THE National Disability Insurance Scheme has grown too big too fast, and its future is now at stake, according to the findings outlined in a new Grattan Institute report.
The Institute is an independent organisation that researches and advocates for public policy solutions.
In its latest report, ‘Saving the NDIS: How to rebalance disability services to get better results’, the Institute found that while costs must be reined in, it can be done in a way that ensures disabled Australians can get the help they need.
The NDIS scheme cost nearly $42 billion in 2023-24 and is expected to cost more than $58 billion by 2028.
“It grew by about 24 percent a year on average from 2019-20 to 2023-24 and is now one of the biggest pressures on the federal budget,” says report lead author and Grattan Institute Disability Program Director, Dr Sam Bennett.
“In 2011, the Productivity Commission estimated a mature NDIS would serve 490,000 people.
“But in fact, the scheme is now supporting more than 700,000 people and that number is projected to pass a million by 2034.”
Dr Bennett said the number of adults in the scheme is only slightly higher than originally expected, but the number of children is nearly double.
“Yet most disabled Australians don’t qualify for the NDIS and there is little support for them outside the scheme,” he said.
“The problem is the NDIS has become the only game in town: you either get an NDIS package, or you get minimal mainstream services.
“That means disabled Australians have an incentive to try to get into the NDIS – and once people get in, they tend not to leave.”
To address this issue, the federal, state and territory governments agreed in 2023 to fund new ‘foundational supports’ – disability-specific supports outside of individual NDIS packages – which were supposed to be operational by July 1, this year.
Those foundational supports are nowhere to be seen says Dr Bennett.
The Grattan report urges the Federal Government to make four big policy changes to save the NDIS.
“First, the NDIS needs firmer boundaries so it is clear who the scheme is for and what needs it is intended to meet,” Dr Bennett said.
“Second, the way the NDIS manages claims needs to change so funding is allocated fairly and consistently. People should have more choice and flexibility in how they use their NDIS funding.
“Third, the federal, state and territory governments should finally establish a strong tier of ‘foundational supports’ to ensure disabled people get appropriate supports when and where they need them.
“Under the Grattan Institute’s plan, the existing NDIS budget would be used to fund foundational supports from within the same funding envelope.
“And fourth, Australia needs a new National Disability Agreement, to clarify the relationship between all aspects of the disability policy landscape and to facilitate cooperation and greater accountability between governments.”
Dr Bennett says the Grattan Institute blueprint to rebalance disability services would reduce NDIS payments by about $12 billion over the next 10 years, and create further savings of $34 billion over the same period by not requiring new money to fund foundational supports.
“Saving the NDIS is not a question of spending more money – our analysis shows the problem lies in how existing funding is allocated.
“The NDIS is a vital part of Australia’s social fabric. It must be saved. Our report shows how.”
