The NDIS is on the brink of its biggest-ever restructure, and people in the disability community are concerned that the earliest reforms in a sweeping agenda may leave many who rely on the service unsupported. By Rick Morton.

The hidden risks in the NDIS restructure

National Disability Insurance Scheme Minister Bill Shorten.
National Disability Insurance Scheme Minister Bill Shorten.
Credit: AAP Image / Mick Tsikas

A mammoth effort to rescue the $42 billion-a-year National Disability Insurance Scheme by revisiting abandoned or undelivered proposals from the original 2011 blueprint will begin within weeks, and the speed of proposed reform has unnerved the disability community.

As key ministers plan changes to legislation and policy, many who rely on the scheme are still digesting a 1300-page analysis document attached to the NDIS Review and released three weeks before Christmas. It recommended an overwhelming and finely tuned schedule of change.

The NDIS Review was completed in October last year by scheme “grandfather” and its first chair, Bruce Bonyhady, alongside former Department of Education secretary Lisa Paul. It arises from extensive consultation with people with disability, their family and providers, and though it is principally concerned with the future of the insurance scheme, its sweeping diagnosis touches almost every corner of every level of government in Australia.

Broad though it is, much of the blueprint relies on good-faith agreements to change longstanding rules and legislation in a specific order. If these changes restrict access to the NDIS without an adequate buffer of external support, even more people will miss out on crucial help.

In a rare early win for the federation, all states and territories have agreed with the Commonwealth to fund and work together on a plan for “foundational supports”, a suite of low-intensity disability services that are proposed to form an outer mantle around the NDIS and protect it from being “an oasis in a desert”.

These supports were once envisaged as “Tier 2” in the original 2011 design of the scheme but they never fully materialised.

Advocates in the disability community fear that if some reform elements are rushed before others are ready, they could do more harm than good.

Disability Advocacy Network Australia (DANA) chief executive Jeff Smith welcomes the agreement from national cabinet to share funding for foundational supports and the agreement for states and territories to contribute more to the NDIS, saying both are “essential features of what makes this reform different, and possible”. However, he says, “it is critical that there aren’t changes in essential NDIS support for people with disability while foundational supports are being developed. Disability supports are life-saving and life-changing for people with disability and it is vital that this reform is done with us, not to us.”

The NDIS Review enunciates critical issues with the landmark disability scheme that have been evident – though repeatedly publicly denied – since trials began in 2013. They have only become more pressing since.

What the review doesn’t do is provide much in the way of explicit solutions. Instead, broad concepts are offered, with governments expected to commission yet more research, more reviews and more deliberation to flesh out precisely how these concepts will be implemented.

NDIS planning will be replaced with agency staff or contracted “needs assessors”, but the assessments they will use, how long these will take and how the “significant workforce transformation” that’s required will actually happen is not yet agreed. Similarly, an ongoing bugbear of the current system is that despite efforts that began in 2013 and were essentially abandoned in 2015, Commonwealth, state and territory governments still cannot agree on the interaction between the NDIS and other “mainstream” services in schools, hospitals and forensic facilities, for example. These jurisdictions have now been ordered back to the drawing board to figure out a new way of solving the same problem.

“The framework which governs the relationship between the NDIS and other service systems … has failed,” the review says.

“It is based on the idea that there is a hard line between the NDIS and other systems. Despite its intent, it has led to seemingly endless arguments about who does what and who pays for it.”

Despite appearances, these mainstream supports are separate from the critical development of the new foundational supports, for which Albanese has already secured agreement. Those services just never arose, despite being key to the Productivity Commission’s 2011 report that designed the NDIS. In some cases, programs that pre-dated the NDIS were axed upon its introduction and the money absorbed into a single bucket for fewer people.

“The result is that many people with disability apply for and stay in the NDIS for fear of lack of support outside of it, even when supports outside the NDIS may be more appropriate,” the review says.

“People who cannot access the scheme are missing out on vital supports and services, increasing future needs. Both result in poor outcomes for people with disability. They also put financial stress on the NDIS and threaten its sustainability.”

The agreement the Albanese government secured from all jurisdictions in national cabinet last month to develop and fund foundational supports will not relieve all of that stress. It is at a capped cost of $10 billion over the next five years, and increases state and territory funding to the NDIS itself, doubling the rate of “escalation” currently baked into agreements, from 4 to 8 per cent by 2028.

In return, however, states and territories received an extension to a plump GST share arrangement that was due to expire and a substantial boost to health funding agreements worth billions collectively. There has been no agreement yet on the intersection between child protection, justice, hospitals, palliative care, mental health, school education, transport or aged care.

“Despite being the subject of repeated calls for change over the last 10 years, the problems remain significant,” the review notes.

The tension between an “uncapped” system in the NDIS meeting “rationed” service systems outside of the scheme combined with broad provisions in the NDIS legislation have contributed to a situation where jurisdictions squabble over funding and push people towards the NDIS. With much more permissive legislation, the National Disability Insurance Agency (NDIA), responsible for running the scheme, made a habit of jamming on the brakes, denying funding and forcing people with disability through a byzantine review system that it fights with top-tier barristers until, almost always, settling at the last hurdle.

The Administrative Appeals Tribunal (AAT) frequently finds against the NDIA because of the same broad legislation that saw it use the tribunal as a stalling mechanism. And on the cycle has gone, for years. People with disability have been the victims of this bureaucratic maze, punished by the inability of governments to agree on the full universe of disability support demanded by the scheme designers.

In future, the NDIS Review says, there must be an “active feedback loop between policy, legislation, operational guidelines and merits review” that is monitored by the Disability Reform Ministerial Council.

“Where the AAT or other courts make findings that shift the boundaries between the NDIS and other service systems, governments … need to assess whether they accept this change and update the multilateral schedule, MoUs [memoranda of understanding] and operational guidance or introduce new legislation or rules,” the review says.

A persistent issue raised by the NDIS Review is that so much of what is now in operation has arisen without the input or even consideration of people who use these services. This is especially true for those who have psychosocial disabilities, never quite “belonging” in the NDIS but cut out of much external support.

Regulating the explosion of new services and providers, as many people with disability in the NDIS received choice and control for the first time in their lives, has proved to be an extraordinary challenge.

Well over half of the recommendations in the final review, and 27 of the 139 “supporting actions”, relate to the current NDIS Quality and Safeguards Commission – the regulator it says should now be given a dramatically expanded remit to include the entire disability service ecosystem.

“Right now, far too many people with disability, particularly people with an intellectual disability, are hidden away in the suburbs, outside of any protections from violence, abuse, neglect and exploitation,” DANA’s Jeff Smith says.

“We’ve just had a whole royal commission into the faults and problems with the lack of functional safeguards that deliver for people with disability. Disability advocates have continuously blown the whistle on this failure of the regulatory system to oversee quality services that don’t harm, or even cause the deaths of disabled people.

“The current system isn’t fit for purpose and needs change. But it is also vital that people with disability and their families can have control over the services and supports they use. The new system needs to deliver on both.”

One recommendation made by the review is to eliminate the use of unregistered providers altogether. These have been an explicit feature of the NDIS precisely because they offer a way for people with disability to manage their own lives and find support that best works for them without the unnecessary intrusion of the state. It has not worked for all people with disability but this, some say, would present as an overcorrection.

Dr George Taleporos, a leading advocate and person with a severe disability who uses both registered and unregistered supports, tells The Saturday Paper that so-called “self-managing” participants are feeling betrayed by the review.

“We are absolutely devastated by the destruction to self management that this review is proposing,” he says.

“Forcing us to use registered providers takes away our right to decide who comes into our homes and who touches our bodies. This is not what we asked for. It’s what the provider lobby wanted so they can destroy their competition, take over the market and line their own pockets.

“It is crucial now that the Minister [Bill Shorten] understands this and listens to us and holds true to his election promise to put participants at the centre of the NDIS.”

Taleporos says people in the scheme who use unregistered providers must apply to do so and pass a “risk assessment”, and the proposed changes “will destroy self-management and participant choice and control in the NDIS”.

He expects prices for services will increase because of the added burden of forcing providers into universal registration. Others will simply stop working in the sector.

The NDIS Review also appears to spell the end of people with disability being funded to live on their own if they choose.

“Funding for participants requiring 24/7 living supports should typically be on the basis of those supports being shared. In general, reasonable and necessary funding should be based on an average shared support ratio of 1:3, consistent with an assessment of need that determines the maximum support intensity and level of overnight support that a participant is eligible to receive,” the review states.

Taleporos says this is at odds with the disability royal commission final report, in which five commissioners recommended getting rid of so-called “group homes” with an average of four or five long-term residents because of the assault, abuse and violence that can arise.

The NDIS Quality and Safeguards Commission launched an inquiry into this issue, analysing reportable incidents from seven of the largest providers of group homes. It found 1742 incidents of serious injury, 1716 incidents of abuse and 1293 cases of neglect of a person with disability. There were 960 incidents of unlawful physical contact, 112 of unlawful sexual contact, 122 of sexual misconduct and 324 incidents involving the death of a person.

Despite these findings, both here and across the sector, disability advocates have told The Saturday Paper they are concerned the commission – set to take on even more responsibility under these reforms – has not been capable of regulating the registered providers it already has within its jurisdiction.

NDIS Quality and Safeguards Commissioner Tracy Mackey told one advocate during a meeting that the organisation had to manually search through the thousands of complaints made to it and could not easily identify trends or providers that were the subject of multiple complaints, potentially indicating serious issues.

In a statement, the commission says it has “offered roles” to more than 350 people as part of a hiring blitz following a significant budget increase for 850 staff this financial year. The commission says it is seeking to “identify” a replacement complaints platform and in the meantime has established a dedicated “risk and intelligence” team.

How far advanced this really is remains to be seen.

The commission has been shown to promulgate misleading information internally and publicly. Commissioner Mackey told the ABC’s Four Corners in September last year an abusive severe behaviour support program run by Irabina Autism Services had been shut down.

This was not true.

After a year of scandal at the regulator, Community and Public Sector Union deputy secretary Beth Vincent-Pietsch tells The Saturday Paper its members at the NDIS Quality and Safeguards Commission “no longer have confidence in the commissioner”.

“It’s been a really tough year for our members,” she says.

“So many more complaints and reportable incidents are being filed, which is not a bad thing, but the commission’s way of dealing with this is to put incredible pressure on them to close cases perfunctorily and without proper investigation.

“And our delegates have been told, ‘You shouldn’t be in the union. It’s not going to go well for you in terms of your job and your work here’ … and so people understandably feel that they are frightened to speak out.

“But they’ve said in overwhelming numbers that they have lost confidence in the commissioner.”

The work of the NDIS Review, led by the scheme’s minister, Bill Shorten, will extend across multiple portfolios, including those of Social Services Minister Amanda Rishworth and Attorney-General Mark Dreyfus. The federal government is yet to respond to both the review and the recommendations of the Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability. It is expected that the two complementary reports will receive a coordinated response.

This article was first published in the print edition of The Saturday Paper on January 13, 2024 as "The hidden risks in the NDIS restructure".

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