• Most families and individuals cannot adequately prepare for the risk and financial
impact of significant disability. The costs of lifetime care can be so substantial that
the risks and costs need to be pooled.
• The current disability support system is underfunded, unfair, fragmented, and
inefficient, and gives people with a disability little choice and no certainty of access to
appropriate supports. The stresses on the system are growing, with rising costs for
all governments.
• There should be a new national scheme — the National Disability Insurance Scheme
(NDIS) — that provides insurance cover for all Australians in the event of significant
disability. Funding of the scheme should be a core function of government (just like
Medicare).
• The main function (and source of cost) of the NDIS would be to fund long-term high
quality care and support (but not income replacement) for people with significant
disabilities. Everyone would be insured and around 410 000 people would receive
scheme funding support.
• The NDIS would have other roles. It would aim to better link the community and
people with disabilities, including by using not-for-profit organisations. It would also
provide information to people, help break down stereotypes, and ensure quality
assurance and diffusion of best practice among providers.
• The benefits of the scheme would significantly outweigh the costs. People would
know that, if they or a member of their family acquired a significant disability, there
would be a properly financed, comprehensive, cohesive system to support them. The
NDIS would only have to produce an annual gain of $3800 per participant to meet a
cost-benefit test. Given the scope of the benefits, that test would be passed easily.
• The scheme should involve a common set of eligibility criteria, entitlements to
individually tailored supports based on the same assessment process, certainty of
funding based on need, genuine choice over how their needs were met (including
choice of provider) and portability of entitlements across borders. There would be
local area coordinators and disability support organisations to provide grass roots
support. The insurance scheme would take a long-term view and have a strong
incentive to fund cost effective early interventions, and collect data to monitor
outcomes and ensure efficiency.
• The above features would be best met by a having a single agency overseeing the
NDIS — the National Disability Insurance Agency. It would be created by, and report
to, all Australian governments. It would have strong governance arrangements, with
an independent commercial board, an advisory council of key stakeholders, clear
guidelines to ensure a sustainable and efficient scheme, and legislation that
protected the scheme from political influences.
• It would be the assessor and funder, but not the provider of care and support.
Services would be provided by non-government organisations, disability service
organisations, state and territory disability service providers, individuals and
mainstream businesses. Increased funding, choice and certainty are the key features
of the recommended scheme. Advocacy would be funded outside the scheme.
• An alternative but inferior option would be a ‘federated’ NDIS. This would give state
and territory governments control over their own systems, but with some common
core features. Such an arrangement could easily revert to the current flawed and
unfair system, with ‘agreements’ breaking down into disputes about who is to pay,
how much and for what.
• People would have much more choice in the proposed NDIS. Their support
packages would be tailored to their individual needs. People could choose their own
provider(s), ask an intermediary to assemble the best package on their behalf, cash
out their funding allocation and direct the funding to areas of need (with appropriate
probity controls and support), or choose a combination of these options.
• The NDIS would cover the same types of supports currently provided by specialist
providers (but with sufficient funding), give people more opportunity to choose
mainstream services, and encourage innovative approaches to support.
• The Australian Government currently provides funding to the disability sector of
around $2.3 billion, while state and territory governments provide funding of around
$4.7 billion — a total of over $7 billion.
• Current funding for disability is subject to the vagaries of governments’ budget
cycles. People with disabilities have no certainty that they will get reasonable care
and support over the long run. Resourcing might be good one year, but insufficient
the next, with many people missing out. The Commission estimates that the amount
needed to provide people with the necessary supports would be about double
current spending (an additional $6.5 billion per annum).
• The Commission proposes several options for providing certainty of future funding.
Its preferred option is that the Australian Government should finance the entire
costs of the NDIS by directing payments from consolidated revenue into a ‘National
Disability Insurance Premium Fund’, using an agreed formula entrenched in
legislation. The amount needed could be funded through a combination of cuts in
existing lower-priority expenditure, fiscal drag, and if necessary, tax increases.
• A less preferred option is that all governments could pool funding, subject to a longrun
arrangement based on the above formula, and with pre-specified funding
shares. This would need to be closely monitored by transparent accounting and
penalties for failure to meet commitments.
• The scheme would gradually be rolled out from mid-2014. It would start in a few
regions. That would allow fine-tuning of the scheme, while providing high quality
services to many thousands of people. In 2015-16, the scheme should cover all
regions of Australia for the highest priority groups, and should progressively expand
until the scheme covered all people by the end of 2018-19.
• A separate scheme is needed for people requiring lifetime care and support for
catastrophic injuries — such as major brain or spinal cord injuries. Currently, many
Australians get poor care and support when they acquire such injuries because they
cannot find an at-fault party to sue.
• A no-fault National Injury Insurance Scheme, comprising a federation of individual
state and territory schemes, would provide fully-funded care and support for all
cases of catastrophic injury. It would draw on the best schemes currently operating
around Australia. State and territory governments would be the major driver,
developing a comprehensive scheme by 2015.
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