NDIS must be sustainable financially in the long term

When Bill Shorten lays down the law on the National Disability Insurance Scheme, you don’t have to bet that he won’t deliver on tough talk. He tells you. On Tuesday, the NDIS Minister told the National Press Club that Labor premiers did not support his legislation to save money in the scheme but “I will do just about everything to try to convince the states to like what we’re doing.”

Mr Shorten expresses an admirable commitment to the work of the NDIS and is committed to keeping it in place, so he is looking for a reduction in the rate of growth of NDIS funding – which is far different from reforms to make its costs credible to taxpayers. The Getting the NDIS Back on Track Bill that is before the Senate addresses changes proposed in the review published in December last year that called for tighter controls on what clients could access.

As Sarah Ison reported on Wednesday, Mr Shorten wants to “decrease the cost curve … and I think it will tighten things up that need tightening up”. Presumably what he wants to tighten are controls on misuse of NDIS funds – the $2bn of the $40bn the scheme costs being “inappropriately spent”, according to its fraud control chief. And when Mr Shorten talks about costs, he means reducing the rate of increase from 15 per cent a year to 8 per cent. This includes some cost-shifting to the states, which would make the NDIS budget look better. For example, states could take-on “foundational supports”, in-home care and targeted assistance for people with specific needs.

The fast-growing number of children diagnosed with autism or development delay accounts for three-quarters of NDIS clients under 18 and makes up 20 per cent of the scheme’s total costs. Certainly that could save money by ending the individual support packages the NDIS provides.

But there is more to state objections than money. Tasmanian Premier Jeremy Rockliff and South Australian Premier Peter Malinauskas warned on Sunday that Mr Shorten’s plan would have “social impacts on states” and was “a significant shift away from the original co-governance model”. It seems likely that Mr Shorten will do whatever he needs for the states to sign up so he can claim the NDIS is fixed, but it won’t be. The December review warned that, on trends, the scheme costs could rise from about $40bn to $100bn in a decade.

Trimming the rate of growth to 8 per cent is not much comfort given that across time costs inevitably will increase that only a government of rock-ribbed resolve would refuse to pay. Last year, the Albanese government funded an $11bn pay rise for aged-care workers and last week there was $3.6bn for childcare staff. Unions representing the 270,000-strong disability workforce, unsurprisingly, now want a pay rise. And if saying no to workers would be hard, cutting benefits to disabled Australians to fund pay rises for their carers would be unjust. But savings must be made, now and continuing in the future, to ensure taxpayers willingly continue to accept the costs.

“No country makes the level of per capita investment in disability that we do. And that’s a good thing. But I want this scheme to be here in the future,” Mr Shorten said on Tuesday. The way to ensure that is for taxpayers to believe it is fair and affordable for both the national and household budgets. Making a show of cracking down on shonky service providers exploiting clients and stealing from the public is a political way to do it, but change will require policy work and sooner or later it will mean giving people fewer services – or no services at all. The way to delay that day is to demonstrate the NDIS is as efficient and effective as it can be. Mr Shorten’s bill passing will be a start but only the first of many reforms that will be needed to keep the scheme’s value for the immense amounts of money it will cost.