NDIS reboot to save Labor’s budget and end ‘cash for diagnosis’
Labor’s plan to divert autistic children from the NDIS has been branded a vital reform by the expert helping design the overhaul as Anthony Albanese uses his once-in-a-generation victory to rein in the budget.
Diverting autistic children off the NDIS will “reboot” the troubled $46bn-a-year program and end a “cash for diagnosis” culture, the doctor helping design Labor’s landmark reform has declared, as Anthony Albanese uses his once-in-a-generation victory to rein in the federal budget’s most serious threat.
After months of promising there would be no changes to NDIS eligibility as a means to reduce scheme growth to 8 per cent a year, the Albanese government on Wednesday revealed its plan to limit children’s access to the NDIS from 2027 and slash growth further, down to between 4 and 6 per cent annually.
Health and Disability Minister Mark Butler said while it might be “hard for some parents to hear”, it was clear that the NDIS was not suitable for children with mild developmental delays, who should instead be offered “a robust system of supports” as envisaged by national cabinet in late 2023.
On the back of Labor’s biggest majority in the history of the federation in May, the NDIS reboot is the Prime Minister’s first major policy gambit outside his election manifesto and came as business and union leaders were due to tackle the sustainability of the budget on the final day of the economic reform roundtable.
The $2bn Thriving Kids program would serve as the first tranche of the “foundational” or “mainstream supports” promised by national cabinet, with Mr Butler to co-chair the program’s design with pre-eminent pediatrician and childhood development expert Frank Oberklaid.
Mr Albanese and Mr Butler will need to take their plan to roll back the scheme – which is currently growing at a rate of 10.6 per cent, down from highs of 20 per cent a year – to parliament, where it may face attempts to block it from the Greens.
In a veiled swipe at the states and territories, Mr Butler said his negotiations with state counterparts on the new supports to support children outside the NDIS had “drifted” and that the commonwealth would now “step up and lead the work”.
“I’ve had a couple of pieces of feedback …. The first is that states felt that they shouldn’t have to take full responsibility for leading this (foundational supports) program, which is why I’ve indicated today we want to lead. We want to hold the pen on this with them,” he said. But The Australian can reveal no consultation had taken place with the Queensland government ahead of the Thriving Kids program being announced.
“Today was the first time we’d heard about the minister’s Thriving Kids program,” Queensland Disability Minister Amanda Camm said. “We look forward to continuing our work supporting the federal government given the NDIS is their responsibility.”
A NSW spokeswoman said Wednesday’s announcement was “a significant change from the December 2023 National Cabinet agreement”.
“We look forward to the Government tabling a new National Health Reform Agreement proposal for consideration,” she said
Other states were contacted about whether they were consulted but did not reply by deadline.
Former NDIS board director and Aruma chief executive Marin Laverty said the 2027 deadline for children to be diverted from the NDIS onto Thriving Kids was ambitious but necessary in the face of protracted negotiations with the states. “While it’s a big call to set July 2026 as start date for the new Thriving Kids program before it’s been designed, in part to prepare families for July 2027 NDIS child access changes, not setting concrete dates would see state and territory governments drag foundational supports out further and kids continue to access therapies not always supported by evidence of them being in the child’s best interest,” he told The Australian.
Changes to eligibility, which Mr Butler ruled out as recently as May, will come into force from July 2027 and potentially include changes to Medicare to assist in early intervention for autistic children.
In his first interview since being appointed to the role of co-chair alongside Mr Butler, Professor Oberklaid said the NDIS had “not worked for children” and seen those with milder disabilities receive “buckets of money” while others in need missed out.
“Anecdotally, there were stories of children who clearly needed NDIS support, who didn’t get it or it was withdrawn, and alternatively, there were those children with very mild problems who got buckets of money,” Professor Oberklaid, Murdoch Children’s Research Institute co-group leader of child health policy, said.
“Importantly, we moved from a system with child development and child mental health and wellbeing at the cutting edge of assessment … to diagnosis. The whole focus should be not waiting until kids get a diagnosis and then treat them, but looking for opportunities to pick up kids as soon as they start to struggle.
“The resort to a diagnosis, that paediatricians and other professions have relied on … we’ve regressed a decade, I reckon, in our approach to kids, because kids don’t get services unless they have a diagnosis, which is really … the wrong approach, because it’s all deficit orientated, it’s all problematic.”
Foundation director of the centre for community child health at The Royal Children’s Hospital in Melbourne for over 25 years, Professor Oberklaid said his “aim” in helping design Thriving Kids was to stamp out practices such as “cash for diagnosis” and to move away completely from the diagnosis-centric model.
“This is an opportunity, as daunting as it is, to reboot the system in a way that it was intended to run, so it’s more evidence based, fairer and more transparent,” he said.
“Mental health in primary schools or MIPS as it’s known, is one example of a more broadbased approach to supporting young children with a range of needs at that age, including autism or ADHD.”
Mr Butler declared many children were currently being “over serviced” by the NDIS, at the cost of tens of thousands of taxpayer dollars.
“The extent of therapy provided to those children now in the NDIS is extremely high compared to anything you would see in the health system. On average … a young NDIS participant with moderate needs is receiving more than 70 therapy sessions in a year.”
Advocates branded the reform as “quite bold” and while peak bodies like Autism Awareness Australia said they were “not negative” about the changes announced on Wednesday, others slammed the move.
Children and Young People with Disabilities Australia said the initiative was clearly “rushed” and that Labor could “not seriously expect to set up a fully-functional system to replace NDIS supports in under a year”. “To truly honour the principle of ‘nothing about us, without us’, the governments needs to provide adequate time for genuine co-design and community consultation, especially when changes are this significant,” CYDA chief executive Skye Kakoschke-Moore said. Changes to eligibility follow the Australian revealing last month Mr Butler’s health department told their minister to ignore advocates’ concerns if the government were to remain on track to reach its 8 per cent growth target.
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