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The Parliamentary Joint Standing Committee on the National Disability
Insurance Scheme ('the committee') was established on 2 December 2013 following
the passing of a resolution in the Senate and the House of Representatives. The
committee, composed of six Members and six Senators, is tasked with reviewing
the implementation, administration and expenditure of the National Disability
Insurance Scheme (NDIS).
The committee's establishing resolutions require the committee to
present an annual report to the Parliament after 30 June each year on its
activities during the year. The resolutions direct the committee to include in
its report reference to the National Disability Insurance Agency (NDIA) Board's
quarterly reports to the Ministerial Council and the Board's Annual Report to
the Standing Council on Disability Reform.
Section 172 of the National Disability Insurance Scheme Act 2013
('the Act') requires the NDIA Board to provide an Annual Report on the NDIA's
activities to the Minister and the Ministerial Council. Section 174 of the Act
requires the NDIA Board to prepare a report on the operations of the NDIA for
each period of three months starting on 1 July, 1 October, 1 January and 1
The first 12 months
This is the committee's first report to the Parliament. Although it
comes only eight months after the committee was established and before the
first NDIA Annual Report, there has been a considerable amount of activity on
which to report progress over the past year:
since 1 July 2013, four States—New South Wales, Victoria, South
Australia and Tasmania—have operated NDIS trial sites;
the NDIA Board has provided three quarterly reports to the
Ministerial Council presenting data on the progress of these trial sites, and
is due to present the final quarterly report for 2013-14 as well as its
inaugural first report to the Minister and the Ministerial Council in the
the committee has visited the four trial sites and conducted
meetings with NDIA staff, state and federal officials, key stakeholders and
service providers, and NDIS participants, their carers and family members;
three other jurisdictions have also launched new NDIS trial
sites. On 1 July 2014, Western Australia, the Northern Territory and
the Australian Capital Territory commenced NDIS trials. As with the other
States' trials, the WA and NT sites are geographically focused. The ACT, on the
other hand, is the first site to operate the Scheme across the whole
jurisdiction for all age groups up to 65 years;
the committee has yet to discuss or visit Western Australia, Northern
Territory or the Australian Capital Territory to examine the implementation of
their NDIS trial sites; and
in terms of the administration of the Scheme, the NDIA has
managed significant change since its launch only 12 months ago; its
headquarters were moved from Canberra and officially opened in Geelong on 29
April 2014. There has also been significant activity within the Agency in terms
of recruiting staff, developing information technology to support the Scheme
and internal administrative processes including devising material to inform the
Australian community on the progress and operation of the Scheme.
The committee's report to the Parliament
In compiling the committee's report to the Parliament, the committee is
mindful of the nature of the advice provided to the Parliament and the Agency.
The committee has listened to many stakeholders and is aware of the significance
of the task ahead for the NDIA, governments, the disability sector and the
whole community. The evidence identifies challenges facing a wide cross-section
of organisations and stakeholders. As Mr Kurt Fearnley, a member of the
Independent Advisory Council, told the committee at the conclusion of the
participants' section at the public hearing in Newcastle:
The challenges that we have been listening to today have
been, in my opinion, extremely positive. I think there are challenges for the
NDIA, and I would like to stress my support and admiration for what they are
doing. I think it is a challenging job for them, it is a challenging job for
people with disabilities, it is challenging for DSPs, it is challenging for
carers and families, but that is kind of the purpose. The NDIS was brought
around to challenge people so that we could decide what level of life was going
to be lived for people with disabilities.
The committee's intent in outlining these various challenges is to
assist the Agency, all governments, stakeholders and the wider Australian
community to understand the nature and the complexity of these challenges as
identified by various witnesses and to address them effectively.
The composition of the committee
On 21 November 2013, the Senate and House of Representatives appointed
the following members to the committee:
the Hon. Mal Brough MP (Liberal Member for Fisher, Queensland);
Senator Alex Gallacher (Labor Party, South Australia);
Dr David Gillespie MP (National Party, Member for Lyne NSW);
Ms Jill Hall MP (Labor Member for Shortland, NSW);
the Hon. Jenny Macklin MP (Labor Member for Jagajaga, Victoria);
Senator Bridget McKenzie (National Party, Victoria);
the Hon. Amanda Rishworth MP (Labor Member for Kingston, South
Mr Wyatt Roy MP (Liberal Member for Longman, Queensland);
Senator Zed Seselja (Liberal Party, Australian Capital
Senator Rachel Siewert (Australian Greens Party, Western
Senator Dean Smith (Liberal Party, Western Australia);
Senator the Hon. Ursula Stephens (Labor Party, NSW);
On 3 December 2013, the committee elected Mr Mal Brough as Chair and
Senator Alex Gallacher as Deputy Chair.
The committee membership has undergone a number of changes during its
first eight months. In March 2014, Victorian Nationals Senator Bridget McKenzie
was replaced on the committee by Queensland Nationals Senator Barry O'Sullivan
and, Queensland Liberal, Mr Wyatt Roy MP was replaced on the committee by West
Australian Liberal, Mr Steve Irons MP. New South Wales Labor Senator the Hon.
Ursula Stephens retired from the Senate on 30 June 2014. She has been replaced
on the committee by Tasmanian Labor Senator Anne Urquhart. On 1 July 2014, West
Australian Liberal Senator Dean Smith and Queensland Senator Barry O'Sullivan
both left the committee and were replaced by Queensland Nationals Senator
Matthew Canavan and West Australian Liberal Senator Linda Reynolds CSC.
The committee's activities
The committee has been active visiting trial sites and discussing
operational matters with the NDIA, the NDIA Board, the NDIS Independent
Advisory Council, the Scheme Actuary and the relevant State government
officials and NDIS service providers, participants, families and carers.
The committee met 23 times over the period 2 December 2013 to
24 July 2014. Of these, 13 were private meetings held each Wednesday
of the joint parliamentary sitting weeks. While the details of these
proceedings are confidential,
the committee can report that it used private meetings in March and July 2014
to conduct briefings with the NDIA and its Board (see chapter 6), state
government officials and key stakeholders. The committee extends its thanks to
all those who attended these briefings.
NDIS trial site visits
During April and May 2014, the committee travelled to all four trial
sites. Commencing with the Barwon trial site in Geelong, Victoria followed by
Tasmania and in May, the committee visited the Hunter trial site in Newcastle,
NSW and Adelaide, South Australia. Appendix 1 of this report provides a list of
the people and agencies with whom it met.
The committee advertised its intention to conduct hearings over two days
at each trial site through the national and relevant local media. The
Parliamentary website also provided further advertising of the hearings and
provided access for a registration process that was managed by the committee
At each site the committee spent two days taking evidence. On day one,
the committee took evidence from NDIS participants, carers and family members,
service providers and peak bodies. On day two, the committee met with state
officials and NDIA state managers.
The committee would like to thank the NDIA for its assistance in
advertising the hearings, its staff's attendance and for providing a carer at
each hearing to assist attendees.
The committee's focus
In preparing this report, and in conducting its activities, the
committee is mindful of what it is tasked to do and the responsibilities of
those who administer and implement the Scheme.
The committee has decided that this inaugural report will concentrate on
the following issues:
the implementation of the first four trial sites in terms of the
transitional arrangements at each location;
the Agency's processes in developing the operational arrangements
to administer the Scheme and assist the planners;
the planning process;
the associated issues that impact on the individual experiences
of participants, carers, families and service providers; and
the role of the Scheme Actuary whose role it is to ensure that
the NDIS is financially sustainable.
The committee is of the view that the
tabling of an interim report at the earliest opportunity would be of most
benefit to the successful implementation and ongoing development of the Scheme.
In addressing the committee's future work plan, the committee will focus
on a range of key issues that are integral to the continuing launch and
subsequent full rollout of the NDIS. These may include, but are not limited to:
workforce capacity; contestable market sector; gaps in services delivery;
training of individuals to work in the disability sector such as allied health
workers and training of people who live with a disability to participate in the
workforce; supply of adequate and appropriate housing; the supply of specialist
equipment; managing complex and high needs; the provision of Tier 2
services; the provision of mainstream services, such as health and education;
and community capacity building.
Structure of this report
This report is divided into the following chapters that follow the
committee's hearings at the NDIS trials site in order of event.
Chapter One provides some context and background information
about the development, structure and implementation of the NDIS;
Chapter Two provides evidence from the Barwon trial site;
Chapter Three provides evidence from the Tasmanian trial site;
Chapter Four provides evidence from the Hunter trial site;
Chapter Five provides evidence from the South Australian trial
Chapter Six provides discussion on the role of the NDIA, the NDIS
and the committee's conclusions and recommendations.
The context of this report
The following section provides an overview of the background of the
NDIS, particularly the underlying national policy settings and agreements
regarding the individual roles and responsibilities.
Genesis of the NDIS –what has been
The NDIS represents the biggest social reform in Australia since the
introduction of Medicare in 1984. Like Medicare, the NDIS has broad-based
parliamentary and community support. Both are also Commonwealth funded
insurance schemes that provide the Australian population entitlement to
services based on need.
Dr Bruce Bonyhady, Chairman of the NDIA describes the Scheme in the
The Scheme has the support of all governments and all
political parties as it tackles the greatest shortcoming in our country’s
social services system – a broken system in which the essential needs of those
with a significant disability are only about one-half met and which the
Productivity Commission in its landmark report in 2011 infamously described as
‘underfunded, fragmented, inefficient and giving people little choice’...
...Across Australia, disability spending by governments has
been growing at 7% to 8% in real terms since the late 1990s, but this growth
has not kept pace with growth in demand. 
Dr Bonyhady states that against this background a ‘perfect storm’ grew
consisting of: an ageing baby boomer population of parents; increasing female
participation in the workforce, and reduced family sizes impacting the
available “stock” of family carers. This included the emerging dynamic of ageing
parents forced to relinquish an ageing son or daughter with disability; emergency
response funding is required from the state disability services resulting in a
‘death spiral’ where funding in an already rationed system is used for
emergencies and there is no support provided for lower urgency cases–increasing
risk of further crises in the future in the jurisdiction's health and
disability funding systems. 
This would result in existing disability services across jurisdictions being
constantly stretched to their limits leading to what the Productivity
Commission referred to as a 'lottery' of access to services.
Without the NDIS, people with disability, their carers and families will
not get certainty of supports in their lives, further marginalising and
reducing their wellbeing and participation in society.
Critically, the importance both socially and economically of governments
agreeing to take an active role to establish a social insurance model to deal
with issues like healthcare or permanent disability is fundamental to mitigate
this form of market failure where no private solution would ever come to
The NDIS commenced operation in four trial sites on 1 July 2013: the
Barwon Region in Victoria, Hunter Region in New South Wales, Tasmania and
The development and implementation of the NDIS was preceded by:
a series of national multilateral agreements starting in the
in 1991, the first Commonwealth State Disability Agreement
(CSDA) was signed; 
three successive multilateral agreements followed, each covering
a five year period (later these agreements were the Commonwealth State/Territory
Disability Agreement (CSTDA)); 
an inquiry undertaken by the Senate Standing Committee on
Community Affairs on the funding and operations of the past three CSTDAs
(report tabled in February 2007); 
commitment from the Council of Australian Governments (COAG) to a
fourth agreement (effective from 1 January 2009), the National Disability
Agreement (NDA); 
agreement by COAG to develop a ten year strategic policy
framework— National Disability Strategy 2010-2020 ('the Strategy');
a report from the Productivity Commission on their investigation
into the feasibility of new approaches for funding and delivering long-term
disability care and support (PC Report) (final report presented in August
In March 2013, the NDIS legislation passed with bipartisan support in
the Parliament and the National Disability Insurance Scheme Act 2013 was
created, along with the Scheme and the NDIA.
During the development of the NDIS, there was universal acceptance that
the then current system was not working and was not providing adequate funding,
care and support for people with disability. Many people with disability were
unable to access the supports they required.
NDIS governance structure
While the committee has yet to go into the governance relationships of
the NDIS, Figure 1.1 below provides the reader with a schematic of the
interactions involved in the NDIS' governance structure. This schematic does
not include the further layer of interactions of the Senior Officials Working
Group, the Design Policy Group and the Funding and Governance Working Group.
Figure 1.1 NDIS governance structure
Who is the NDIS for?
Based on the PC report, the NDIS has been established on the PC model
comprising three tiers. There are three different populations of ‘customers’
and costs—with the costs inversely related to the size of the populations
Figure 1.2 The three tiers of the National Disability Insurance Scheme
2009 population estimates
The PC report provided the following explanation for Tiers 1-3 and what
each is expected to consist of:
Tier 1: Everyone— every Australian, since it provides
insurance against the costs of support in the event that they acquire a
Tier 2: People with, or affected by, disability but not
covered by the NDIS;
Tier 3: People with disability for whom NDIS-funded,
individualised supports would be appropriate:
...[T]he critical entry requirements focus at those most in
need. A person receiving funded support from the NDIS would have a disability
that is, or is likely to be, permanent. The definition of ‘permanence’ would
include people with long-term functional limitations who may only need episodic
support. In addition, people would have to meet at least one of the following
conditions. They would:
have significantly reduced functioning in self-care,
communication, mobility or self-management and require significant ongoing
support (3a). As a result, the scheme would cover the support needs of people
with major physical disabilities and cognitive impairments (mainly intellectual
disability and significant and enduring psychiatric disability)
be in an early intervention group (3b). This would encompass
people for whom there is good evidence that the intervention would be safe,
cost-effective and significantly improve outcomes.
The majority of participants eligible for the Scheme will all come from
‘Tier 3’ — those receiving funded supports.
There is support across the political spectrum for the NDIS and its
overarching aim of enhancing the quality of life and the economic and social
participation of Australians with disability.
There is also broad-based support to fully develop the Scheme's market-based
mechanism which aims to provide greater choice and control for participants.
There are a number of critical elements envisaged by the PC that have
yet to be examined by the committee that will play increasingly significant
roles as the Scheme develops and transitions more participants, such as
mainstream services, Tier 2, training, staffing, provider capacity and the
community engagement and capacity building.
Examination of these issues together with assessing the implementation
of the new NDIS trials sites in Western Australia, Northern Territory and the
Australian Capital Territory, that commenced operation on 1 July 2014, and
monitoring the existing trial sites, will be central to the committee's work
plan over the next 12 months.
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