Federal Budget 2023: $500m savings to future-proof NDIS

The Federal Government promises a crackdown on dodgy providers and a more user-friendly scheme to ensure the future of the NDIS.

A plan to rein in the costly and problem-plagued National Disability Insurance Scheme will deliver almost $500 million in savings by 2027 with the Federal Government promising a crackdown on dodgy providers and a more user-friendly scheme.

The government will spend $732.9 million from 2023-2026 in attempt to fix the ailing system with its NDIS Financial Stability Framework that will ultimately deliver a $622.8 million saving in 2026-27 by limiting growth of the scheme.

After economists warned that without intervention the disability services juggernaut could blow out by as much as $100 billion in the next 10 years, the most recent national cabinet saw state leaders agree to halving the annual growth target from 15 to just eight per cent.

The bulk of the Budget money – $429.5 million – will be spent on improving the National Disability Insurance Agency’s systems to improve processes and planning decisions.

More than $70 million will be spent on helping people manage their plans better, $63.8 million to make sure plans are more transparent and flexible, $56.4 million to improve independent living decisions, $48.3 million to detect fraud – including building a business case for an IT system to automatically detect dodgy dealings, $29.3 million to increase the number of participants using evidence-based supports, $24.6 million to trial blended payment models and $7.6 million over two years to improve access to support in First nations Communities.

Treasurer Jim Chalmers told parliament during his budget speech that while the NDIS was “here to stay” action was needed to Ensure the millions spent delivering vital services for its participants actually improved their lives.

“But the inescapable truth is that the Federal Government cannot put all the services that Australians expect and deserve on a more sustainable footing by ourselves,” he said.

His comments are likely to rile state leaders, with earlier comments made by Department of Social Services Minister Bill Shorten about the states needing to “step up” their contributions getting a poor reception.

Labor premiers including Queensland’s Annastacia Palaszczuk and Victoria’s Dan Andrews both said it was called a national scheme for a reasons, and South Australian Premier Peter Malinauskas telling reporters less than a week ago that increasing funding was “not within the capacity of state governments”

At its inception a decade ago the NDIS was originally expected be funded via a 50/50 split between state and territory governments and the Federal Governments.

However, the Federal Government now funds around 66 per cent of the cost of the scheme.

Spruiking his department’s $700-odd million reform plan Mr Shorten said he had listened to the concerns of the community and recognised that “genuine change is required” to deliver a scheme that worked,

“That is why we are investing in these initiatives that will see improvements to the NDIS planning process, making the scheme overall easier to engage with,” he said.

The Budget also includes $142.6 million to support the NDIS Quality and Safeguards Commission, $14.1 million to deliver a Covid-19 Leave Grant to help stop the spread of Covid-19 to vulnerable people, $13 million in policy funding to strengthen the Government’s oversight of the NDIS and get it back on track and $7.3 million to reduce the number of people under the age of 65 living in aged care facilities.

Originally published as Federal Budget 2023: $500m savings to future-proof NDIS