NDIS, Defence spending among big unfinished budget projects this election

The cost of the National Disability Service is expected to go under the microscope this election as experts call out decision-makers for doing the ‘wrong thing’ by both the disabled and taxpayers.

Further reining in the cost of the NDIS and lifting Defence spending are among the big unfinished budget projects both Labor and the Coalition will have to grapple with this election. 

Voters are heading to the polls to choose between two leaders yet to fully outline a long-term vision to repair the federal budget, which is forecast to remain in the red for the next decade.

The National Disability Insurance Scheme, which is demand driven, remains the second highest growing payment over the medium term at 8 per cent, behind only interest repayments on government debt.

Currently growth is at about 10 per cent, which is significantly less than the 22 per cent rate of expansion under the Coalition government, but the current opposition has argued more must be done though is yet to outline what it would cut.

The cost of the NDIS is a big unfinished budget project for both Labor and the Coalition. Picture: NCA NewsWire / Brenton Edwards

Though Labor is ahead of where it expected to be at this point, NDIS expenditure is still expected to grow by $15.1 billion over the forwards, from $48.5 billion in 2024-25 to an estimated $63.6 billion in 2028-29.

Grattan Institute director for disability Sam Bennett said Labor’s budget offered little reassurance it would help to reduce growing costs.

“There’s some minor downward revisions in the forecasts that are being attributed to successful reforms. I think it’s a bit early to be seeing those green shoots,” he said.

Mr Bennett said creating foundational supports – services in the community, such as in schools – would save the NDIS the most money, but that the NDIA should be able to fund that itself with the money it already has.

NDIS Minister Amanda Rishworth said the Coalition’s calls for further restricting the NDIS growth were “deeply concerning”.

“Some of the suggestions about where growth should track at would suggest that no new participants could enter the scheme next year,” she said.

Despite the need to cut spending or raise revenue to lift the budget out of structural deficit, pressure is also building for Australia to lift its total Defence spending to three per cent of GDP.

NDIS Minister Amanda Rishworth says the Coalition’s calls for further restricting the NDIS growth are deeply concerning. Picture: NCA NewsWire / Brenton Edwards

Currently spending is on track to reach 2.4 per cent of GDP by 2030, but Strategic Analysis Australia director Michael Shoebridge said this didn’t reflect changing global conditions, headlined by Donald Trump’s return to the presidency.

“There are always competing ways to spend government money – but in a world that’s become more dangerous, with a more unreliable or demanding major ally, the priority of funding our defence is inescapable,” he said.

Independent economist Chris Richardson said people were “arguing about the tiny things” in the budget, such as income tax cuts and fuel tax cuts, because real issues such as structural spending weren’t discussed ahead of elections.

Mr Richardson acknowledged the NDIS had a massive dollar amount that was “not achieving value for money”.

But he said decision-makers were doing the “wrong thing by both the disabled and taxpayers”.

“The government is quite correct that it has made important reforms, but most of what it has done is accounting,” he said.

Mr Richardson said as the world was becoming “more volatile”, Australia needed to buy more “off the shelf” instead of trying to tailor defence arsenal and prop up marginal electorates with manufacturing.

“We need effective, we need mass produced, we need cheap,” he said.

Originally published as NDIS, Defence spending among big unfinished budget projects this election