Referral of inquiry and terms of reference
The Joint Standing Committee on the National Disability Insurance Scheme
(NDIS) was established on 1 September 2016. The committee is composed of five
Members and five Senators.
The committee is tasked with inquiring into:
- the implementation, performance and governance of the NDIS;
the administration and expenditure of the NDIS; and
such other matters in relation to the NDIS as may be referred to it by
either House of the Parliament.
After 30 June each year, the committee is required to present an annual
report to the Parliament on the activities of the committee during the year, in
addition to other reports on any other matters it considers relevant.
The committee is also able to inquire into specific aspects of the
Scheme. On 21 June 2017, the committee decided to undertake an inquiry into the
transitional arrangements for the NDIS.
The terms of reference for the inquiry are as follows:
As part of the committee’s inquiry into
the implementation, performance and governance of the NDIS, the committee will
inquire into and report on the transitional arrangements for the NDIS, with
particular reference to:
boundaries and interface of NDIS service provision, and other non-NDIS service
provision, with particular reference to health, education and transport
consistency of NDIS plans and delivery of NDIS and other services for people
with disabilities across Australia;
rollout of the Information, Linkages and Capacity Building Program; and
- any other
In considering these issues, the committee will have regard to:
the Bilateral Agreements between the Commonwealth and State and
Operational Plans between the Commonwealth and State and Territory Governments;
- the risks borne by the
Commonwealth and State and Territory Governments in the rollout of the NDIS
- NDIS decision-making
processes, particularly in relation to the Disability Reform Council and COAG;
impact on rural and remote areas, with particular reference to Indigenous
This report is comprised of four chapters, as follows:
This chapter (chapter 1) outlines the context and administration
of the inquiry and provides some background information about the transitional
arrangements to full Scheme;
Chapter 2 examines the boundaries and interface of NDIS service
provision and mainstream services;
Chapter 3 focuses on the impediments to delivery of appropriate
and timely services and the rollout of the ILC to date; and
Chapter 4 discusses the issues of thin markets and Provider of
Last Resort arrangements as well as emerging gaps in services. The chapter also
explores the challenges faced by people from CALD backgrounds and Aboriginal
and Torres Strait Islanders in engaging with the NDIS.
Conduct of the inquiry
The committee received 82 submissions to the inquiry from individuals
and organisations. These submissions are listed in Appendix 1.
The committee also conducted eight public hearings:
19 September 2017 in Melbourne;
21 September 2017 in Darwin;
26 September 2017 in Brisbane;
27 September 2017 in Adelaide;
3 October 2017 in Sydney;
4 October 2017 in Hobart;
20 October 2017 in Canberra; and
8 November 2017 in Melbourne.
Transcripts from these hearings, together with submissions and answers
to questions on notice are available on the committee's website. Witnesses who
appeared at the hearings are listed in Appendix 2.
The committee would like to thank the individuals and organisations that
made written submissions to the inquiry, as well as those who gave evidence at
the eight public hearings. We are grateful for their time and expertise.
Note on terminology and references
References to submissions in this report are to individual submissions
received by the committee and published on the committee's website. References
to Committee Hansard are to official transcripts.
Agreements between the Commonwealth
and State and Territory governments
The Intergovernmental Agreement (IGA) for the NDIS Launch was signed by
the Commonwealth and all states and territories at the Council of Australian
Governments (COAG) meeting on 7 December 2012. The purpose of the IGA was to
provide the foundation for governments to work together to develop and
implement the first stage of an NDIS.
The IGA and its six annexes were the basis of a number of provisions in
the NDIS Act 2013 and for Bilateral Agreements for Transition to a NDIS.
The full Scheme Heads of Agreement for each state and territory outlines
the parameters for transition to full Scheme within specific timelines, full
Scheme funding arrangements, and scope of the National Injury Insurance Scheme
(NIIS). Heads of Agreements for full Scheme were signed bilaterally with each
jurisdiction (except WA) during 2012 and 2013 to set out a commitment and broad
parameters for full Scheme.
On 16 September 2015, the Prime Minister, the Hon Malcom Turnbull,
signed bilateral agreements with the NSW and Victorian Premiers for the
transition to the NDIS. Transition began July 2016, with a geographical rollout
moving from region to region, covering all eligible people under 65, over two
years in NSW and over three years in Victoria. These agreements formed the
basis for consistent arrangements with other states and territories.
On 11 December 2015, the Prime Minister, the Hon Malcom Turnbull, signed
bilateral agreements with the Tasmanian and South Australian Premiers for the
transition to the NDIS. Transition began in both jurisdictions in July 2016
with an implementation on an age basis over three years for Tasmania
and an implementation through a mix of ages and geographic location, based on
South Australian Disability regions for South Australia over two years.
On 16 March the bilateral agreement was signed with Queensland with
transition beginning in July 2016 on a geographical basis over three years.
On 5 May 2016; the bilateral agreement with the Northern Territory (NT)
was signed with transition beginning in July 2016 on a geographical basis over
Unlike other jurisdictions, Western Australia (WA) trialled two service
delivery models (WA NDIS and NDIA NDIS) from July 2014 to June 2016. Following
the trial, an independent evaluation of the two models was conducted by
Stantons International. Subsequently, in January 2017, a more bespoke Bilateral
Agreement was agreed by the Commonwealth and West Australian Governments which
resolved that a nationally consistent but state-run NDIS would be implemented
in WA with transition to commence from July 2017.
More recently, on 12 December 2017, the Australian and Western
Australian Governments reached agreement to bring Western Australia into the
NDIS. The Agreement replaces the agreement signed in January 2017 by the
previous Western Australian Government for a WA administered NDIS. From 1 July
2018, the National Disability Insurance Agency will assume responsibility for
the delivery of the NDIS in WA. The NDIS will continue to roll out on a
geographic basis and will be fully rolled out across Western Australia by 2020.
The Australian and Western Australian governments will work closely with the
National Disability Insurance Agency to implement the transition.
Features of the bilateral
The bilateral agreements set out the roles and responsibilities for the
transition to full coverage of an NDIS. Schedules to the agreements include
sections on: Participant Transition Arrangements; Financial Contributions;
Cross billing and Budget Neutrality Arrangements; Continuity of Support
Arrangements; Sector and System Readiness; Quality and Safeguards; Performance
reporting; Workforce; Mainstream Interfaces; and Supports for Specialist
In the case of the NT the bilateral agreement also includes schedule K
on the arrangements for a provider of last resort services during transition.
This schedule was added because of the significant risk of service failure
where there are thin or non-existent markets, including limited supply and very
low demand for services. The NDIA is the responsible entity for ensuring
provider of last resort services are in place for all Participants in the NT.
Under the agreements, the Commonwealth will fund 40.4 per cent of
package costs for Participants aged 0-64 (0-50 years for Indigenous Australian
Participants) in the Scheme, operational costs, Information Linkages and
Capacity Building, and agreed overruns. States and Territories will fund 59.4
per cent of package costs for Participants aged 0-64 (0-50 for Indigenous
Risks borne by the Commonwealth,
State and Territory governments in the rollout of the NDIS
The Commonwealth funds 100 per cent of the risk of any increase in costs
associated with higher participant numbers and / or higher average per person
care and support costs, and 100 per cent of the NDIA's cash flow risk, during
Arrangements at Full Scheme
The Commonwealth will assume 100 per cent of the risk for full Scheme
subject to the review of Scheme costs by the Productivity Commission in 2017.
The Heads of Agreements state the Productivity Commission would
undertake a review of Scheme Costs in 2017. This review is intended to inform
the final design of the Full Scheme, prior its commencement.
Early 2017, the Productivity Commission started the NDIS Costs review
and released its final report on 19 October 2017.
In its media release dated 19 October 2017, the Government stated:
(...)The Government will work with the National Disability
Insurance Agency (NDIA), States and Territories to consider and respond to the
findings and recommendations of the Report.
The Government notes the Commission's findings that Scheme
costs are broadly on track compared to the NDIA's long term modelling and the
support offered by the Commission for the NDIAs approach to projecting Scheme
costs. The Government also acknowledges there are emerging cost pressures,
which are being appropriately monitored and addressed.
The Government acknowledges the number of people entering the
NDIS is less than originally estimated. This experience has been absolutely
consistent during the NDIS trials and since commencement of transition to full
Scheme on 1 July 2016.
National rollout of the NDIS, participant
intake and plan activation
The Australian Capital Territory was the first jurisdiction to complete transition
to the Scheme, and this was largely achieved by the end of the second quarter
The rollout is expected to be completed progressively, with New South
Wales and South Australia by July 2018; Victoria, Queensland, Northern
Territory, and Tasmania to be completed by July 2019 and Western Australia by
As at 30 September 2017, 111 188 Participants had an approved plan and a
further 29 315 people were eligible with no approved plan.
Table 1.1—NDIS state and territory Participants with
approved plans compared to bilateral agreement estimates of Participant intake
with approved plans at 30 September 2017
|Participants with approved plans
|Bilateral agreement estimates
The Productivity Commission found that the current timetable for participant
intake will not be met.It
The intake of Participants with approved plans is already
falling behind the expected pace. If the trend of delivering about 80 per cent
of the bilateral estimates continues, it will take an additional year before
all eligible Participants are in the Scheme. (And this delay could be longer if
the Scheme falls further behind when the participant intake ramps up in 2017–18.).
In its submission to this inquiry, the Queensland Government noted:
Unfortunately, the NDIA has transitioned significantly fewer
Queenslanders to the NDIS than the bilateral agreement's estimates.
Similarly, the Victorian Government stated:
Victoria has experienced significant delays in bringing
Victorian Participants, particularly existing state clients, into the Scheme
against bilateral agreement estimates.
The Productivity Commission recommended that 'the Australian, State and
Territory Governments should immediately start planning for a changed timetable
for participant intake for the NDIS' and added:
In doing so, the Australian, State and Territory Governments
should ensure that adequate continuity of support arrangements are in place and
assess whether additional resources are required to ensure the scheme meets its
objectives. The issue of resourcing disability services under the changed
timetable should be dealt with by the Treasurers and Ministers responsible for
the disability portfolio in each jurisdiction, at the next COAG Disability
Reform Council meeting.
The NDIA reported that 'approximately 71% of plans approved in 2016-17
have been activated within 90 days of plan approval'.
The NDIA, as part of the Participant Pathway Review, is undertaking work
to accelerate plan activations, with the view to reduce the length of time
between plan approval and the commencement of support.
The Productivity Commission found that 'based on trial and transition
data, NDIS costs are broadly on track with the NDIA’s long-term modelling, but
this is in large part because not all committed supports are used'.
The Productivity Commission reported that the NDIA has identified five
early cost pressures that need to be managed for the full Scheme going forward.
The number of children entering the Scheme is higher than
The number of people approaching the Scheme in trial sites that
have been operating the longest (since 2013) is higher than would be expected
if only people with newly acquired conditions were approaching the Scheme.
The number of Participants exiting the Scheme is lower than
expected (particularly for children entering under the early intervention
Levels of committed support tend to increase as Participants move
to their second and third plans (over and above the impacts of inflation and
There is greater than expected variability in package costs for Participants
with similar conditions and levels of function (suggesting inconsistencies in
The NDIA's two main responses to emerging cost pressures are the Early
Childhood Early Intervention (ECEI) approach for children aged 0-6 years and
the use of reference package data in the planning process to reduce variability
in the level of support provided to Participants.
The Productivity Commission concluded:
While it is too early to conclusively assess the
effectiveness of these initiatives, there are some signs from 2016-17 data that
the new planning process may be helping to alleviate cost pressures related to
Navigation: Previous Page | Contents | Next Page