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As the government pushes for major changes to the NDIS, The Saturday Paper can reveal key figures in the scheme’s fraud and compliance division were also involved in the robo-debt fiasco. By Rick Morton.

Robo-debt public servants now shaping the NDIS

Prime Minister Scott Morrison with the new minister for the NDIS, Linda Reynolds.
Credit: Rohan Thomson / Getty Images

Two senior public servants involved in the establishment of the robo-debt program are now working in the compliance division of the National Disability Insurance Agency, with one making substantial comments on draft legislation that would overhaul the $25 billion support scheme and raise debts from participants.

The officials both left the then Department of Human Services after delivering the “online compliance initiative” that became known as robo-debt in 2016. One arrived at the NDIA six months after the other.

These public servants joined as the agency began a years’ long project of introducing a fraud strategy and sharpening internal tools that would more easily “detect and investigate serious fraud and non-compliance”.

While at first the fraud focus was on providers – including the first high-profile charges relating to a $400,000 rort by a sham provider in late 2018 – sources who were working in senior positions at the agency at the time told The Saturday Paper the target of the compliance matters began to shift “around the middle of 2019”.

“That’s when [the agency] turned their attention to participants in the scheme and whether they were being compliant,” one former high-ranking NDIA official says.

“It was a real change in the culture. All of these former Centrelink staff were in the agency by this point.”

The Saturday Paper revealed last week that proposed changes to the NDIS Act would give its governing agency the power to raise debts against disabled people for spending support funding on “ordinary living expenses” or even on services the Commonwealth minister decides should be paid for by state and territory governments. Under existing arrangements, debts can be raised in only very limited circumstances and rarely against participants with disabilities.

Tracked changes on the draft legislation, obtained by this newspaper, reveal an internal wish list of checks and balances that are aimed at containing costs within the scheme. One of these new sections is 46C, which effectively allows the Commonwealth minister to ban types of supports, including funding for state and territory services, without the veto of any other jurisdiction.

As one comment on the draft document, written by a former robo-debt official, puts it: “Funding not to be used for certain purposes – the clear reference [that] an amount spent in contravention of this subsection is a debt is a positive.”

On Section 182 of the proposed new act, which expands the debt-raising power, the same official remarks: “Provides clarity in terms of who the debt is against (the recipient who receives the money and does not spend in accordance with the Act).”

Following a critical Australian National Audit Office report in June 2019, the NDIA began work on reforming its apparent shortcomings.

In October of the same year, the agency advertised for an executive level 1 public service position – an assistant director – to work on compliance assessment matters.

“The Fraud and Compliance Branch undertakes business activities to increase confidence in the NDIS outlays and services by preventing, detecting and minimising fraud, exploitation and non-compliance while providing quality experience, for participants and providers,” the position description said.

“You will lead initiatives to identify opportunities to build better practices in fraud prevention and compliance through the ongoing design and review of contemporary compliance approaches [and] provide guidance and support to the branch around management and escalation of compliance issues, accounting for applicable legislation, processes and procedures.”

By March last year, the integrity branch released a compliance and enforcement framework aimed at addressing criticisms from the national audit office.

It trumpets the use of “data matching and analytics” in a new approach.

“The agency data matching activities are coupled with analytical capabilities and actuarial modelling, which allows the agency to identify high-risk activities, non-compliant participant plan usage and other potential areas of risk,” the plan says.

All of these tools are coming online, or have started already, and will have even more powerful legislative backing if the government gets its changes to the NDIS through the federal parliament.

As the senior official notes in the tracked changes: “The drafting of the rules of what is an ‘ordinary living expense’ or ‘goods or services specified in the rules’ should provide us with a basis for making determinations of non-compliance and remove some of the questions of what is allowable / not allowable with the removal of the term ‘reasonable and necessary’.”

A colleague in another part of the agency raised concerns about the expanded debt power because, as with robo-debt’s essential flaw, it shifts the onus onto participants in the system. In this case, it forces disabled people to display a depth of understanding about the complex interactions of the NDIS that not even the nation’s top bureaucrats have been able to wield over the past eight years.

“Could Deb also please be included for targeted consultation on this section too, noting the critical link to 46C?” one agency official asks in notes on the document.

“This section might need some unpacking to understand how these changes could play out practically. We know that many participants and their families, even where they are engaged advocates, do not understand or have visibility of where one service system ends and another begins – particularly in grey areas (education and health are the key ones in my experience).

“A potential real life example could include a child care provider who has deregistered from mainstream childcare funding, and registered as an NDIS provider delivering childcare under a more generous NDIS fee structure.”

Elsewhere in the draft document, some of the most senior scheme officials recommended removing the word “co-design” from a clause in the act which says people with disabilities should be included in its drafting.

“Does this need to be in the Act? What will this mean in actual practice? Legislating co-design could cause issues down the track with key policy and practice changes.”

There is another big reveal buried in the comments by agency staff on the draft legislation. Despite publicly and privately saying that the federal government does not need to amend the NDIS legislation to introduce a regime of “independent” functional assessments, internal queries on the document suggest otherwise.

Staff have added a section that “requires” people with disabilities to hand over assessment documents before gaining entry to the scheme – rather than the previous wording “request”. The new clause gives the scheme’s chief executive the power to insist that those assessments be undertaken by independent assessors.

“Does this provide strong enough cover for us to direct the participant to the assessors on our panel? Or could they choose their own and still satisfy?” a senior executive asks in the comments.

The point is so important it is reiterated elsewhere in the draft by the same executive: “Assume this provides enough cover (i.e. is strong enough) for us to determine who provides the assessment under 1 (b), and they cannot choose to undergo an assessment by a provider of their own choice.”

Despite apparent concerns it needs legislative backing, the NDIA is pushing ahead with its program to mandate outsourced functional assessments of participants before the exposure draft is released.

This is part of a larger reform of NDIS processes, which is being called “robo-planning”. The scheme-wide change will mean a person no longer gets to request items of support to meet their goals. Instead, functional scores from external assessors will be generated by a computer algorithm, combined with the participant’s age and limited “environmental” or social factors, such as availability of unpaid family care. This software program will decide a “personalised budget” before a disabled person sees an agency planner. Once this has been decided, there is little room for revision or adjustment. Individualised planning will be a thing of the past.

Staff within the agency were sent a memo last week that confirmed the “robo-planning” changes that are tied to these assessments.

“Plans will go from being built ‘bottom up’ – with line by line R&N [reasonable and necessary] supports being negotiated individually – to being formulated ‘top down’ as total plan budgets or Personalised Budgets (PB’s),” the memo says.

“This prevents participants who are more articulate, confident and / or better represented from getting larger plan budgets than those who are not – as we know happens today.

“There will still be opportunities for delegates to vary PBs where this is warranted, but we’ll anticipate that most PBs will be appropriate as formulated. Simplicity comes from the total top down PB package rather than individual supports.”

Taken together, these changes fundamentally alter the NDIS. Like changes to the unrelated Disability Support Pension, this flagship disability scheme is changing from a service to a reluctant offer. Those who receive it will be scrutinised with a latent mistrust or misunderstanding of their myriad conditions.

Rather than achieve consistency by training planners within the scheme, the NDIA will introduce a cookie-cutter framework that will ultimately reduce access to services required by individual needs.

As Labor’s spokesman on the NDIS, Bill Shorten, describes it: “Agency leaders are going to ration the scheme and tell people with disabilities to shut up and be grateful.”

This article was first published in the print edition of The Saturday Paper on Apr 10, 2021 as "Robo-debt public servants now shaping the NDIS".

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Rick Morton is The Saturday Paper’s senior reporter.