Audit office finds $22bn NDIS rolled out too fast to be managed

A report could reignite a battle for control of the NDIS between federal and state governments.

Social Services Minister Christian Porter. Picture: AAP

The rollout of the $22 billion Nation­al Disability Insurance Scheme happened so fast that “major risks” around the development of businesses and a caring workforce were heightened by a lumbering, complex, multi-­government decision-making ­regime.

The findings from an Australian National Audit Office report could reignite a battle for control of the NDIS between the federal government and the states and territories, all jurisdictions with competing interests.

It will take at least a decade to develop the necessary number of disability workers and businesses, according to both the Department of Social Services and the National Disability Insurance Agency, in submissions to the audit.

The audit, which looked specifically at the transition of the market from the old system to the new, heard from the department that ­neither it nor the agency had effective control over policy.

“The necessary complexity of the ... governance arrangements is a notable feature of the scheme that means DSS, or indeed the NDIA and DSS, have limited ­options for unilateral policy and program activity,” the DSS says. “States and territories hold many of the levers for successful market transition over which the commonwealth has little influence or control.”

Oversight of the scheme is such a mess that a planning document for the workforce and market strategy was not introduced until two years after the trials began and, even then, the ­report says, “does not commit juris­dictions to specific deliverables, accountabilities and milestones.”

During transition, the federal government is required to “extensively” consult with states and ­territories as partners in the delivery of the NDIS, a situation in which the rollout has raced ahead of governments’ capacity to agree on policies.

“The disability care workforce (which needs to double between 2012 and 2019-20) is a major risk to the NDIS rollout, which needs to be carefully monitored and managed,” the report says.

“Key market design and policy elements required agreement by all governments. In practice, the timeframes assoc­iated with this collective ­decision-making arrange­ment have been inconsistent with the implementation time frames set by governments.

“This has increased the NDIS’s operational complexity and elevated risks for the market ­transition.”

Social Services Minister Christian Porter attempted to tweak some of the scheme’s governance arrangements — such as eligibility guidelines and what constituted “reasonable and necessary” ­support — but the move was howled down by some states as a power grab.

The audit report appears to ­vindicate Mr Porter, who told The Australian he was “constantly and closely” monitoring the needs of the sector in the rollout.

“The disability market will take time to grow and meet demand. We are supporting its growth through the Sector Development Fund, which has provided funding to date of over $90 million.”

However, the audit says there is “limited evidence of a strategic ­approach to the use” of this $146m fund, which has been running for three years.