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NDIS funding a start but limited trial means a long wait for most

Last night’s budget contained an important step towards realising a National Disability Insurance Scheme (NDIS), with $1bn allocated over the next four years. Of these funds, $342.5 million will pay for…

At the end of the four years, only 5% of Australians with a disability will be covered. Flickr/afri

Last night’s budget contained an important step towards realising a National Disability Insurance Scheme (NDIS), with $1bn allocated over the next four years. Of these funds, $342.5 million will pay for individualised care and support for 10,000 people in four yet-to-be-announced “launch sites” in 2013-14. The trial will grow to include 20,000 people by 2014-15.

The remainder of the funding will go towards the set-up costs of the NDIS over four years, including systems for data collection and analysis, local area coordinators, a new agency to oversee implementation and manage delivery, assessment of need and monitoring of outcomes and the effectiveness of the scheme.

The government’s announcement will see people assisted by the scheme a year earlier than the timeline the Productivity Commission suggested in its 2011 report into disability care and support.

But there are some major shortfalls in last night’s announcement. At the end of the four years, only 5% of the estimated 411,000 Australians living with a significant disability will be receiving individualised support under the scheme.

The NDIS is a large and complex reform that must be managed carefully. A graduated roll out is inevitable – and could strengthen the scheme over time as lessons are learned from each stage and then applied. But people living with a disability have already waited too long for improved services. The Productivity Commission recommended a rapid increase in the number of people included until the scheme is fully rolled out in 2018-19 and warned “the scheme must not be open-ended”.

The budgeted amount is also considerably less than the Productivity Commission’s estimate of the start-up costs – $893 million for support and care for the first 20,000 people, along with additional funds for administration. The budget has only allowed $345.4 million for these costs in that year, or 39% of the Commission’s estimate. The four-year allocation is just 26% of the Commission’s recommended amount for the same period.

The Productivity Commission has labelled the current disability system as “inequitable, underfunded, fragmented, and inefficient and give people with a disability little choice”. Resources are often only allocated after a family crisis. This is damaging for the people involved, and costly and inefficient for the system.

Inevitably, crises have to receive priority, but redirecting resources away from more timely assistance creates a cycle of crisis. If the funding allowed for the trial is inadequate, it will be harder to break this cycle, skewing outcomes and making evaluation of a properly functioning scheme difficult.

Another concern is the government hasn’t detailed plans beyond the next four years, including when full roll-out will be achieved. This is a missed opportunity to articulate plans for legislation of the scheme and dates for full implementation. The slow pace and uncertainty around future expansion will exacerbate the unfairness of the current system in the short run.

If informal care collapsed in this country, or even followed a natural decline as carers age while their disabled children live longer, the government would face a huge surge of liabilities. The NDIS is a major reform that must be undertaken to address this problem, and to improve what Bill Shorten once described as systemic second class treatment of people with disabilities.

Budgets are about fiscal management and responsibility, and they are also about social choices. The allocation for the NDIS in this budget is welcome, but much more needs to be done.