1.1
This chapter provides general information about this inquiry and also provides background on the National Disability Insurance Scheme (NDIS), including key matters relating to this inquiry.
Inquiry overview
1.2
The Joint Standing Committee on the National Disability Insurance Scheme (the committee) was established by resolution of the House of Representatives on 4 July 2019 and Senate on 22 July 2019. The committee is composed of five members and five senators, and is tasked with reviewing:
(a)
The implementation, performance and governance of the NDIS;
(b)
The administration and expenditure of the NDIS; and
(c)
Such other matters in relation to the NDIS as may be referred to it by either House of Parliament.
1.3
The committee is required to present a report to the Parliament on the activities of the committee after 30 June each year, in addition to reporting on any other matters it considers relevant.
1.4
From December 2020 to October 2021 the committee conducted an inquiry into independent assessments under the NDIS. During this inquiry, the committee heard a range of views in relation to the projected scheme costs of the NDIS. These included concerns raised by federal NDIS ministers and the National Disability Insurance Agency (NDIA) that projected scheme costs posed risks to the long-term sustainability of the scheme. Other submitters however, expressed scepticism about the actuarial data used to argue that there are issues with scheme sustainability, and noted a range of other factors influencing scheme projections.
1.5
In consideration of the evidence already presented to the inquiry into independent assessments, the committee decided to conclude that inquiry and initiate a new inquiry with focussed terms of reference to examine some of the broader questions concerning the implementation of the NDIS to date and projections about its future.
1.6
In October 2021, the committee decided to conduct an inquiry into the current scheme implementation and forecasting for the NDIS, with particular reference to:
(a)
The impact of boundaries of NDIS and non-NDIS service provision on the demand for NDIS funding, including:
(i)
the availability of support outside the NDIS for people with disability (e.g. community-based or ‘Tier 2’ supports), and
(ii)
the future of the Information, Linkages and Capacity Building grants program;
(b)
The interfaces of NDIS service provision with other non-NDIS services provided by the States, Territories and the Commonwealth, particularly aged care, health, education and justice services;
(c)
The reasons for variations in plan funding between NDIS participants with similar needs, including:
(i)
the drivers of inequity between NDIS participants living in different parts of Australia,
(iii)
whether inconsistent decision-making by the NDIA is leading to inequitable variations in plan funding, and
(iv)
measures that could address any inequitable variation in plan funding;
(d)
How the NDIS is funded, including:
(i)
the current and future funding sources for the NDIS,
(ii)
the division of funding between the Commonwealth, States and Territories, and
(iii)
the need for a pool of reserve funding;
(e)
Financial and actuarial modelling and forecasting of the scheme, including:
(i)
the role of insurance-based principles in scheme modelling, and
(ii)
assumptions, measures, and methodologies used to forecast and make projections about the scheme, participants, and long-term financial modelling;
(f)
The measures intended to ensure the financial sustainability of the NDIS (e.g. governance, oversight and administrative measures), including:
(i)
the role of state and territory governments, and the Disability Reform Ministers Meetings,
(ii)
the arrangements for providing actuarial and prudential advice about the scheme, and
(iii)
the way data, modelling, and forecasting is presented in public documents about the NDIS, (e.g. NDIS Quarterly Reports and Reports by the Scheme Actuary), and
(iv)
measures to ensure transparency of data and information about the NDIS;
(g)
The ongoing measures to reform the scheme including:
(i)
the new early childhood approach, including whether or how early intervention and other supports intended to improve a participant’s functional capacity could reduce their need for NDIS funding, and
(ii)
planning policy for personalised budgets and plan flexibility; and
(h)
Any other related matters.
Conduct of the inquiry
1.7
This is the committee’s second report in the 46th Parliament for this inquiry. It examines new evidence provided to this inquiry since the tabling of the Current Scheme Implementation and Forecasting for the NDIS Interim Report (interim report) on 30 November 2021.
1.8
A summary of the interim findings, as canvassed in the interim report, is provided later in this chapter. The interim report considered submissions provided to the committee before 29 October 2022.
1.9
After the interim report was tabled, the committee reopened for a second round of submissions due by 28 February 2022.
1.10
In total, the committee received 92 public submissions. This includes 42 public submissions and 13 supplementary submissions provided after the tabling of the interim report. All submissions received are listed in Appendix 1 and are available on the committee’s webpage.
1.11
The committee also held three public hearings for this inquiry:
1 February 2022 via video and teleconference
28 February 2022 in Melbourne; and
2 March 2022 via video and teleconference.
1.12
Hearings were all conducted in accordance with appropriate arrangements for physical distancing during the COVID-19 pandemic.
1.13
Transcripts for the hearings, together with answers to questions on notice and additional information, are available on the committee’s webpage. Witnesses who appeared at the hearings are listed at Appendix 2.
Structure of this report
1.14
Chapter 1 (this chapter) details general information about this inquiry, provides background to the NDIS, and presents a summary of this inquiry’s interim report. It also provides a summary of key findings of the Productivity Commission’s 2017 Study Report into NDIS Costs, to set the context for the evidence received by this inquiry.
1.15
Chapter 2 discusses key matters relating to funding, forecasting and financial sustainability of the NDIS.
1.16
Chapter 3 examines the boundaries and interfaces of NDIS service provision and mainstream and community services. It also considers evidence relating to the Australian Government’s Information, Linkages and Capacity Building program.
1.17
Chapter 4 considers matters relating to trust, equity and decision-making in the scheme.
1.18
Chapter 5 looks at a range of other matters which were raised throughout this inquiry including recent government proposals for reform in the scheme.
1.19
Chapter 6 outlines the committee’s views on the matters discussed throughout this report, including recommended next steps.
Note on terminology and references
1.20
References to submissions are to individual submissions provided to the committee’s inquiry into current scheme implementation and forecasting, unless otherwise indicated. References to Committee Hansard transcripts are proof transcripts, unless otherwise indicated.
1.21
The committee also notes that some submitters and witnesses may refer to NDIS participants and other people with disability as ‘clients’ of particular services. This report may use the term ‘client’ when quoting from a submission or a hearing transcript. Otherwise, the report uses the terms ‘participant’, ‘person with disability’ and ‘people with disability’, with respect.
1.22
The committee acknowledges that there are a variety of terms used to reflect the diversity of Aboriginal and Torres Strait Islander cultures and identities. In this report, the term ‘Aboriginal and Torres Strait Islander peoples’ is used, with respect.
Acknowledgements
1.23
The committee thanks all those who contributed to the inquiry by lodging submissions, providing additional information or expressing their views via correspondence. The committee would also like to thank those who gave their time to attend the committee’s public hearings.
1.24
In particular, the committee acknowledges the people with disability, their families and carers who shared their experiences. The testimony of people with lived experience is crucial to identifying issues with the NDIS and improving the operation of the scheme.
NDIS Background
1.25
This section provides an overview of the NDIS, including key information relating to the scheme such as its legal framework, roll out, as well as its governance, oversight and other regulatory mechanisms.
National Disability Insurance Scheme
1.26
The NDIS is an insurance-based model for funding and supports for people with disability, families and carers. It replaces the previous state-based system of block funding with a 'fee-for-service', market-based approach.
1.27
The main component of the NDIS is individualised packages of funding to pay for supports for eligible people with disability. The scheme is based on the premise that people with disability each have different support needs and should be able to exercise choice and control in relation to their supports.
National Disability Insurance Scheme Act 2013
1.28
The NDIS is established under the National Disability Insurance Scheme Act 2013 (NDIS Act). The Act sets out the objectives of the NDIS, which include:
supporting the independence and social and economic participation of people with disability
providing reasonable and necessary supports, including early intervention supports, for NDIS participants
enabling people with disability to exercise choice and control in the pursuit of their goals and in the planning and delivery of their supports
facilitating the development of a nationally consistent approach to accessing, planning and funding of supports for people with disability; and
promoting the provision of high quality and innovative supports.
1.29
The NDIS Act further provides for how a person may become a participant in the NDIS; how plans are prepared and reviewed; how the NDIS approves funding; how an entity can become a registered provider of supports; and the process for reviewing decisions. The Act also requires that, in giving effect to the objects set out in the Act, regard is to be had, among other matters, to the need to ensure financial sustainability of the NDIS.
National Disability Insurance Agency
1.30
The National Disability Insurance Agency (NDIA) is the independent statutory agency responsible for the governance and administration of the NDIS. Its core functions include delivering the NDIS in a way that maximises choice and control for participants and promotes access to high quality supports, and managing, advising and reporting on the financial sustainability of the NDIS.
National rollout of the NDIS
1.31
The NDIS became operational on 1 July 2013 with the commencement of trial sites. National rollout of the scheme began on a geographic and age basis from July 2014, with the majority of jurisdictions beginning transition on 1 July 2016. National geographical rollout of the NDIS was completed on 1 July 2020, with Christmas Island and the Cocos (Keeling) Islands joining the scheme.
1.32
The transition to full scheme was guided by bilateral agreements between Commonwealth, state and territory governments.
1.33
As at 31 December 2021, the NDIS was providing services to 502 413 participants across Australia.
NDIS governance and oversight
NDIA Board
1.34
The NDIA Board is responsible for NDIS governance. The Board sets the NDIA’s strategic direction, ensures its compliance with statutory requirements, monitors performance and reports to the Ministerial Council (currently called the Disability Reform Ministers’ Meetings – see below), in accordance with sections 173 and 174 of the NDIS Act.
Disability Reform Ministers’ Meetings
1.35
The Act requires that a Ministerial Council is to consider policy matters that relate to the scheme or arise under the Act and advise the Minister about such matters. Disability Reform Ministers' meetings are the current Ministerial Council for the purposes of the Act. These meetings are held several times a year, to provide a forum for all Commonwealth, state, and territory ministers responsible for disability policy to drive national reform in disability policy, including through the National Disability Strategy and the NDIS.
Independent Advisory Council
1.36
The Independent Advisory Council to the NDIS (the Council) provides independent advice to the NDIS Board about how the NDIA is performing its functions, either at its own initiative or at the written request of the Board. The Council is comprised of 12 members who represent a wide range of disability and advocacy sectors who bring their own lived experience or expertise of disability.
1.37
The Council’s advice draws attention to important issues affecting NDIS participants, family and carers, and considers the way in which the NDIA is addressing such issues.
Annual reports
1.38
In accordance with the Public Governance, Performance and Accountability Act 2013 and the NDIS Act, the NDIA is required to provide an Annual Report, detailing the Agency’s performance and operations during that year.
1.39
The Agency’s Annual reports provide an overview of the progress of the NDIS for that year, as well as summaries of the organisation’s financial statements, information on financial sustainability, governance, risk management and workforce management. Previous and current Annual reports can be found on the NDIS website in various formats including ‘easy read’ versions.
Quarterly reports
1.40
Under section 174 of the NDIA Act, the Board of the NDIA is required to prepare a report on the operations of the Agency for each quarter, for provision to the Ministerial Council (Disability Reform Minister’s Meetings) by 31 January, 30 April, 31 July and 31 October each year.
1.41
The NDIA website states that its Quarterly reports ‘provide disability ministers with information (including statistics) about the participants in each jurisdiction and the funding or provision of supports by the NDIA in each jurisdiction’.
1.42
Broadly, the Quarterly reports contain information on participant plans and experience, service providers and the broader disability service market, the financial sustainability of the scheme and statistics regarding the characteristics of NDIS participants.
Other regulatory and oversight mechanisms
1.43
The NDIS Quality and Safeguards Commission regulates and registers NDIS providers and deals with complaints about quality and safety.
1.44
The Administrative Appeals Tribunal and the Commonwealth Ombudsman deal with appeals and complaints about NDIS decision-making.
Summary of interim report findings
1.45
As mentioned earlier in this chapter, the committee presented its interim findings for this inquiry on 30 November 2021.
1.46
In the initial tranche of evidence received, submitters raised a range of issues in response to the committee's terms of reference. Evidence included concerns about:
supports for people with disability outside the NDIS
the adequacy of the Information, Linkages and Capacity Building (ILC) program
interfaces between the NDIS and mainstream services
decision making in relation to access and planning decisions
actuarial and other data related to the NDIS; and
trust between the NDIA and people with disability.
1.47
Among other issues, the committee heard that:
There are inadequate supports available to people with disability outside of the NDIS and many people with a disability face barriers to accessing community supports that are available for a range of reasons including cost and poor accessibility.
The government’s ILC program is not yet providing the supports needed to address gaps in community-based supports.
Issues persist with managing the interfaces between the NDIS and ‘mainstream’ services offered by states and territories, with more cross‑sector coordination and integration between the NDIS and these services needed.
Inconsistent decision making by the NDIA and partners is contributing to inequitable outcomes for NDIS participants and people seeking to become participants.
Further transparency is required in relation to NDIS data, including actuarial data, and broader research and analysis of NDIS data should be undertaken by independent bodies.
Trust needs to be rebuilt between the NDIA and people with disability following the distress caused by the government's attempts to introduce independent assessments.
1.48
Submitters also highlighted the importance of ensuring that any reforms to the scheme are developed using genuine co‑design with people with disability, their families, and advocates.
Productivity Commission Study Report 2017 – NDIS Costs
1.49
On 19 October 2017, the Productivity Commission (the Commission) released a final study report on NDIS costs.
1.50
For the purposes of this inquiry, it is helpful to understand some of the key findings of the Commission’s 2017 report, to allow us to compare and contrast where the Scheme is at now, with updated evidence that this inquiry has received.
1.51
The 2017 report considered the trials and early rollout of the scheme, and showed that while, at the time, NDIS costs were broadly on track with the NDIA’s long term modelling, this was largely due to participants not using all the supports available in their plans.
1.52
The report highlighted that the scale, pace and nature of the changes that the NDIS was driving in its initial rollout were ‘unprecedented’, with consultations suggesting that the initial speed of participant uptake was of key concern, impacting on planning processes, the quality of plans, supporting infrastructure and market development.
1.53
The report called for governments and the NDIA to start planning for a slower intake of participants, and to ensure current non-NDIS support was not withdrawn too early. It also stated that greater emphasis on pre-planning, in‑depth planning conversations, reporting on the quality of plans, and more specialised training for planners was needed.
1.54
The report also highlighted that the interface between the NDIS and other disability and mainstream services remained ‘critical for participant outcomes and the financial sustainability of the scheme’.
1.55
The report noted that some disability supports were not being provided because of unclear boundaries about the responsibilities of the different levels of government and called for governments to set clearer boundaries at the operational level around ‘who supplies what’ to people with disability, and only withdraw services when continuity of service is assured.
1.56
Other key challenges identified in the report included developing support services needed under the scheme and growing the disability care workforce.
1.57
The 2017 Productivity Commission report will be discussed in further detail throughout following chapters of this report.