Submission 25 Head Office

Orange (08) 8373 8388 ABN 16 464 890 778 778 24 April 2026 Libby Coker MP

Chair of the Joint Standing Committee on the National Disability Insurance Scheme PO Box 6100 Parliament House Canberra ACT 2600 Email: ndis.joint@aph.gov.au

deeply concerned about this Inquiry.

Dear Chair, Re: Inquiry into the Integrity of the National Disability Insurance Scheme (NDIS)

We write to you regarding the Joint Standing Committee on the National Disability Insurance Scheme’s (NDIS) Inquiry into the Integrity of the NDIS. We acknowledge the tone of this letter may be somewhat blunt, but this reflects the level of despair among many in the disability community who are undeservedly bearing the brunt of a highly politicised attack on the NDIS. The NDIS was and remains a fundamentally sound policy initiative and a very good Scheme for all Australians — mistakes of successive ministers, governments, and parliaments regarding its implementation do not change this.

The focus of this Inquiry overlaps with the current Joint Committee of Public Accounts and Audit’s Inquiry into the Administration of the NDIS. These inquiries are in addition to the annual inquiry of the NDIS Committee, which is also ongoing and covers the same topics, among others. Given the significant focus on the effective use of public resources within the NDIS that is implicit in all of these, we note that holding multiple simultaneous inquiries covering similar matters, rather than a single streamlined and comprehensive process, seems wasteful. Broadly, the demands placed on the disability sector and community to repeatedly respond to poorly framed, overlapping, and duplicated consultation processes are unreasonable, and will not result in the provision of the highest quality evidence due to overstretched capacity. Indeed, the current disjointed approach of the government and parliament to dealing with NDIS matters is unsustainable for the disability sector and community, and not a purposeful way to undertake reform processes or to use public resources.

purpleorange.org.au Inform. Connect. Influence.

Additionally, we continue to be deeply concerned about the politicisation of the NDIS and,

especially, of the lives of Australians with disability. This is extremely harmful. We emphasise,

again, that successive ministers, governments, and parliaments are responsible for failings in the

Scheme – not NDIS participants who have no control over policymaking but endure the greatest

consequences. Recent political and media commentary that the NDIS is losing its ‘social license’

is cited as a justification for cutting the Scheme, yet it is politicians and the media who are largely

responsible for creating this negative public sentiment. The NDIS has now been under reform for

more than half of the time it has existed with little improvement to show for it. As Minister for the

NDIS Mark Butler acknowledged at the National Press Club on 22 April 2026, the recent ad hoc

changes to the Scheme have not contributed in any substantive way to improving its quality,

safety, or sustainability. This should ring alarm bells about continuing to approach the process of

reform in this way.

Instead, we strongly believe the best path forward is for the Federal Government to adopt a

genuine comprehensive co-design process that includes lived experience and subject matter

expertise in decision making, implementation, and evaluation to ensure the NDIS is fit-for-

purpose now and into the future. So far, what has been called co-design has, in fact, been

piecemeal consultations with ineffective outcomes resulting in a drawn-out period of upheaval in

the Scheme and in the lives of participants. Anecdotal evidence suggests individual NDIS plans

have recently been cut in random and inconsistent ways to meet an arbitrary cost saving

percentage without any coherent or transparent framework for decision making or the delivery of

high-quality disability supports. Now, Minister Butler has announced cuts to budgets in individual

plans, effective this year, and to how many people with disability will be able to access the NDIS

from 2028, seemingly as a substitute to doing the hard work of genuine policy evaluation and

reform in partnership with Australians with disability. To be clear, the disability sector and

community has sought to partner with governments and to work together on sensible reforms for

many years but these calls for a genuine comprehensive co-design process have been rebuffed.

This is despite the fact that creating a high-quality NDIS that delivers high-quality disability

supports will result in a cheaper, more sustainable Scheme. In his Press Club address, Minister

Butler repeatedly named poor quality support and safety issues as problems but offered no

solutions to specifically address these; only cuts.

Ideally, JFA Purple Orange would like to provide a new submission to this Inquiry, however,

considering our resource constraints, we simply cannot do so at the current time. Therefore, we

provide your Inquiry with our submission to the concurrent Inquiry into the Administration of the

NDIS, which covers very similar and relevant topics. We have lodged 10 NDIS-related

submissions to various committees and government agencies in just the past six months. On the

purpleorange.org.au Inform. Connect. Influence.

specific question of provider registration, which this Inquiry includes, this is the eighth time our

input has been sought, by seven different entities, over three years. It is not clear to us that this

work was even considered before Minister Butler’s announcement of large cuts. Again, we

reiterate that a genuine comprehensive co-design process would be a more effective

allocation of resources than the previously disjointed, now unilateral, approach to reforms, and

will have a much higher chance of achieving successful outcomes.

It would also assist in halting the significant decline in trust and confidence in government,

parliament, and politicians that has been occurring across the Australian community due to poor

policymaking, implementation, and oversight over many years, followed now by Minister Butler’s

announcement of cuts with very little detail to justify or explain them. Giving lip service to positive

sentiments about the origins of the NDIS while making decisions that undermine the Scheme’s

original promise, including that it would respond to need and not be subject to arbitrary caps, only

adds to this concern. The result is that trust and confidence have been decimated while

uncertainty, anxiety, and fear in the disability community have surged. This, too, is extremely

harmful.

Please find attached a copy of our submission to the Joint Committee of Public Accounts and

Audit regarding its Inquiry into the Administration of the NDIS, which will be useful to inform this

Inquiry. Notwithstanding our limited resources to provide a bespoke submission, **we request the

opportunity to appear at a hearing to expand on the content of this submission and to

address Minister Butler’s just announced future agenda.** To arrange this, could Committee

staff please contact redacted, Manager – Policy and Projects, JFA Purple Orange, on

redacted or redacted.

Yours sincerely

redacted

Belle Owen

Interim Strategy Lead

JFA Purple Orange

purpleorange.org.au Inform. Connect. Influence.

Submission to the Joint Committee of

Public Accounts and Audit regarding

the Inquiry into the administration of

the National Disability Insurance

Scheme (NDIS)

February 2026

About the Submitter

JFA Purple Orange is an independent, social-profit organisation that undertakes systemic policy

analysis and advocacy across a range of issues affecting people with disability and their

families.

Our work is characterised by co-design and co-production, and includes hosting a number of

user-led initiatives.

Much of our work involves connecting people with disability to good information and to each

other. We also work extensively in multi-stakeholder consultation and collaboration, especially

around policy and practice that helps ensure people with disability are welcomed as valued

members of the mainstream community.

Our work is informed by a model called Citizenhood.

JFA Purple Orange

104 Greenhill Road

Unley SA 5061 AUSTRALIA

Telephone: +61 (8) 8373 8388

Email: admin@purpleorange.org.au

Website: www.purpleorange.org.au

Facebook: www.facebook.com/jfapurpleorange

Contributors

Cathy Cochrane, Senior Policy Leader

James Murphy, Policy and Research Leader

Selena Maddeford, Manager – Policy and Projects

Tracey Wallace, Interim CEO

Acknowledgment of Country

JFA Purple Orange acknowledges the Traditional Owners of Country throughout Australia. We

work on many Aboriginal lands, including Kaurna Country, where our head office is located. We

extend our respect to all Aboriginal peoples on the lands where we work, live, and learn. We are

committed to walking together and building relationships grounded in the self-determination of

First Nations peoples.

Recognition of disability community

We recognise that JFA Purple Orange exists to advance the rights of people with disability. All

our work aims to create a more inclusive world where people with disability have access to the

same opportunities as everyone else.

Summary and recommendations ……………………………………………………………….. 5
Introduction …………………………………………………………………………………………… 10

2.1. Problematic scope of this Inquiry ……………………………………………………….. 12

Foundations of NDIS critical to inform its future …………………………………………. 13

3.1. Original promise still holds true ………………………………………………………….. 13

3.2. The Social Model of Disability ……………………………………………………………. 14

3.3. Inclusion is not segregation ………………………………………………………………. 15

Missteps in NDIS implementation …………………………………………………………….. 18

5.1. Scheme forecasts overlooked significant unmet need ………………………….. 18

5.2. Poor performance of NDIA Board ………………………………………………………. 19

5.2.1. Insufficient Board oversight of quality outcomes ................................... 20

5.2.2. Insufficient Board oversight of Scheme sustainability ........................... 22

5.2.3. Insufficient Board oversight of systems and processes ........................ 24

5.2.4. Balancing multiple Board roles .............................................................. 27

5.2.5. Increase Board transparency ................................................................ 27

5.3. Missing Tier 2 ………………………………………………………………………………….. 28

5.4. Issues that hamper ILC success ………………………………………………………… 30

A new way forward for the NDIS………………………………………………………………. 32

6.1. Genuine co-design is critical ……………………………………………………….. 32

6.2. Place accountability at the core …………………………………………………………. 33

6.3. Establish clear roles without conflicts …………………………………………. 34

6.4. Let participants author their own plans …………………………………………. 36

6.5. Apply clear principles on what supports can be purchased …………….. 37

6.6. Balance natural and formal safeguards …………………………………………. 39

Conclusion ……………………………………………………………………………………………. 41

1. Summary and recommendations

This submission acknowledges that there have been a range of mistakes and problems created

in the way successive governments have rolled out and managed the National Disability

Insurance Scheme (NDIS) and these have unnecessarily increased the cost of the Scheme. But

we cannot emphasise strongly enough that poor implementation does not turn a good idea into

a bad one. The NDIS was, and remains, a fundamentally good idea that should be defended

and strengthened to ensure it delivers its original promise. Our collective focus should be on

fixing the problems and building a stronger Scheme that delivers higher quality supports and

better outcomes for participants while being cost-effective and sustainable for taxpayers and

society.

Our submission is presented in three parts. First, we urge the Committee to reflect on the

origins of the NDIS and its core tenets of dignity and inclusion for Australians with disability.

Understanding the origins and the path the NDIS has taken to date is crucial to charting a better

course forward that holds true to the fundamental essence of the Scheme while protecting it for

future generations. The Social Model of Disability should underpin this with the recent

regression to the outdated tropes of the Medical and Charity models firmly rejected. The NDIS

is an insurance scheme for the benefit of all Australians and not a ‘welfare’ measure or a ‘care’

system. Importantly, inclusion does not mean segregation or ‘special’ provisions, which are

inevitably more expensive because they fail to leverage existing resources in our communities.

Second, we highlight some of the missteps in the implementation that have negatively impacted

the Scheme’s roll out and increased costs. We note that the initial modelling for the NDIS was

problematic due to underestimating the level of unmet need at the time and a reliance on known

costs that were largely associated with outdated models. This has resulted in an unrealistic

benchmark and misconceptions about the reasonable costs of the Scheme. The NDIA Board

has also fallen short of its responsibilities in ensuring the Scheme fulfils its legislated functions

and in not providing sufficient oversight. The Committee should examine how the Board failed to

ensure the NDIA had fit-for-purpose processes and systems that identified, prevented, and

remedied issues of waste, misuse, and fraud over many years. Further, all levels of government

have failed to deliver what the Productivity Commission envisaged as Tier 2 supports. While this

is now broadly acknowledged, it has until now had a significant impact on driving demand for

individual NDIS plans and thereby increasing costs. Well-designed and comprehensive

Foundational Supports should help overcome this in the future.

The final section focuses on the future of the NDIS. We strongly believe the Federal

Government should establish an overarching genuine co-design process that involves people

with disability and subject matter experts in decision making about sensible reforms.

Additionally, we offer a few ideas that we believe should be considered in this co-design

process, including the need for increased focus on accountability, establishing clear roles in the

Scheme and eliminating conflicts of interest, letting participants ‘author’ their own plans

according to their assessed budget as part of a simplified participant pathway that eliminates

line-by-line adversarial negotiations, applying clear principles to determine the supports that can

be purchased, and investing in creating cost-effective natural informal safeguards for

participants alongside stronger formal oversight mechanisms.

We recommend:

Recommendation 1: The Joint Committee of Public Accounts and Audit should expand

its Terms of Reference to include the impact of political actors, especially ministers, on

the administration of the National Disability Insurance Scheme (NDIS) and its

performance regarding the quality of supports provided to participants, outcomes

achieved, mitigation of Scheme risks, and management of financial sustainability.

Recommendation 2: The Joint Committee of Public Accounts and Audit should reflect on

the content of the landmark ‘Shut Out’ report and its core tenants of dignity and

inclusion in considering how the National Disability Insurance Scheme (NDIS) has been

rolled out and managed, including how unnecessarily rigid rules have both failed to

adhere to these values and often led to more expensive supports than necessary.

Recommendation 3: The Joint Committee of Public Accounts and Audit should ensure

this Inquiry adopts the Social Model of Disability and avoids deferring to outdated

understandings of disability based on the Medical and/or Charity Models of Disability.

Likewise, the Committee should emphasise that the future course of the National

Disability Insurance Scheme (NDIS) should be based on the Social Model of Disability

and not a regression to outdated approaches and systems.

Recommendation 4: The Joint Committee of Public Accounts and Audit should examine

the consequences of practices and policies of discrimination, segregation, and exclusion

under the National Disability Insurance Scheme (NDIS) including their immediate and

long-term cost implications. It should make recommendations about ending

discrimination, segregation, and exclusion in the NDIS as part of building a higher-

quality, more cost-effective, and, ultimately, more sustainable Scheme.

Recommendation 5: The Joint Committee of Public Accounts and Audit should recognise

how flaws in the assumptions underpinning the Productivity Commission’s 2011

modelling of projected NDIS costs, largely due to underestimating the level of unmet

need at the time and a reliance on known costs that were largely associated with

outdated models, have resulted in an unrealistic benchmark and misconceptions about

the reasonable costs of the Scheme. It should consider and make a recommendation

about how a new realistic benchmark can be modelled.

Recommendation 6: The Joint Committee of Public Accounts and Audit should examine

how, and to what extent, the NDIA Board currently assures itself the National Disability

Insurance Agency (NDIA) is fulfilling its legislated functions in ways that are fully

consistent with the National Disability Insurance Scheme Act 2013.

Recommendation 7: The Joint Committee of Public Accounts and Audit should examine

how, and to what extent, the NDIA Board currently assures itself about the reliability of

data and financial projections it receives and make recommendations to address the

apparent shortcomings to protect the future of the National Disability Insurance Scheme

(NDIS) for all Australians.

Recommendation 8: The Joint Committee of Public Accounts and Audit should closely

examine the role of the Board in the apparent failure of the National Disability Insurance

Agency (NDIA) over many years to identify and fix inadequate systems and processes

resulting in extremely high levels of waste, fraud, and financial leakage from the NDIS. It

should make recommendations to improve the Board’s identification and mitigation of

risks within the Agency and Scheme.

Recommendation 9: The Joint Committee of Public Accounts and Audit should ensure its

recommendations reflect a clear balance between the multiple roles of the National

Disability Insurance Agency (NDIA) Board and give equal weight to matters of financial

sustainability and the quality of participant outcomes capable of advancing the life

chances of participants, which reduces costs over the long term.

Recommendation 10: The Joint Committee of Public Accounts and Audit should consider

and make recommendations about how the National Disability Insurance Agency (NDIA)

Board can increase the level of public transparency regarding its work and deliberations

to help ensure public confidence in its role is maintained and enhanced.

Recommendation 11: The Joint Committee of Public Accounts and Audit should consider

how an additional public disclosure requirement could be added to Section 145 of the

National Disability Insurance Scheme Act 2013 so that advice from the Independent

Advisory Council to the National Disability Insurance Agency (NDIA) Board is made

available publicly.

Recommendation 12: The Joint Committee of Public Accounts and Audit should

recommend the Federal Government establishes a genuine co-design process involving

lived experience and subject matter experts in decision making to develop, trial, adjust,

roll out, and evaluate Foundational Supports, including Thriving Kids, because this

approach offers the best chance of success. The sustainability of the National Disability

Insurance Scheme (NDIS) will be significantly enhanced if Foundational Supports are

well designed and effectively rolled out through a constructive partnership with the

disability community.

Recommendation 13: The Joint Committee of Public Accounts and Audit should consider

how the Information, Linkages, and Capacity Building (ILC) program can be strengthened

into the future, including, but not limited to, an increased funding allocation, financial

certainty for organisations, and a clear overarching public-facing strategy. The

Committee should also seek to understand why organisations with ILC-funded projects

are facing an unknown future come 30 June 2026 – for the third year in a row – and make

recommendations to avoid any recurrence of this issue in the future.

Recommendation 14: The Joint Committee of Public Accounts and Audit should consider

the many benefits of establishing genuine co-design processes involving lived

experience and subject matter experts in decision making for the success of reform

processes and make a clear recommendation that the Federal Government adopt this

approach regarding the National Disability Insurance Scheme (NDIS) and Foundational

Supports.

Recommendation 15: The Joint Committee of Public Accounts and Audit should

recommend ways to rebuild trust between the Federal Government, including its

agencies, and the disability community with a focus on working together to achieve

better outcomes for the quality and sustainability of the National Disability Insurance

Scheme (NDIS).

Recommendation 16: The Joint Committee of Public Accounts and Audit should examine

the adequacy of oversight and accountability mechanisms in the National Disability

Insurance Scheme (NDIS) and make recommendations to ensure these are placed at the

core of the Scheme.

Recommendation 17: The Joint Committee of Public Accounts and Audit should

recommend a recalibration of key roles and responsibilities in the National Disability

Insurance Scheme (NDIS), including, but not limited to, the roles of Local Area

Coordinators (LACs), NDIA planners, support coordinators, and plan managers in order

to make the Scheme more cost-effective and sustainable.

Recommendation 18: The Joint Committee of Public Accounts and Audit should examine

the complex and expensive participant pathway currently operating in the National

Disability Insurance Scheme (NDIS) and recommend participants ‘author’ their own plans

based on their assessed budget with available support from their Local Area Coordinator

(LAC), who is trained in best-practice supported decision making.

Recommendation 19: The Joint Committee of Public Accounts and Audit should examine

the complex, adversarial, and expensive process for approving supports in NDIS plans

through the current lists approach and make recommendations to simplify the rules and

replace the lists with clear principles that encourage innovative and lower-cost solutions.

Recommendation 20: The Joint Committee of Public Accounts and Audit should

recognise the cost-effectiveness of informal natural safeguards for people with disability

living in inclusive neighbourhoods and communities and consider ways these can be

enhanced alongside adequate investment in strong formal oversight and accountability

mechanisms.

2. Introduction

JFA Purple Orange welcomes the opportunity to provide this submission to the Joint Committee

of Public Accounts and Audit regarding its inquiry into the administration of the National

Disability Insurance Scheme (NDIS).

We understand the Committee is examining the National Disability Insurance Agency’s (NDIA)

delivery of the NDIS with reference to the management of financial sustainability risks, and

claimant and provider compliance with requirements; as well as the monitoring, measurement,

and reporting of NDIA performance. Further, the Committee will also examine the regulatory

performance of the NDIS Quality and Safeguards Commission (NDIS Commission), and the

Department of Health, Disability, and Ageing’s policy advice to the government. We note that

this Department was only constituted in its current form last year with the Department of Social

Services taking the lead policy advice role for disability and the NDIS prior to this.

JFA Purple Orange acknowledges there have been a range of mistakes and problems created

in the way successive governments have rolled out and managed the NDIS and these have

unnecessarily increased the cost of the Scheme. But we cannot emphasise strongly enough

that poor implementation does not turn a good idea into a bad one. The NDIS was and

remains a fundamentally good idea that should be defended and strengthened to ensure

it delivers its original promise. Our collective focus should be on fixing the problems and

building a stronger Scheme that delivers higher quality supports and better outcomes. Winding

back or dismantling parts of the NDIS now would discard the enormous value already created

from the investment so far. A full or partial return to block funding will bring new and different

expenses with little evidence to suggest it will be cheaper over the long term. The primary

reason that these types of service provisions seemed cheaper prior to the NDIS is because

there was so much unmet need and poor service quality.

We despair at characterisations that suggest there is a single choice between a ‘free-market

free-for-all’ or a rigid, government-controlled, block-funded, one-size-fits-all service provision.

We believe there is a credible middle path that can deliver high-quality outcomes for participants

who have genuine choice and autonomy to live good ordinary lives while ensuring the financial

sustainability of the Scheme. Clear straightforward processes, fit-for-purpose oversight

mechanisms, and strong accountability are critical to this middle path; all of which have been

lacking in the NDIS to date. We implore all members of this Committee, and parliament more

broadly, to work together, and alongside the disability community, to improve the NDIS and

ensure it fulfills its promise to enable Australians with disability to live valued meaningful lives in

our communities – something that enriches all of us.

Compounding successive governments’ poor implementation of the NDIS has been the chaotic,

disjointed, and often inept way they have also sought to run various ‘reform’ processes. Despite

commitments to genuinely co-design changes to the Scheme, people with disability have largely

been sidelined with governments and ministers taking charge, then failing to match their rhetoric

with results. The NDIS has now been under ‘reform’ for more than half its 12-and-a-half-year

lifespan, kicked off by Stuart Robert when he assumed the role of Minister for the NDIS on 29

May 2019 and carried forward by ministers Linda Reynolds, Bill Shorten, Amanda Rishworth,

and Mark Butler. The disability community and broader Australian public can be forgiven for

wondering why the experiences and outcomes for participants seem to be getting worse and the

political rhetoric about cost overruns continues into its tenth year.¹

In our view, this is because the approaches taken to ‘reform’ so far have not worked as well as

they should have, and we respectfully argue it is well past time to adopt a genuine

comprehensive co-design process that includes lived experience and subject matter expertise in

decision making, implementation, and evaluation to ensure the NDIS is fit-for-purpose now and

into the future. The co-design that has occurred in recent years has been on specific matters

and in piecemeal ways – there has not been a comprehensive, cohesive, overarching co-design

approach for the whole Scheme. It is people with disability and their families who have the most

experience of the Scheme’s benefits and problems, the deepest understanding of how it

currently works, and the greatest stake in its success. They should be trusted to help lead,

design, and deliver the sensible changes that are needed to create a high-quality sustainable

Scheme that achieves its original promise.

Our submission is presented in three parts. First, we focus on the foundations of the NDIS and

why it came into being. Understanding the origins and the path taken to date is crucial to

charting a better course forward that holds true to the fundamental essence of the Scheme.

Then we address problems with implementation. Third, we look forward, emphasising that a

genuine co-design process offers the best chance of delivering sensible change that improve

the quality and sustainability of the NDIS. We also offer a few ideas that we believe would help

strengthen the Scheme and save money, which should be considered in that co-design

process. Our submission is informed by feedback we have received from people with disability,

¹ On 20 January 2017, then Treasurer Scott Morrison asked the Productivity Commission to undertake a study of NDIS costs. See further Productivity Commission, ‘National Disability Insurance Scheme (NDIS) Costs: Study Report’, October 2017, available at https://assets.pc.gov.au/inquiries/completed/ndis-costs/report/ndis-costs.pdf.

families, and other stakeholders about their experiences and we acknowledge the ongoing and

valuable contributions that the South Australian disability community makes to our work.

2.1. Problematic scope of this Inquiry

While the scope of this Inquiry is comprehensive in relation to the public service’s roles in the

administration of the NDIS, it excludes political actors who have had a significant impact on how

well the NDIS has been implemented and managed, as well as the conduct of subsequent

‘reform’ processes, as described above. The roles of successive governments – predominately

federal but also state and territory governments – and their ministers should not be overlooked.

Additionally, many previous parliamentary committees have examined a smorgasbord of

matters related to the NDIS over a dozen years, yet they have seemingly been unable to direct

governments to solutions that would have prevented the problems that many now use to argue

the NDIS has failed.

We are very concerned that the narrow scope of this Inquiry may hamper its ability to accurately

pinpoint the root causes of many issues and, therefore, their solutions. Instead, it enables

current and former politicians to avoid their share of scrutiny while only placing the public

service under the microscope. We strongly urge the Committee to expand its scrutiny to include

all actors who have significantly impacted the administration of the NDIS, especially ministers.

Otherwise, there is a risk that policy design flaws are overlooked with the focus only on day-to-

day operations, or of a perception forming that the public service is being ‘scapegoated’ for

broader government failings.

Recommendation 1: The Joint Committee of Public Accounts and Audit should expand

its Terms of Reference to include the impact of political actors, especially ministers, on

the administration of the National Disability Insurance Scheme (NDIS) and its

performance regarding the quality of supports provided to participants, outcomes

achieved, mitigation of Scheme risks, and management of financial sustainability.

3. Foundations of NDIS critical to inform its future

Understanding the origins of the NDIS and the path taken to date is crucial to charting a better

course forward that holds true to the fundamental essence of the Scheme. In this section, we

highlight some of the core foundations of the NDIS that we believe should inform how the

Committee undertakes its work and the recommendations it makes. We emphasise the

groundbreaking work of the ‘Shut Out’ report in encapsulating the need for change away from

the outdated approaches of the past, and the importance of the Committee’s work reflecting the

Social Model of Disability and that segregated models have no place in a genuinely inclusive

society.

3.1. Original promise still holds true

The NDIS has many ‘parents’ and ‘grandparents’, but, in our view, the landmark ‘Shut Out’

report released in 2009 best encapsulates why the Scheme is needed and the essence of what

it should achieve. We implore each member of this Committee to take the time to read and

reflect on the content of this report and its call for fundamental change. Its core tenets of dignity

and inclusion for all Australians with disability should underpin the work of this Inquiry. We do

not suggest that the NDIS has, to date, done justice to the change the report called for, but we

strongly believe this should continue to motivate and guide how the Scheme evolves into the

future. As a person with disability shared in a submission to the ‘Shut Out’ report team:

We desire a place within the community! This place is not just somewhere to lay

down our heads, but a place which brings comfort and support with daily living,

friendship, meaningful work, exciting recreation, spiritual renewal, relationships in

which we can be ourselves freely with others. And out of this, great things may

flourish… Perhaps then we will belong and our gifts (perhaps meagre, perhaps

spectacular) freely shared. And from there will flow all the delights and tragedies

of a life lived in the community, shaped not by exclusion and oppression but by

everyday ordinariness (whatever that might be)!²

The NDIS has sought to achieve these core tenets of dignity and inclusion through a

commitment to reasonable and necessary supports based on choice and a goal of advancing

participants into meaningful social, economic, cultural, and community participation. Yet, we

² Australian Government, ‘Shut Out: The Experience of People with Disabilities and their Families in Australia’, 2009, p. viii, available at https://disability.royalcommission.gov.au/system/files/exhibit/DRC.1000.0001.0001.pdf.

have seen numerous examples of the NDIA failing to properly uphold these, even when doing

so would be much cheaper. One example is the requirement for supports to be ‘disability

specific’, which undermines the goal of social participation and genuine community inclusion.

For example, when participants request support to participate in mainstream community-based

art or music activities, this has been rejected because they are not considered to be a disability-

specific support. Anecdotally, Local Area Coordinators (LACs) and NDIA planners have then

suggested to many participants that more expensive art and music therapies would be an

alternative way to fund these activities because they are deemed disability-specific and within

the rules. Other participants have then followed this lead and also sought funding for art and

music therapies for non-therapeutic reasons. This approach is failing to achieve the goal of

community participation and has directed many participants into more expensive supports than

they were seeking. It is but one example of how rigid rules have led to poorer participant

outcomes from more expensive supports.

Recommendation 2: The Joint Committee of Public Accounts and Audit should reflect on

the content of the landmark ‘Shut Out’ report and its core tenants of dignity and

inclusion in considering how the National Disability Insurance Scheme (NDIS) has been

rolled out and managed, including how unnecessarily rigid rules have both failed to

adhere to these values and often led to more expensive supports than necessary.

The NDIS has long suffered from the mischaracterisation of it as a ‘welfare’ measure. Now, with

responsibility for the NDIS moved to the Department and Minister for Health, there is an equally

concerning pattern of mischaracterising the Scheme as a ‘care’ system and viewing disability as

a ‘problem’ to be ‘fixed’ rather than an ordinary part of human diversity. This is in line with the

outdated Medical and Charity Models of Disability rather than the contemporary Social Model of

Disability. To be clear, the NDIS is an insurance scheme, and it is intended to provide a broad

range of supports that enable Australians with disability to take up their rightful place as equal,

included, and contributing citizens with the same opportunities to pursue their interests and

reach their full potential as all others. As the Social Model of Disability makes clear, people with

disability are not ‘damaged’ or inherently ‘vulnerable’ and in need of others’ care and charity.

Instead, disability arises from the widespread barriers that exist in a world not designed to

include everyone. These barriers may be physical, systemic, social, communicational, or

attitudinal and should be the primary target of change and reform. It is essential Committee

members undertake this Inquiry in line with the Social Model of Disability and avoid deferring to

outdated understandings of disability based on the Medical and Charity Models of Disability.

At JFA Purple Orange, we characterise the benefits of the NDIS to individuals in two broad

categories: transactional and transformational. To understand the difference, we consider the

nature of the consequences of disability. First, there are consequences that impact on daily life

that result in the need for practical supports, such as for toileting, that reoccur over time. These

are transactional benefits. Second, there are consequences that impact on life chances that

require supports designed to create permanent positive change, for example speech therapy,

that will enable the pursuit of life goals. These are transformational benefits. While it may,

broadly speaking, be possible to characterise transactional benefits as part of a system of ‘care’

(although not recommended), this terminology is wholly inadequate in describing what the NDIS

was designed to achieve. Hence, our reiteration that the NDIS is an insurance scheme

designed to deliver transformative benefits in the lives of people with disability, which reflects

the fact that any Australian could acquire a disability at any stage of life and benefit from these

supports to enable them to live a good ordinary life in their community. For more information

about transactional and transformational benefits, we urge Committee members to engage with

the papers in our NDIS Review Conversation Series,³ which are available here.

Recommendation 3: The Joint Committee of Public Accounts and Audit should ensure

this Inquiry adopts the Social Model of Disability and avoids deferring to outdated

understandings of disability based on the Medical and/or Charity Models of Disability.

Likewise, the Committee should emphasise that the future course of the National

Disability Insurance Scheme (NDIS) should be based on the Social Model of Disability

and not a regression to outdated approaches and systems.

3.3. Inclusion is not segregation

Further to the above discussion about the importance of dignity and inclusion to the NDIS, it is

essential to underscore what these are not: dignity and inclusion are not any form of

segregation or separate ‘special’ settings and programs. ‘Special’ provisions are inherently

more expensive than making mainstream settings and programs work for everyone and,

therefore, they undermine the sustainability of the NDIS. The NDIS should be part of a broader

strategy to end the segregation of people with disability in any setting, including in housing,

³ JFA Purple Orange, ‘NDIS Conversation Series’, 2023, available at https://purpleorange.org.au/news- resources/ndis-conversation-series.

education, and employment. Segregated and congregated services will not advance people with

disability into meaningful contributing lives in community in the way well-orchestrated inclusive

alternatives do. Separate ‘special’ disability-focused services, programs, and settings reinforce

a community perception that people with disability are best served by having separate ‘special’

stuff. This has been termed ‘othering’.

The broader context here is important. The progress Australia has made toward

deinstitutionalisation has unfortunately not resulted in an end to the segregation of children or

adults with disability. Indeed, in numerous instances, it has simply heralded the creation of new

forms of exclusion, marginalisation, and inequality in Australia, particularly in housing,

education, and employment. Children and adults with intellectual disability and those with

multiple or complex disabilities or high support needs are more likely to be funnelled into

segregated and congregated settings and services. These settings are highly institutionalised in

their character, and this has serious impacts on the quality of life for those relegated to these

offerings. They have significant impacts on each person’s quality of life and the opportunities

available to them as they move through life stages – from infancy to childhood to adolescence

to adulthood to older age.

The findings from the Disability Royal Commission (DRC) offer a compelling argument in terms

of understanding why people are drawn into segregated disability-specific settings. The Final

Report recognises that people with disability and their families are systematically taught there

are no safe or viable mainstream options, forcing them to access segregated settings,

something that can be described as ‘coercive choice’.⁴ Often, people with intellectual disability

are funnelled from ‘special schools into a sheltered workshop, known as an Australian Disability

Enterprise (ADE) and a group house; a trajectory that Catherine McAlpine, CEO of Inclusion

Australia, calls ‘The Polished Pathway’.⁵ Not only does this Pathway severely limit a person’s

opportunities and prospects for taking up meaningful valued roles in our communities, it

perpetuates underlying messages that people with disability do not belong in community, are

lesser or defective, and it is okay to devalue people and treat them as second-class citizens.

These messages are deeply entrenched in society and are a consequence of the legacy of

institutionalisation and ongoing policies and practices of segregation.

It is in this broader context, and because of this context, that people with disability and their

families are forced to turn to segregated disability-specific settings and services. When

⁴ Disability Royal Commission, ‘Final Report, Volume 7: Inclusive education, employment, and housing - Summary and recommendations’, 2023, p.65, available at https://disability.royalcommission.gov.au/publications/final-report. ⁵ See, for example, Catherine McAlpine’s speech to the NDIS Jobs and Skills Summit on 17 August 2022, at https://www.inclusionaustralia.org.au/wp-content/uploads/2022/10/The-Polished-Pathway-Final.pdf.

mainstream options continue to operate in ways that are inaccessible, exclusionary, and/or

discriminatory, these options are taken away. People become exhausted and disillusioned by

repeated poor and unsafe experiences and begin to perceive segregated options as ‘easier’ to

deal with. It cannot be left to the disability community alone to shoulder the responsibility to

change this reality. It requires all levels of government – and Committees like this one – to take

a strong position against disingenuous claims, particularly those of sector lobbyists with vested

interests, that segregated options can constitute ‘choice’. ‘Choices’ made in a context where

safe, high-quality, and inclusive alternatives are not available are not genuine choices.

Notwithstanding this, it is important to note that people with disability can and do have positive

meaningful relationships with their peers who also have disability. These relationships do not

constitute segregation or congregation and are not an excuse for such policies and practices.

We fully support the funding of peer networks, associations, and similar, and emphasise the

value of these opportunities in the lives of people with disability. There is a clear distinction

between funnelling people into segregated disability-specific settings in the absence of any

ordinary alternatives being available, compared to the availability of peer networks and spaces

led by and for people with disability. The latter is generally a freely chosen association that can

exist among a smorgasbord of options and form only one aspect of a person’s life, as opposed

to being shut out of community altogether as a consequence of segregation. Many families with

various cultural heritages gather for positive community fellowship without being restricted to

only living, learning, and working with people who share that particular characteristic in

segregated settings – such an approach would rightly appal most Australians. Peer networks

and similar provide genuine opportunities to develop freely given meaningful connections and

facilitate a sense of identity, belonging, value, and respect. They support the growth and mutual

support that leads to self- and group-advocacy to enable positive life experiences. However,

they should also never detract from full and meaningful inclusion in mainstream community life.

Recommendation 4: The Joint Committee of Public Accounts and Audit should examine

the consequences of practices and policies of discrimination, segregation, and exclusion

under the National Disability Insurance Scheme (NDIS) including their immediate and

long-term cost implications. It should make recommendations about ending

discrimination, segregation, and exclusion in the NDIS as part of building a higher-

quality, more cost-effective, and, ultimately, more sustainable Scheme.

5. Missteps in NDIS implementation

We now turn to some of the problems that have undermined the implementation of the NDIS

resulting in lower quality supports for participants, poor management of risks and reduced

sustainability. As we have already acknowledged, there have been many mistakes and

problems created in the way successive governments have rolled out and managed the NDIS,

and these have increased the cost of the Scheme. Poor implementation of the NDIS does not

mean the Scheme is a bad idea or should be wound back in any way. Instead, it means the

focus should be on working together to make sensible changes that will improve the quality and

sustainability of the Scheme. Below, we raise some of the issues that have impacted the

implementation and administration of the Scheme.

5.1. Scheme forecasts overlooked significant unmet need

From the beginning, forecasts about the likely cost of the NDIS failed to properly account for the

high levels of unmet and unfunded need among both people who were receiving some support

within state government block-funded systems but not having their needs properly met, and

people who were excluded entirely, particularly those relying on family or other informal

supports. These inaccurate forecasts, particularly those in the 2011 report of the Productivity

Commission, have created a perception among some that the need that is now evident cannot

be ‘real’ because it was not predicted and, therefore, many people must be defrauding the

system. While we do not doubt there is some inappropriate claims and activities in the NDIS, in

large part the gap between predictions and reality is attributable to the inaccurate initial

understanding of the level of community need that was not being met. Throughout history,

people with disability have been segregated and excluded from communities and their needs

rendered invisible to government systems and data collection. Therefore, this modelling is a

problematic benchmark to continue to compare current and future costs of the Scheme to.

It would be very useful for the Committee to recognise this and make recommendations about

the credibility of continuing to refer to these predictions, as well as to consider the potential

opportunities to undertake a new, more robust, assessment of the current level of met and

unmet need in the Australian community. This should occur in line with today’s reasonable

community expectations of the level and quality of support required to live a good ordinary life

rather than against the bare minimum required for the shared, segregated, institutionalised,

block-funded services of the past. Arguably, the costs of the latter were too influential in the

original cost projections for the NDIS because it was all that was known at that time. Almost 15

years on from the Productivity Commission’s original modelling, there would be significant value

in independently modelling needs and realistic costs based on the information that is now

available.

Recommendation 5: The Joint Committee of Public Accounts and Audit should recognise

how flaws in the assumptions underpinning the Productivity Commission’s 2011

modelling of projected NDIS costs, largely due to underestimating the level of unmet

need at the time and a reliance on known costs that were largely associated with

outdated models, have resulted in an unrealistic benchmark and misconceptions about

the reasonable costs of the Scheme. It should consider and make a recommendation

about how a new realistic benchmark can be modelled.

5.2. Poor performance of NDIA Board

The NDIA Board oversees the work of the Agency and is one of the most important roles in the

administration of the NDIS. Yet this role has fallen well short of what has been needed and what

is reasonably expected of a Board. Rather than providing strong leadership and governance,

the Board has taken a backseat to Ministers and Agency executives. This has had significant

consequences for the cost of the NDIS. As the Committee will be aware, the main functions of

the Board are set out in Section 124 of the National Disability Insurance Scheme Act 2013 as

ensuring ‘proper, efficient and effective performance of the Agency’s functions’ and determining

‘objectives, strategies and policies to be followed by the Agency’. The Agency’s functions under

Section 118 of the Act include delivering the NDIS in a way that:

Supports ‘the independence, and social and economic participation, of people with

disability’;

Enables ‘people with disability to exercise choice and control…’;
Ensures ‘the decisions and preferences of people with disability are respected and given

appropriate priority’;

Promotes ‘the provision of high quality and innovative supports that … maximise

independent lifestyles and inclusion in the community’; and

Ensures a ‘reasonable balance is achieved between safety and the right of people with

disability to choose to participate in activities involving risk’.

The current Board arrangements do not appear to be adequately fulfilling these governance

obligations or preventing the NDIA pursuing activities that are inconsistent with its legislated

functions. Currently, the voice of the Board seems to have a lower profile than the role

articulated in the Act. The following subsections of this submission, below, provide examples of

apparent insufficient Board oversight that we believe warrant close investigation in this Inquiry.

Importantly, our input is not a criticism of any individual Board members; rather, the focus of our

feedback is to reflect on how the current Board arrangements have not led the NDIA to deliver

the Scheme’s intended outcomes and financial stewardship, and to urge the Committee to seek

to understand why and make recommendations that will ensure this changes.

5.2.1. Insufficient Board oversight of quality outcomes

It is currently unclear how the Board assures itself that the NDIS is effectively, and to the

greatest extent possible, advancing people with disability into lives of independence and

genuine social and economic participation, per its legislated functions listed above. The same is

true of progressing individual choice and control. Likewise, it is unclear if or how the Board

seeks to understand the quality of provider supports or the extent of innovation in the market.

There is, however, significant evidence of the NDIA deploying practices, making decisions, and

measuring outcomes in ways that are contrary to fulfilling these legislated functions and we

describe a few instances below.

Board governance has not been strong enough to ensure the NDIS achieves transformational

outcomes for many participants. Instead, successive Boards have presided over a Scheme that

is highly transactional, where participants receive something rather than nothing, but the

‘something’ is often not the supports that will make a critical difference to their life chances. In

some instances, as mentioned earlier in this submission and explained further below, the less

impactful support that is provided in a plan is more expensive than the type of support that

would make a greater difference in a participant’s life. The Board does not appear to have

addressed this misalignment between plan decision making and NDIA functions in any

meaningful way.

Regarding advancing people into social and economic participation in the community, the NDIA

is known to make decisions to fund supports that are segregated from community rather than

those that are more likely to build connections and foster genuine inclusion. There continues to

be a default assumption in NDIA decision making about funding for home and living supports

that forces participants into group living arrangements not of their choice with quasi-block

funded Supported Independent Living (SIL) supports that prevent independent choice and

autonomy. In its governance role, the Board has not ensured the NDIA has pursued alternative

models of home and living support that would align more closely with NDIA functions. Nor has it

sought to test and challenge the imagined financial constraints of individual support and choice

through innovation. For example, it is hard to see any evidence of Board leadership in directing

the NDIA to purposefully advance Independent Living Options (ILO) as a core part of the

Scheme and as a critically important alternative to the group house model that is expensive,

inflationary, and does not deliver on Scheme values of choice inclusion.

As mentioned earlier, the NDIA has also shown a preference for costly one-to-one therapy with

a professional rather than cheaper mainstream community activities that are not regarded as

disability-specific supports despite the obvious perverse outcome this produces. This

unnecessarily directs people into therapy settings rather than genuine community participation.

In other words, it is costing more to deliver worse outcomes. This should raise concerns for the

Board not only in relation to effective outcomes but also the effective management of NDIS

resources and the prevention of waste. Further, the NDIA’s measurement of social participation

does not consider the nature or quality of participation, only the rate, therefore poor-quality

activities of ‘community tourism’, whereby a person is taken to a community setting but does not

actually participate in community life, are countered in social participation statistics as if they

constitute genuine social participation.

A similar picture emerges regarding economic participation, albeit with somewhat more reliable

data. According to the latest ‘NDIS Quarterly Report’, only 23 per cent of participants of working

age in the Scheme for at least two years had a paid job.⁶ This statistic has barely moved in eight

years from 22 per cent on 30 June 2018.⁷ There continues to be entrenched low expectations

for the employment outcomes of people with disability in Australia more broadly, with recent

data from the Australian Bureau of Statistics (ABS) counting only 60.5 per cent of people with

disability of working age as part of the labour force (working or available to work) compared to

84.9 per cent for people without disability.⁸ Addressing discrepancies like this was one of the

reasons the Productivity Commission recommended the establishment of a new national

disability scheme in its 2011 Report. Indeed, the assumed ‘significant economic and

employment effects’ of a scheme was a major element of how the Productivity Commission

justified its creation,⁹ hence the focus on economic participation in the legislated functions. This

⁶ National Disability Insurance Scheme, ‘NDIS Quarterly report to disability ministers’, 30 September 2025, available at https://www.ndis.gov.au/about-us/publications/quarterly-reports. ⁷ National Disability Insurance Agency, ‘Employment Outcomes: 30 June 2018 - NDIS participants, their families and carers’, p.23, available at https://dataresearch.ndis.gov.au/reports-and-analyses/outcomes-and- goals/employment-outcomes-participants-their-families-and-carers. ⁸ Australian Bureau of Statistics (ABS), Disability, Ageing, and Carers, Australia: Summary of Findings: 2022, released 4 July 2024, available at https://www.abs.gov.au/statistics/health/disability/disability-ageing-and-carers- australia-summary-findings/latest-release#disability. ⁹ Productivity Commission, ‘Disability Care and Support,’ Report no.54, 2011, p.960, available at https://www.pc.gov.au/inquiries/completed/disability-support/report.

increased economic participation was supposed to help offset the costs of the NDIS and make it

more sustainable, but this has not been given the required level of attention.

In addition to misaligned practices, decisions, and outcomes, the NDIA is also failing to deliver

participant outcomes commensurate with the level of expenditure in the Scheme, which now

approaches $50 billion per year. We would expect the Boad to have a stronger mandate to

direct the NDIA in achieving the transformational outcomes required by the legislated functions,

improve cost-effectiveness, and to have greater oversight of shortcomings in order to work with

the Agency’s executive leadership to rectify these. To this end, we urge the Committee to

examine what processes the Board undertakes and what information it seeks from the NDIA to

satisfy itself that the legislated functions of the Agency are being fulfilled purposefully and

effectively and are resulting in the participant outcomes required.

Recommendation 6: The Joint Committee of Public Accounts and Audit should examine

how, and to what extent, the NDIA Board currently assures itself the National Disability

Insurance Agency (NDIA) is fulfilling its legislated functions in ways that are fully

consistent with the National Disability Insurance Scheme Act 2013.

5.2.2. Insufficient Board oversight of Scheme sustainability

Subsection 4(17) of the Act also directly requires the Board, among others, to have ‘regard to

the need to ensure the financial sustainability’ of the NDIS. Again, it is unclear how the Board

assures itself of the sustainability of the Scheme or that the projections that the NDIA relies on

to anticipate costs are accurate. Instead, there is ample evidence to demonstrate a track record

of projections that do not materialise as expected. This problem was highlighted extensively in

the Australian Government Actuary’s ‘Independent Actuary Peer Review Report’¹⁰ of the

Scheme Actuary’s ‘Annual Financial Sustainability Report’ (AFSR)¹¹ provided to the Board in

October 2023. We describe some of the issues below to demonstrate the questionable nature of

some of the information provided to the Board and the apparent failure of the Board to fully

scrutinise this, resulting in consequences for Scheme sustainability.

Among the Independent Actuary’s concerns are the differences between the projections and

outcomes on a number of key participant indicators related to sustainability: ‘Last year, new

¹⁰ Guy Thorburn, Australian Government Actuary, Independent Actuary Peer Review Report of the Annual Financial Sustainability Report 2022-23, 16 October 2024, available at https://www.ndis.gov.au/about- us/publications/annual-financial-sustainability-reports. ¹¹ David Gifford, Scheme Actuary, National Disability Insurance Scheme, ‘Annual Financial Sustainability Report 2022-23’, available at https://www.ndis.gov.au/about-us/publications/annual-financial-sustainability-reports.

entrants were 22% higher than expected and exits, for reasons other than death, were 40%

lower than expected. The number of participants receiving SIL is now 12% higher than

expected.’¹² Although only five per cent of participants receive SIL supports, their plans account

for 30 per cent of total funding in participant plans¹³ so any variation in projections related to

participants with SIL supports produces greater cost impacts for the Scheme. As described

above, SIL supports is one of the main areas where NDIA decision making is contrary to

legislated functions and inflating the cost of the Scheme.

Further, the Independent Actuary questioned the Scheme Actuary’s assumption that the

number of potential new entrants with ‘previously unmet need’ (PUN) is finite and will no longer

be a factor in projections after three years (by 2026):

There is a significant level of judgement behind the hypothesis that there will be

no new entrants with a PUN after three years. I have not received any analysis to

support this assumption. Defence Superannuation schemes have a similar cohort

of claimants. The analogous cohort in these schemes submit retrospective

invalidity claims. The past decade has seen the number of such claims increase

steadily, with some claims being made many decades after the incidence of the

disability. Previous assumptions that the numbers would reduce in the short term

have consistently proven to be wrong.¹⁴

Hence, the Independent Actuary found: ‘The uncertainty surrounding new entrant assumptions

and their assumed moderation is a key contributing factor to my conclusion that the Baseline

projection is more likely to understate, rather than overstate, future costs.’¹⁵

The Independent Actuary also raised similar concerns about the reliability of moderating growth

projections in recent Financial Sustainability Reports, concluding: ‘This moderation has so far

failed to materialise, and the projections have been increased each year since 2019.’¹⁶

Therefore, the Independent Actuary expressed concern that the current projection about

Scheme sustainability is also likely to be unreliable:

I believe that this projection faces a similar risk as all projections since 2019, that

is, that the assumed moderation does not materialise. Until the assumed

¹² Guy Thorburn, Australian Government Actuary, Independent Actuary Peer Review Report of the Annual Financial Sustainability Report 2022-23, 16 October 2024, p.9, available at https://www.ndis.gov.au/about- us/publications/annual-financial-sustainability-reports. ¹³ Ibid, p.6. ¹⁴ Ibid, p.16. ¹⁵ Ibid, p.5. ¹⁶ Ibid, p.12.

moderating experience shows a greater presence in the data, there remains a risk

that the Baseline projection understates what might occur.¹⁷

Additionally, the Independent Actuary pointed out a significant gap between projected Agency

operational costs and current budget allocations per the forward estimates in the 2023-2024

Federal Budget: ‘projected operational expenses … are 37% higher than budgeted expenses in

2026-27. To the extent that forecast outcomes are dependent on agency resourcing in the

medium term, these differences will need to be reconciled.’¹⁸

Recognising the above sample of concerns raised in the independent peer review of the

projections relied upon to forecast moderations in future Scheme demand and costs, it would

appear the Board would be expected to have significant concerns – even alarm – about the

reliability of the information it is provided and the impacts this will have on the future of the

NDIS. There needs to much greater urgency in addressing the poor quality of data and

projections to ensure the future of the Scheme and its capacity to deliver high-quality outcomes

for participants is protected. Consequently, we urge the Committee to examine this very closely.

Recommendation 7: The Joint Committee of Public Accounts and Audit should examine

how, and to what extent, the NDIA Board currently assures itself about the reliability of

data and financial projections it receives and make recommendations to address the

apparent shortcomings to protect the future of the National Disability Insurance Scheme

(NDIS) for all Australians.

5.2.3. Insufficient Board oversight of systems and processes

As we are sure the Committee is aware, there has been significant political rhetoric and public

discourse about fraud in the NDIS. Of course, we share concerns about any misuse or

misconduct in the Scheme and wholeheartedly support actions against this. However, given the

degree to which NDIS cost increases are now attributed to fraud and other nefarious behaviour

within the Scheme, it seems prudent to question if and how the Board provided sufficient

oversight of the Scheme over the many years in which this problem apparently grew and

developed. A key part of the role of any Board is to ensure an entity is cognisant of all its risks

and ensure it is not exposed to high levels of fraud. Hence, we urge the Committee to consider

both the extent to which cost increases are genuinely linked to fraud rather than wasteful

¹⁷ Ibid. ¹⁸ Ibid, p.9.

systems that are not fit for purpose and, to the extent there is fraud, how the Board has

responded in order to prevent and remedy this.

One specific concern arises from the acknowledgement of ‘immature’¹⁹ systems and processes

within the NDIA. This raises an obvious question as to if and how the Board satisfied itself that

the Agency’s systems and processes were not exposing the Scheme to excessive risk over

many years. To this end, we draw the Committee’s attention to a range of statements made in

evidence to a Senate Estimates hearing in 2024. In doing so, we recognise that all systems,

including those of governments, are at a level of risk in terms of being targeted for fraud. The

question we pose is whether the Board’s risk identification process was sufficient in recognising

the problems, if the level of risk was within reasonably tolerable parameters, and, if not, as

would appear to be the case based on political rhetoric, what steps the Board took to ensure

unacceptable levels of risk were mitigated and system weaknesses fixed. Below, is a small

sample of statements John Dardo, Deputy Chief Executive Officer, Integrity Transformation and

Fraud Fusion Taskforce, gave to Senate Estimates in June 2024 that seem to support the

contention that insufficient attention was paid to problems with systems and processes over

many years, allowing the level of waste, fraud, and other financial loses in the NDIS to reach

extraordinarily high levels without an appropriate response:

Statement regarding how payments have been processed over many years:

As we look at many of these claims and many of these providers, what we’re

seeing is that the behaviours have been going on for years. It’s just that we’re

better now at seeing them and preventing or stopping them.²⁰

Statements regarding immature NDIA systems:

The systems are so immature that some of the channels that participants could

claim through require no ABN, no description, no word—nothing. They can put on

a dollar amount and they get paid. So, until we actually go and do integrity work,

it’s impossible to find out what they’re actually claiming for. I’ll give you an

example. A participant on a $480,000-a-year plan divides that up by 12, claims

$40,000 a year, puts that in as a claim every month—40,000 bucks every month.

When we do the integrity work, we find out that he actually only has costs of

$20,000 a year, but because his plan is $480,000, he claims the whole amount,

and the other $20,000 goes to his mortgage or his bank account or his cost of

¹⁹ John Dardo, Deputy Chief Executive Officer, Integrity Transformation and Fraud Fusion Taskforce, at ‘Community Affairs Estimates Committee’, Hansard Draft, 3 June 2024, p.103. ²⁰ Ibid, p.96.

living. I can’t break that down into how much he spends on alcohol or on a pet or

on something else, because there is no way to unpack that. What I would say is

that what we can tell you with certainty is that the minimum error rate is five per

cent. That’s the minimum error rate. Those errors don’t include identity fraud,

fraudulent invoices, false statements, collusion and all the other stuff.²¹

There are weaknesses in the design of the system that need to be addressed. We

cannot prosecute or audit our way out of this.²²

Statement about the extent of fraud:

There are some providers that are really just fraudsters, criminals or criminal

syndicates, and they’re using the NDIS for cash flow. There are some participants

and providers that are the same thing. We have participants who have set up

businesses to pay themselves to look after themselves … it’s not clear that it’s a

provider or a participant or a nominee, because it’s all intermingled. The family

group has set up three entities, and they’re paying each other to look after each

other … There are some things there that are very intermingled between a

provider and a participant. The conflicts of interest are pretty extreme.²³

Such descriptions of the internal systems and processes demonstrate a lax approach to

establishing fit-for-purpose operations and risk identification and mitigation since the creation of

the NDIS. Hence, the problems of waste and fraud can be described as symptomatic of Agency,

Board, and Ministerial failures to ensure appropriate secure operational systems and processes

were established and maintained, rather than fraud being the root cause of the financial leakage

from the Scheme. Examining what Board deliberations and activities have taken place over the

duration of the NDIS to address the ongoing problems resulting from systems and processes

that are not fit for purpose, resulting in excessive levels of waste fraud, is likely to be very

informative for the Committee in determining the extent to which current Board arrangements

are sufficient and consistent with legislative requirements and principles of effective

governance. Indeed, it appears successive NDIA boards have simply not been up to their task

and have failed to fulfil their statutory obligations. Incidentally, the same can clearly be said of

successive Agency and ministerial leaders. In short, how could these immature systems and

processes have been allowed to operate for so long without being fixed?

²¹ Ibid, pp.101-102. ²² Ibid, p.105. ²³ Ibid, p.96.

Recommendation 8: The Joint Committee of Public Accounts and Audit should closely

examine the role of the Board in the apparent failure of the National Disability Insurance

Agency (NDIA) over many years to identify and fix inadequate systems and processes

resulting in extremely high levels of waste, fraud, and financial leakage from the NDIS. It

should make recommendations to improve the Board’s identification and mitigation of

risks within the Agency and Scheme.

5.2.4. Balancing multiple Board roles

The preceding three sections have covered the NDIA Board’s roles in ensuring the delivery of

high-quality impactful supports to participants, the sustainability of the Scheme, and the need

for fit-for-purpose operational systems and processes within the Agency. We believe it is

critically important that Board arrangements allow each of these objectives to be fulfilled

simultaneously and with appropriate balance. Any one of these functions must not distract from

the others. The Board needs to ensure tight fiscal oversight is maintained and Scheme funds

are properly accounted for and not wasted. But any outcome that elevates the accountability of

the Board for financial sustainability without giving equal attention to pursuing the delivery of

high-quality impactful supports that advance the life chances of participants, will be

counterproductive and lead to even higher costs. Delivering genuinely transformational benefits

for participants will increase their independence, create natural safeguards, and ensure

authentic social and economic participation in mainstream community life; each of which is

essential for long-term Scheme sustainability.

Recommendation 9: The Joint Committee of Public Accounts and Audit should ensure its

recommendations reflect a clear balance between the multiple roles of the National

Disability Insurance Agency (NDIA) Board and give equal weight to matters of financial

sustainability and the quality of participant outcomes capable of advancing the life

chances of participants, which reduces costs over the long term.

5.2.5. Increase Board transparency

The Committee should also consider how to introduce increased transparency of the Board’s

work and deliberations to increase public confidence in the effectiveness of the NDIS in

delivering on the Scheme’s promise. Otherwise, there continues to be a risk that the quality of

the Scheme is neglected while all the focus is on financial sustainability, yet the increase in poor

participant outcomes and ineffective supports will lead to even greater costs over the medium-

to long-term. Such a vicious cycle will be utterly counterproductive on all measures of NDIS

performance including sustainability.

In light of the above examples, we believe there is clear scope for greater public transparency

regarding how the NDIA Board has responded over the life of the NDIS. We appreciate that it

would be inappropriate to disclose everything that goes before the Board, but increased

information release would support a more informed, engaged, and ultimately trusting

relationship between the NDIA, participants, and the broader community. This could take the

form of a summary of key matters before the Board and decisions taken. It would provide the

Board with a stronger public profile, thereby enhancing its leadership role in relation to the

Scheme. This transparency could extend to interactions between the Board and the

Independent Advisory Council, which is established under Section 143 of the Act to advise the

Board. Section 145 requires the Board to share a copy of this advice with Ministers together

with a statement of the Board’s response. We suggest the Committee consider if and how this

advice and the response could also be released publicly to ensure accountability and

transparency.