The NDIS is Shorten’s legacy, and Labor’s problem

With his exit from politics in the diary for tomorrow, former Labor leader and outgoing National Disability Insurance Scheme (NDIS) Minister Bill Shorten is reflecting on the service behemoth that is his portfolio’s namesake.

A new workforce report forecasts the NDIS will have a full-time equivalent workforce larger than the mining or agriculture industries by 2025-26.

The opinion of the minister – who promised to pare back the scheme’s growth by $15 billion in four years, a target Labor is set to achieve – on this is extremely positive.

Bill Shorten will leave politics on Monday.Credit: Alex Ellinghausen

Speaking to Paul Sakkal in The Sun-Herald today, Shorten credits the scheme with boosting jobs growth, creating a “new part of the Australian economy” through what he argued was one of the most important economic reforms in recent history.

“This is an example of Australian exceptionalism,” he said of the 11-year-old scheme introduced by former Labor prime minister Julia Gillard, with which he has had a long history – dating from his appointment as parliamentary secretary for disabilities in the Rudd government in 2007.

Earlier this month, Shorten declared the NDIS was no longer the government’s “major problem child”, as he installed former disability royal commissioner Rhonda Galbally to the scheme’s administering board, and said he would trust the Coalition to run the scheme.

None of these moves seem to do much favour for Labor’s mandate of reforming the exponentially growing scheme into something financially manageable.

It was a less celebratory Shorten who last year announced major planned cuts to services covered by the NDIS, ranging from sexual services to holidays and alternative therapies such as reiki and animal therapy.

In December, The Sun-Herald reported the scheme’s actuary as saying the government was on track to limit annual growth of the NDIS to 8 per cent, down from about 20 per cent in recent years.

In its mid-year budget update, the federal government announced it would spend $1 billion to reboot assessments, hoping to spend a little to save a lot more.

The equivalent of half a million people are projected to work for the NDIS in some way by next financial year. Of those full-time equivalent positions, 311,000 are solely working for the scheme.

A taste of the impact of cuts came late last year, when the job security of hundreds of art and music therapists was threatened after several providers in discussions with the NDIS were left with the impression funding would end.

Shorten was forced to clarify the changes would instead cap funding and, for renewed funding, require participants to provide evidence the therapy was working.

It’s a tricky exercise for Shorten to boast about the size of the scheme after spending years highlighting widespread rorting. His arguments that the NDIS has diversified and boosted the economy may have merit, but are largely friendless among the economist class.

The NDIS may be one of modern Labor’s biggest reforms, but the unwieldy scheme has come at a big cost that politicians will spend years wrangling.

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