Physical Disability Australia Ltd
PO Box 345 a,
Toowong QLD 4066.
T | 1800 PDA ORG (1800 732 674) physical disability
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| manager@pda.org.au ‘ein Picked. ite
€ | www.pda.org.au
Monday 15 August 2023
Professor Bruce Bonyhady AM and Ms Lisa Paul AO PSM
Co Chairs of the Independent Review of the NDIS
c/o NDIS Review Secretariat
Department of the Prime Minister and Cabinet
PO Box 6500
Canberra ACT 2600
RE: Physical Disability Australia’s submission regarding the NDIS’s
5 Key Challenges
Dear Professor Bonyhady and Ms Paul
Thank you for the opportunity to provide a formal submission on the 5 key challenges facing the National Disability Insurance Scheme (NDIS) that you identified in the NDIS Review’s What we have heard report’. Below you will find Physical Disability Australia’s (PDA’s) thoughts on these challenges and our recommendations on how they can be met and overcome.
Some of our recommendations may be a little contentious and at odds with the recommendations of our partner organisations, but we feel they must be made and we hope they will be seriously considered for inclusion in the review’s report. We are greatly concerned about how the NDIS’s practices change with each new government and how the Scheme has become a political football. PDA contends this must stop and that the NDIS needs to be put on a stable footing with regard to the supports it provides and its capacity to manage its overall cost.
Challenge 1. Why is the NDIS an oasis in a desert?
Answer prompts:
We want your feedback on the best ways to overcome this failing. What supports from governments, business and the community are missing? Does the original vision need to be rethought because people with disability do not neatly fit into silos or ‘tiers’?
The use of the word ‘tiers’ and reference to the ‘original vision’ here is interesting, as PDA believes the ‘oasis in a desert problem’ stems from the lack of investment in delivering benefits to:
e All Australians with disability (including NDIS participants) — Tier 2; and e All Australians (including all those with disability) — Tier 1,
1 httos:/Awww.ndisreview.gov.au/sites/default/files/resource/download/what-we-have-heard report.pdf
Physical Disability Australia is a member of the Disability Australia National Peaks Consortium
… as described in the Productivity Commission’s report on its Inquiry into Disability Care and Support2 – the document that led to the then government’s decision to create the NDIS. So the obvious solution to the problem of the NDIS being ‘an oasis in a desert’, is more intellectual, social and economic investment in Tiers 1 and 2 so that all Australians have ownership and can have pride in the NDIS, and all Australians with disability have access to supports outside the particular supports provided by the NDIS to its participants. Tier 1 In the section of the Productivity Commission report’s Overview Booklet that describes the benefits to all Australians of establishing the NDIS it is noted: the Commission’s use of the word [insurance] simply reflects the need to ensure that the community pools resources to provide reasonable long-term supports for people acquiring a significant disability.3 PDA has long argued that the best way to pool the community’s resources and give all Australians ownership of and pride in the NDIS is to make them pay for it personally. A lot of noise is made about how the NDIS operates on ‘insurance principles’ but insurance, as everyone understands it, involves premiums. Just as all Australians are proud owners of Medicare because they pay a percentage of their income to realise universal health care, they should also pay a percentage of their income to realise adequate support to those Australians with disability who really need it to live an ordinary life. More will be said about the benefits of funding the NDIS at least partially in this way in our answer to Challenge 5 below. Tier 2 The Overview Booklet also describes how responsibility for non-NDIS disability supports should be divided between the NDIS and the rest of Australia’s support funders: …all governments would continue to support a range of community and carer support services, including some existing or modified Home and Community Care services, for people with lower level or shorter-term disabilities. These would be similar to those proposed within a reformed aged care system, and would be directly accessible by people with disabilities and their carers. They would be largely block-funded, with some limited user charges. (emphasis added). From PDA’s perspective, all governments outside the NDIS have decided they might not continue to support these services because there is no explicit and enforceable requirement for them to do so in the NDIS Act 20134, the Disability Services Act 19865, nor its draft replacement6).
2 https://www.pc.gov.au/inquiries/completed/disability-support/report 3 https://www.pc.gov.au/inquiries/completed/disability-support/report/disability-support-overview-booklet.pdf p. 10 4 https://www.legislation.gov.au/Details/C2022C00206 5 https://www.legislation.gov.au/Details/C2020C00387
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We also believe this problem is exacerbated by a lack of understanding of, and strict adherence to, the Applied Principles and Tables of Support (ATPOS) to Determine Responsibilities of the NDIS and Other Services7. So part of moving away from the ‘oasis in a desert’ paradigm would necessarily involve the Federal Government taking a firm approach with those responsible for non NDIS services to all Australians with disabilities, regardless of their participant status. The other part of moving away from the ’oasis in a desert’ paradigm involves a revamp of the largely abandoned Information Linkages and Capacity-building (ILC) program so that it better reflects the description of these freely-available supports in the Productivity Commission’s report: An important role for the NDIS in both tiers 1 and 2 would be to strengthen voluntary links between the community and people with disabilities — to stimulate ‘social capital’. The goal would be to increase, rather than crowd out existing formal and informal arrangements. For example, local area coordinators (the scheme’s case managers) could help link people with disabilities to local community groups (for example, a sailing club) and the NDIS would sometimes provide small grants to help such groups involve people with disabilities.8 The absolute capacity for the NDIS to fund implement these Tier 2 supports was removed by the former government when the decision was made to transfer responsibility for commissioning and funding ILC activities from the NDIS to the Department of Social Services (DSS). Here, the ILC program has languished: its scope has been narrowed; its grant application requirements have become more onerous; and its overall budget has been reduced to point where it now only provides for the elongation of a small number of previously funded ILC activities9 while a (yet-to-be-completed) review is carried out. Since 2021, DSS has not provided any grant assistance for businesses and community organisations to invest in freely-available disability supports. To solve the problems associated with the NDIS being ‘an oasis in a desert’, PDA recommends the government:
- Give all Australians ownership of and pride in the NDIS by introducing an NDIS levy payable by all Australians as a percentage of their income in a way analogous to the Medicare levy10;
6 https://engage.dss.gov.au/wp-content/uploads/2023/06/exposure-draft-bill.pdf 7 https://www.dss.gov.au/disability-and-carers-programs-services-government-international disability-reform-ministerial-council-reports-and-publications/the-applied-principles-and tables-of-support-to-determine-responsibilities-ndis-and-other-service 8 p.23 https://www.pc.gov.au/inquiries/completed/disability-support/report/disability-support-overview-booklet.pdf 9 https://www.dss.gov.au/disability-and-carers-programs-services-for-people-with-disability/information-linkages-and-capacity-building-ilc-program 10 PDA understands that this is politically unappealing but believe strongly it is a bullet that needs to be bitten.
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Take a firm approach to ensure all jurisdictional and local government authorities meet the requirements for providing non-NDIS supports as defined in the ATPOS; and
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Transfer the ILC program back to the NDIS where it can be delivered in a way that articulates the Productivity Commission’s vision for Tier 2 – supports for all Australians with disability.
Challenge 2. What does ‘reasonable and necessary’ mean?
Answer prompts We want your feedback on how to best clarify and put into practice reasonable and necessary so that outcomes are clear for participants and everyone knows what to expect from the scheme. What frameworks or processes could help make this fundamental change? The preamble to this challenge question in the What have have heard report notes “reasonable and necessary is poorly defined…” This is an understatement. Section 34 of the NDIS Act 2013 says that the CEO will know a ‘reasonable and necessary’ support when they see it because they are satisfied it will: ✓ Assist the participant to pursue their goals, objectives and aspirations; ✓ Assist the participant to undertake activities that facilitate their social and economic participation; ✓ Represent value for money by being the cheapest available alternative that achieves the requested support’s facility; ✓ Be beneficial and effective to the participant as measured against current ‘good practice’; ✓ Takes account of what it is reasonably expected of participants’ families, carers, informal networks and community to provide; and ✓ Not be more appropriately provided by non-NDIS programs and providers that have universal service obligations and ‘reasonable adjustment’ obligations. A plain reading of the above paraphrased section of the Act indicates the only boundaries legislation places on the NDIS with regard to determining whether any support that a participant may request with regards to its reasonableness and necessity are that it won’t be: An expensive option; Lacking endorsement with regard to current ‘good practice; Something that families, carers, informal networks and the community might provide to a non-participant / person without a disability; nor Something that a non-participant with disability would have a right to if the NDIS didn’t exist. The broadness of these boundary conditions leave it open for participants, advocates and providers to claim ‘reasonable and necessary’ status for supports that PDA is sure the framers of the NDIS never envisioned. As a consequence, the Administrative Appeals Tribunal (AAT) has concluded that, for example:
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Participation fees and airplane tickets for a carer to attend interstate sports events with a participant twice a year11;
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Treatment by a specialised sexual therapist to the value of $10,800 per annum12; and
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A new Volkswagen Caravelle13 … are all ‘reasonable and necessary’ supports that must be provided by the NDIS to particular participants (based on their evidence with regard to their impairments, support needs, and personal circumstances). Without changes to the definition of ‘reasonable and necessary’, decisions such as these, whether or not the can technically be regarded as precedents, incentivise participants, their advocates, and unscrupulous businesses to test the boundaries of the NDIS might be compelled to provide. PDA argues that overcoming this challenge hinges on having a common understanding of ‘reasonable and necessary’ and that that this requires that the government to include a more robust definition of this term in the NDIS Act 2013, and that the NDIS itself make its planning and review practices more transparent.
Legislation
The first issue with regard to arriving at a common understanding of ‘reasonable and necessary’ involves the government, people with disability (not just NDIS participants), their representative organisations, and their informal supporters co-drafting amendments to those sections of the NDIS Act 2013 that define and make use of the term so that they encompass participants’ genuine support needs and fit within generous community conceptions of reasonableness and necessity. PDA also argues that the definition of ‘reasonable and necessary’ in legislation must incorporate a ‘comparator’ against which any given participant’s support claims can be measured in a similar fashion to how this concept is applied in section 5(1) of the Disability Discrimination Act 199214. In this Act, claimed instances of direct discrimination are assessed against whether those instances would negatively affect in a similar way a hypothetical person in similar circumstances without disability. In NDIS terms, the comparator test with regard to any participant’s ‘reasonable and necessary’ support claims could be compared with the capacity of a person without the participant’s impairments who lives in similar circumstances. This would create a level playing field for NDIS participants without giving them what the community might regard as ‘unreasonable and unnecessary’. In this paradigm, for example, transport to and from a gym could be funded for a participant and support worker (because appropriate mainstream transport options are not available), but gym memberships might not be (because the
11 https://austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/AATA/2018/2709.html 12 https://austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/AATA/2019/1771.html 13 https://austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/AATA/2021/4358.html 14 https://www.legislation.gov.au/Details/C2022C00367
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comparator is expected to pay for gym membership out of their own financial resources15).
Transparency
The second issue with addressing a lack of common understanding of ‘reasonable and necessary’ involves disclosure of the NDIS’ understanding of the term to participants before NDIS planning and internal review delegates assess whether or not claimed supports are approved for funding. PDA believes thorough transparency with regard to how overall support plan budgets are determined would allow the NDIS to manage participant expectations so they are more inline with government and community expectations. As it stands, very few participants are aware of how the NDIS comes up with budgets they expect will meet their particular support needs16. They do not know that NDIS planning and internal review delegates use template budgets (called Typical Support Packages or TSPs) to initially estimate what quantity of supports would be considered ‘reasonable and necessary’ given their impairments and circumstances. This is not mentioned in any of the resources given to participants before they attend planning or internal review conversations. Nor do they know what TSP(s) is likely to be used in the development of their personal support plans. To be clear, PDA understands the importance of having a range of benchmarks to assist planning and internal review delegates in establishing jumping-off points for what supports are likely to be ‘reasonable and necessary’ for participants with very different impairments and support needs. From our plain reading of the references to TSPs across the NDIS website17 it is clear that the a great deal of importance is placed on them and that it is expected they will be well-used and referred to frequently. What PDA argues is that the use of TSPs, their details, and any other relevant decision making tools, needs to be explicitly and clearly explained to participants ahead of meetings with Local Area Coordinators (LACs) and NDIS planning and internal review delegates. We also think it’s important that the full details of TSPs be made publicly available so that participants, would-be participants, and all Australians can have a deeper understanding of what any given participant might reasonably be provided with, at least with regard to Core and Capacity-Building supports, and their associated budget allocations. To solve the problems associated with the lack of having a clear and agreed upon definition of ‘reasonable and necessary PDA recommends the government:
- Work as equals with people with disability (not just NDIS participants), their representative organisations, and their informal supporters to co draft amendments to those sections of the NDIS Act 2013 defining and
15 In this example PDA assumes physical activity at a particular gym is not essential for participant wellbeing, but discretionary. 16 Information about how TSPs are used is available on the NDIS website however it is mostly located in the ‘operational guidelines’ section that is not clearly linked to the main participant information pages (https://www.ndis.gov.au/participants). 17 List of sites were identified using a search engine to scour the NDIS website for instances of the term: https://www.google.com/search?q=site%3Andis.gov.au+%22typical+support+package%22
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making use of the term ‘reasonable and necessary to include a comparator test; and
- Commit to complete transparency with regard to the processes that the NDIS uses to determine what might be ‘reasonable and necessary’ supports appropriate for NDIS funding.
Challenge 3: Why are there many more children in the NDIS than expected?
Answer prompts We want your feedback on how support for all children with disability should be structured, not just those in the NDIS. What is the best way to support children with disability and families? PDA does not have members under the age of 18, nor have we had much involvement in discussions around the unexpected numbers of young children becoming and remaining participants18. We also do not want what follows to be acceded to if our recommendations differ from those more knowledgeable about the support needs of children with disability. That being said, PDA feels the supposed problem of there being too many participants under the age of 9, and of their remaining in the NDIS after receiving early intervention supports stems from legislative ambiguity around the NDIS’ access requirements and governments’ misunderstanding of the nature of children with disability’s impairments. Legislative ambiguity Section 21 of the NDIS Act 2013 sets out the criteria by which a person with disability may gain access to the NDIS. To get access, applicants must, in addition to meeting age19 and residence requirements20, meet the disability requirements including that its related impairments “are, or are likely to be, permanent” (emphasis added)21. But then, section 35 of the Act extends access to children who have developmental delay (which implies this disability’s related impairments are not, nor are likely to be permanent), and that such children (and possibly others with different diagnoses) though the provision of early intervention supports, will have their functional capacity improved to the point that they no longer require NDIS funded supports. That is, the government granted otherwise ineligible children with disability access to the NDIS on the un-tested expectation that they would leave voluntarily (in accordance with section 29) or more harshly by having access revoked by the CEO (in accordance with section 30). Given the ‘oasis in a desert’ situation discussed above, PDA feels it is exceedingly unlikely that any parents of children with developmental delay (or any other disability that meets the early intervention requirements) will notify the CEO in writing that they no longer wish their children to receive cost-free
18 In line with NDIS policy, we define young children as being under the age of 9 (https://www.ndis.gov.au/understanding/families-and-carers/early-childhood-approach-children-younger-9) 19 As defined in section 22. 20 As defined in section 23. 21 And as otherwise defined further in section 24
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disability supports. We also feel it is similarly unlikely that the CEO will risk reputational and political harm to the NDIS and the government respectively by determining young participants no longer meet the access requirements. The nature of children with disability’s impairments Not withstanding the confusing and semi-self-contradictory sections of the NDIS Act 2013 relating to access through meeting the disability requirements and/or the early intervention requirements, PDA feels the expectation that young participants will voluntarily leave the NDIS belies a fundamental misunderstanding by government of the nature of many impairments and the effects of early intervention therapy on children who have them. Firstly, the impairments of children with disability are often not curable. Specialist allied health therapy for children with cerebral palsy, for example, can have great benefits in terms of giving these children a great deal of functional capacity. In many cases, this includes: being able to sit without a lot of support; being able to speak clearly; being able to eat solid food safely; and being able to walk un-assisted or with an appropriate mobility aid. But however impressive these improvements to functional capacity may be, it should never be assumed that children with cerebral palsy (or many other impairments) will come to the point that they will no longer meet the disability requirements listed in section 21 of the Act. This is because, the effects specialist allied health therapy are not always permanent. If they are ceased, some (perhaps many) children are likely to lose the functional capacity they recently developed. On top of that, the effects of some impairments become more severe as children with disability grow and mature. Many adults with cerebral palsy who require power wheelchairs for mobility were able to walk to some extent when they were children but lost this functional capacity as they naturally became larger and heavier. They may still be able to sit unsupported, talk clearly, and eat safely but this does not mean they no-longer meet the NDIS disability requirements and it should never be expected that they will voluntarily leave. To overcome (or just accept) the challenge of having more NDIS participants under 9 years old than expected places the government in an uncomfortable dilemma. It must either: ? Make legislative changes to deny access to children with impairments that are not nor are likely to be permanent and leave them out in the proverbial desert; or ? Accept the situation for what it is, understanding that most young children’s impairments are, or are likely to be permanent, and that these children are likely to require support under the NDIS for their lifetimes PDA notes that the first option may well lower the projected costs of the NDIS but at the cost of incurring the sustained ire of the disability sector.
Challenge 4. Why aren’t NDIS markets working? Answer prompts We want your feedback on how, when and where NDIS markets could be better designed, structured and supported. What needs to be done to ensure NDIS markets serve the interests of
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people with disability, rather than the other way round? Where will markets not work? How can scheme help participants become more independent; not more dependent? PDA believes the problems associated with this challenge result from the early decision to publish annual NDIS Pricing Arrangements and Price Limits documents that set maximum prices for many support items, and a lack of market levers to stimulate competition amongst support providers so that they need to offer participants outcome-delivering products at a competitive price.
NDIS Pricing Arrangements and Price Limits documents
In our submission22 to the NDIS’ 2022-23 Annual Price Review (APR)23, we argued that that having NDIS Pricing Arrangements and Price Limits documents that specify maximum amounts for a lot of the supports participants need only invites all providers of these to charge these maximum amounts. This resultant charging by many providers of the perceived ‘NDIS levy’ excuse will only be revoked by forcing them to charge no more than reasonable market defined prices. PDA sees two ways to achieve this:
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Set the maximum chargeable amounts for providers who also work for non-NDIS participants at the median fees charged to non-NDIS Participants; and/or
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Doing away with these (if not all) NDIS Pricing Arrangements and Price Limits figures and making participants (and their Plan Managers/Support Coordinators) responsible for identifying value for money supports that fit within a set budget. PDA also noted in its submission that the APR Consultation Paper’s questions were predominantly support provider focused and phrased in a way that begged the question as to whether price limits needed to be increased. As a disability representative organisation, we expected all support providers to claim that the maximum chargeable amounts listed in the NDIS Pricing Arrangements and Price Limits document needed to be raised to enable them to stay ahead of all plausible cost drivers and also remain sustainable (for non-profits) and/or profitable (for those with shareholders). This is not how other personal service and technology markets operate.
Market Leverage
Customers not in the market for NDIS funded supports have access to many independent sources of information about the services and products they are looking to purchase so they can compare features, prices and other consumers’ reviews. As a result, businesses servicing mainstream markets know they must match if not exceed their competitors’ best offer with regard to quality and price if they are to become market leaders. PDA argues that NDIS participants (and their support coordinators / plan managers) deserve access to similar high-quality sources of information so that they too can exercise power in the disability supports market and select those that give them value for money.
22 Not yet mentioned or referred to in NDIS submission lists 23 https://www.ndis.gov.au/media/5810/
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To solve the problems associated with challenge 4, PDA recommends:
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The NDIS reconsider the utility of the NDIS Pricing Arrangements and Price Limits documents and if it is considered they are still needed, look into setting price limits in a more objective, value oriented fashion; and
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Fund a range of independent (of service providers, their representative bodies, and the NDIS), well-organised, easy to navigate sources of information giving details of what each provider of NDIS supports (who cares to submit information) is offering and the prices it charges for these.
Challenge 5. How do we ensure that the NDIS is sustainable?
Question prompts We want your feedback on how to best to measure both the benefits as well as the costs of the scheme and how to ensure the scheme is sustainable. How can the Review better balance the goals of choice and control and sustainability and contribute to the new sustainability framework24 foreshadowed by National Cabinet? The answer prompts provided above suggest that sustainability is mostly contingent on limiting how much money is invested in the NDIS regardless of the cost-benefit it provides to the Australian economy25 and the means by which it is funded. The emphasis of NDIS critics is always that costs must be reduced with no acknowledgement of the impact that will have on what adds to the Australian economy nor the overall quantity of support that can be provided to participants. PDA regrets to see the current government legitimising some of these critics’ concerns with its ‘foreshadowed sustainability framework’ goal of reducing NDIS cost growth to 8% per annum. As noted in our answer to Challenge 1 above, PDA has long advocated the introduction of a NDIS levy as a means to genuinely give all Australians ownership of and pride in the NDIS. Given that having the NDIS totally funded through a levy on individual taxpayers is unrealistic (it would amount to 6% of their taxable income26), if it were also levied on corporate taxpayers and, like Medicare, partially funded from general revenue as well, would be a lot less and a lot more politically palatable.
24 A system of measures to effectively cap NDIS cost increases to 8% per annum (https://ministers.dss.gov.au/media-releases/11011) 25 Economic think-tank, Per Capita estimates the NDIS returns $2.25 to the Australian economy for every $1 invested in it (https://percapita.org.au/blog/our_work/false-economy-the-economic-benefits-of-the-ndis-and-the-consequences-of-government-cost-cutting/) 26 Calculated on the following assumptions: A full and part-time working population of 12,057,653 (https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/income-and-work-census/latest-release), an average weekly income of $1,376.60 (https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/average-weekly-earnings-australia/latest-release) and a NDIS cost of $36.7Billion (https://www.aph.gov.au/About_Parliament/Parliamentary_departments/Parliamentary_Library/Budget/reviews), this would equal $3,113.85 per working Australian per annum or 6% of taxable income (taking into account tax-free threshold and average pre-tax deduction of $3,000)
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PDA contends that such a change to how the NDIS is funded would change Australians’ perception of the NDIS from a very expensive (and growing) tax burden, to something good that they personally contribute to. We also argue that levying of NDIS premiums will largely remove the NDIS from political squabbles around how much it costs and how rising costs are managed. Evidence for this conclusion can be seen in the lack of any real political debate regarding the cost of the Medicare scheme that provides free or subsidised medical care to all Australians at public health facilities. At a projected cost of $104.1 Billion for the 2023-24 financial year27, Medicare costs almost 3 times what the NDIS does and one might reasonably expect fiscally conservative politicians and their constituents to be very vocal about the tax burden of the Medicare scheme and its expected 5.7% per annum growth rate. But they are largely silent on this. They know cutting expenditure on Medicare will be very unpopular with Australians who value it and are happy to pay a levy of 2.5% of their taxable income for what it provides to everyone. To meet the challenge of ensuring the NDIS is sustainable, PDA recommends:
- The government introduce a NDIS levy in the next Federal Budget to give all Australians a stake in it and allow the pride taxpayers have in their disability support scheme to quash political debate over it’s growing costs.
Conclusion
Physical Disability Australia (PDA) sincerely hopes the compilers of NDIS Review’s report and recommendations are open to serious consideration of suggestions that might be quite tangential from those they receive from our partner organisations, providers, political lobbyists and the general community. The NDIS is at a critical point in its life and we truly appreciate the government’s decision to establish an independently conducted review to provide advice on changes that can fix the problems many participants, support providers, disability advocates and pundits in general have with the way the NDIS operates. Bold action is needed to overcome the 5 challenges detailed in the What we have heard report and we feel it is your obligation to put similarly bold recommendations on the table alongside those that reflect any consensus among other stakeholder submissions. This one comes from the organisation representing a significant cohort of NDIS participants and our recommendations are presented with the aim of ensuring they continue to receive the supports they genuinely require for many years to come. Yours sincerely
Andrew Fairbairn Simon Burchill
President and Director (WA) General Manager
Physical Disability Australia Physical Disability Australia
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About Us: Physical Disability Australia (PDA) is a national peak membership-based representative organisation run by people with physical disability for people with physical disability. PDA was founded in 1995 and have over 1,200 members from all Australian States and Territories. Our purpose is to:
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Remove barriers through systematic advocacy to all levels of government to enable every Australian living with a physical disability opportunities to realise their full potential;
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Proactively embrace and promote difference and diversity for an inclusive society; and
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Actively promote of the rights, responsibilities, issues and participation of Australians with physical disability.
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