxiety levels.
The explanatory memorandum goes some way to providing assurances around how this power would be used. So, it won’t be used to force people to, re evidence their disability. If that’s a lifelong disability every year, that would be completely pointless. But there are groups of people for whom this power might quite sensibly apply.
So, there are participants that are just uncontactable for a long period or may never have been contactable, and there might be some legitimate concerns as to whether they actually exist or whether this is actually a sort of a fraudulent sort of behaviour that, that’s being picked up. Also, the person might have left the country, they might be overseas, and they wouldn’t then, continue to meet the residency requirements that there are for the NDIS and a scheme as big as the NDIS now is more than 650, 000 people.
The group of people that are uncontactable might not be, as small as you think. But the second and probably larger group for whom it may apply are the large numbers of participants, hopefully a larger number in future if some of the other things the bill does work as intended that come into the scheme under the early intervention requirements.
And that’s because you’re going to want to periodically reassess. Those individuals to understand the impact of what that early intervention has been. If supports are still needed, then the person can continue to receive early intervention supports if that’s the right approach for them.
They can be transitioned to the disability requirements, so they’re into the lifelong disability support part of the scheme or they can be supported to exit the scheme because early intervention has been effective and possibly in future that might involve them being directed to foundational supports, which we’ve talked about.
So, it’s a really going to be very important that the power is used carefully. I certainly don’t want people to be kicked off the scheme for no good reason, but I don’t believe that’s the purpose of this. It’s much more about correcting a basic flaw in the legislation, which means it’s been very difficult to effectively administer.
Kat Clay: Yeah, there’s a very complicated balance here between obviously supporting people in the NDIS and making sure that things like fraudulent claims aren’t being honoured and clearing those out as well. So, we will keep an eye on what happens with this. Sam, I’m wondering, do you foresee amendments to this bill coming?
Samuel Bennett: Gosh, I’ll get my crystal ball out. It’s hard to say that there’s a process in train now that has begun on the 27th of March, when Senate referred the provisions of the bill to the Community Affairs Legislation Committee, they’ve got an inquiry and they’re due to report back on 20th of June. I think about it that the liberals made attempts to reform the NDIS in some not dissimilar ways back in 2021. So, I would expect their support with this bill. I might anticipate some pushback on aspects of it from the Greens, but I’m not entirely sure where the main focus of that will be because there’s been some fairly polarized positions in opposition to the bill that have been voiced and they seem based. as much on, disagreement about the extent to which government has consulted and the co design that they would like to have seen rather than too many of the specifics. But if I was to really hone in on a couple, perhaps you’d, expect to see amendments proposed to provide further clarity on the issue we just talked about around when revocation might occur the other things that the CEO should consider in those circumstances, you might see some amendments proposed there.
You might also see amendments proposed around the new definition for NDIS supports, given how critical a new criteria will no doubt become.
Kat Clay: Just a practical question, Hannah. I mean, if the bill’s passed, what’s the timeline for these changes?
Hannah Orban: Yeah. So, the timeline Kat is that the bill needs to go to the Senate. And if it’s passed and gets royal assent, it will come into force 28 days later. So really quite soon. However, not everything in the bill will come into force straight away. So, there are some aspects like new framework plans, stated supports.
There are lots of rules that the agency needs to work out, and the minister has indicated that could take some time. So, it’s not totally clear when exactly everything will start, but as soon as 28 days for some aspects of the bill.
Kat Clay: One last question for you, Sam. I mean, as a thought experiment, what would happen if this bill didn’t go through, and we didn’t make changes to the NDIS?
Samuel Bennett: I’ll try and choose my words carefully here because I don’t think causing alarm is a very helpful thing to do. Whether you think the bill is a good thing, as I do, I don’t think it’s perfect, but I think there’s lots of good stuff in there. Or whether you don’t which many people seem not to.
I think this bill has to be passed. The issues the bill is trying to fix were urgent three years ago. At this point the issues the scheme faces are pretty huge. And part of that is simply how much bigger it is than it was three years ago. I don’t mean to say that people aren’t still getting a lot of life changing outcomes along the way, but I think the scheme is now almost impossible to administer under its current legislation. It’s simply not possible to make tens of thousands of complex decisions every week under the current criteria in a way that’s going to be remotely fair and consistent and equitable. And there are, as I’ve mentioned already on this podcast, there’s an absence of basic controls to manage costs that means this thing is in effect a runaway train. And runaway trains tend to crash. They don’t tend to pull into a siding so that everyone can debate the relative merits of different ways to cushion the blow. So, look, I don’t think it’s surprising that trust in government is at a premium. But I do think it’s really important to take the sustainability of the scheme incredibly seriously at this point.
The NDIS design is fundamentally flawed, and its redesign is urgent. So, look, I really hope we see this bill or some version of it passed so we can get on with the job of saving the scheme for now and for the future.
Kat Clay: That’s a good place for us to wrap it up for this week. Thank you so much, Sam and Hannah for your insights. We will keep following how the Bill progresses through parliament and keep you updated on that. Please do find Sam and Hannah on social media, on LinkedIn and do talk to Grattan Institute across all our social media platforms. We’d love to hear from you. As always, please do take care and thanks so much for listening.