‘Far beyond what was agreed’: States step up rebellion over Shorten’s NDIS plan

State premiers have stepped up their rebellion over the federal government’s plan to overhaul the $42 billion National Disability Insurance Scheme, claiming they have no idea about the costs they could be up for and have been sidelined in the process.

In a bid to delay new federal laws that will introduce changes to the scheme, NSW Premier Chris Minns and Victorian Premier Jacinta Allan accused the Commonwealth of going “far beyond” the scope of the significant funding deal they struck with Prime Minister Anthony Albanese last year.

The state premiers are rebelling over the NDIS changes and what it will mean for their budgets.Credit: Fairfax Media

But Government Services Minister Bill Shorten will proceed with the draft laws on Wednesday despite the state objections, putting the changes to federal parliament to start weeks of debate into how the states and territories will offer new support services.

Shorten insisted the changes were needed to ensure NDIS funding went to the people the system was designed to help. “We’re not going to put change in the too-hard basket,” he said.

While Shorten tried to shore up support in calls with state and territory ministers over the past week, the key stumbling block has been the fear of an uncosted fiscal exposure that could weaken the ability of the states and territories to fund other services.

Premiers and chief ministers agreed at a national cabinet meeting in December to partner with Albanese to deliver a new system of “foundational supports” for 2.5 million Australians through state health and education systems, so that not everyone with a disability needed to join the NDIS.

However, Minns warned on Tuesday that Australians could end up “off the NDIS” and without suitable services under the changes, unless premiers were given costings and a greater say in how the new system rolled out in places such as schools and childcare centres.

“Every state premier, every state chief minister, is concerned about the federal government’s NDIS reform because it means less of a say for the states, but more responsibility for the states,” Minns said.

“If, at the end of the day, the Commonwealth charges full steam ahead, a lot of people are off the NDIS programs and they tumble into state services. I want to make sure that we’re there to catch them. And we can only do that if we can quantify how much this will ultimately cost.”

As Shorten prepared to introduce the legislation this week, premiers convened a sudden meeting on Monday night to present a united case to Canberra for delaying the draft law so all sides could be consulted.

On Tuesday, Allan said they had made that demand for several reasons. “The first is that the scope of the legislation, as we have seen it only late last week, goes far beyond what was agreed at national cabinet last December,” she said.

“Secondly, too, there has simply not been adequate consultation with states and territories as is required by federal legislation for any change to be brought about to the National Disability Insurance Scheme.

“And then finally, and most importantly, we’re really concerned about the people who rely on the NDIS, ensuring that they continue to receive the support that they need … We’ve got to remember who we’re talking about here. It’s people with a disability who rely on these services.”

The premiers’ revolt will be a roadblock for Shorten, who needs the states to step up disability services so the NDIS can return to its original purpose of supporting Australians with the most severe disabilities.

Instead, the scheme is now relied upon by more than 9 per cent of five to seven-year-old children, most of whom have joined the NDIS with autism or developmental difficulties because their families find it too hard to get support outside it.

The larger-than-forecast number of young children in the scheme is a major reason NDIS costs blow out each quarter; it is one of the federal government’s fastest-growing budget pressures and will cost more than $100 billion in a decade without change.

Minns said he accepted that costs in the NDIS – which are borne mostly by the federal government – were rising exponentially.

“But if it means that there’s going to be cost shifting onto the states, and more pressure on [the] hospital system, in particular, I need to know and quantify what those costs are going to be,” he said.

“Part of the frustration from state and territory leaders to the federal government’s NDIS proposed reforms is they’re not able to tell us how much [state] taxpayers will be on the hook for disability services in the state.

“Now, that’s not us walking away or saying we don’t want to be part of reform. But I think it’s a commonsense suggestion to say: we want to be around the table, co-design what reform looks like.”

He said that was the agreement that had been struck last year in Canberra.

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