Senate Community Affairs Legislation Committee’s Inquiry into

the National Disability Insurance Scheme

Amendment (Getting the NDIS Back on Track No. 1) Bill 2024

Young People In Nursing Homes National Alliance 28 May 2024

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Preface

The Alliance’s original submission to the Committee focussed on the impacts of this Bill for our core constituency – those people living in or at risk of admission to residential aged care, especially people with young onset dementia.

After reading a number of submissions to the Inquiry, including the combined Government submission from DSS, NDIA and the NDIS Commission, and hearing testimony given to the Committee at its public hearings, the Alliance’s view of the Bill has evolved.

In light of this, and clarification from the Chair of the Committee that it can only respond to the provisions of the Bill as submitted to Parliament, we wish to make the following additional recommendations to the Committee:

The Bill is unsuitable and unsafe in its current form and should be withdrawn.
Any future version of the Bill should only be introduced when the following preconditions are met:
- the Australian Government completes consultation with NDIS participants and the disability sector
- the Australian Government and the State/Territory Governments agree on the amendments to the NDIS Act, new NDIS Rules, updated version of the APTOS and Foundational Supports. These four documents should be introduced simultaneously as an integrated package, and
- the Australian Government provides a comprehensive explanation to the community about the reform package that includes:
modelling of the cost impact to the NDIS of legislative proposals and other sustainability measures including Foundational Supports
detail on what Commonwealth programs will be introduced as part of the Foundational Supports package
how people with disability will access disability supports once Foundational Supports and the new NDIS are operating (including the assessment tools, funding models, review mechanisms and case management approaches to be implemented), and
monitoring, reporting and response mechanisms for the impacts of new legislation, NDIS Rules and Foundational Supports.

We continue to advocate for the changes that we recommended in our original submission including:

a third participant pathway for individuals with progressive disability
a statutory duty of care for both the NDIS and providers
an amendment that clarifies that decisions under s34 of the NDIS Act cannot be delegated - directly or indirectly - to third parties, and
a statutory requirement for the NDIA to engage in care system planning and relevant commissioning of services.

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In addition, we strongly urge the Commonwealth to initiate an independent review of the NDIS internal review and appeals system. Specifically, we recommend consideration of changes to the NDIS Act that would require the NDIA to: § treat AAT decisions as setting the same precedent as decisions of the Federal Court, and § provide a public statement within 30 days of any published AAT decision as to:

how it has amended its policy and practices to align with the AAT findings or
the details of its appeal of the decision on a matter of law to the Federal Court.

We see these changes to the NDIS appeals system as essential both for the current NDIS Act and as a safeguard for any legislative changes.

Rationale With due regard to evidence provided to the Committee through public hearings and information gained from submissions to this Inquiry, the Alliance now considers that in its current form, the NDIS Amendment Bill will: § have impacts that are broader and deeper than are indicated in the Explanatory Memorandum and significantly disadvantage some participants § create a high-risk scenario by introducing an untested new framework for ‘NDIS 2.0’ which is missing critical elements such as jurisdictional agreement on Foundational Supports, funding models and assessment tools § not fix the key Scheme design problems that are driving the cost acceleration § transfer power to the Federal Government and away from Parliament, and § transfer risk to participants, States/Territories and providers and away from the Federal Government.

The challenge for the Committee is that under its Terms of Reference, it must inquire into and provide advice on the Bill as it is currently constituted. However, at the hearing held on 22 May 2024, the Department of Social Services flagged that the Government is already anticipating changing some of the amendments.

Without contingencies to address potential impacts to participant funding and NDIS status, there is a real risk that in its current form the Bill will have consequences that significantly advantage participants. While some of these consequences may be unintended, the Government should have anticipated these and the Parliament should ensure that they are not allowed to become law.

The absence of mechanisms to moderate or protect against such consequences, or to govern interaction with complementary service systems, only heightens these risks. Their absence also runs counter to the NDIS Review’s statement that functioning Foundational Supports should be a prerequisite for Scheme reform.

In relation to possible protective measures we note that the Bill makes no provision for: § a trial period § a sunset clause § a provision to delay the changes coming into effect until Rules are agreed with States/Territories or Foundational Supports are up and running § a Participant Impact Statement § a ‘better off overall test’ (BOOT).

The labyrinthine complexity of the Act and Scheme operations compound these risks. The Bill does nothing to reduce the hardship that even relatively minor procedural changes can deliver to participants. For example, the Agency’s recent introduction of a new identity verification protocol – something the Alliance supports – has resulted in significant delays in processing new applications from people with severe disability and urgent support needs.

While change is clearly needed to deliver a more effective, equitable and sustainable NDIS, The Alliance does not believe that this Bill – as it is currently conceived – delivers the reform that is required, nor does it lay the right foundation for collaborative reform that the NDIS Review and other advocates have called for.

Defining NDIS 2.0 The Alliance believes that the current Bill will significantly change the NDIS in both intended and unintended ways. Notably, these include:

     1.  Foregoing its role as a social insurance scheme to become a quasi 'defined benefits'

scheme. In essence, the original model of the Scheme will be set aside and the Scheme restarted with a new but untested model 2. Creating a conflict between the funding of supports under the new s10 and the Objects of the NDIS Act. In particular, s3 (1) of the objects of the Act may be compromised by the proposed s10. s3 (1) that requires the NDIS to “protect and prevent people with disability from experiencing harm arising from poor quality or unsafe supports or services provided under the National Disability Insurance Scheme”. Such a conflict could arise where the CEO denies funding for a critical support on the basis that it does not meet s10 criteria but cannot guarantee that another service system can or will provide that service or a suitable substitute 3. Shifting power from Parliament to the Executive. The Bill significantly increases the decision-making power of the Minister to regulate how the Scheme operates including how participants are admitted and supported. Should this clause be legislated, the Parliament will be entrusting powers about the Scheme’s operations to the executive level of government. This introduces a risk that key elements will be driven by political considerations.

Achieving or exceeding the desired reduction in Scheme growth costs at the expense of participant safety and welfare

The reduction in costs is expected to come from:

Reducing intra-plan inflation By scheduling the payment of funds (that is, capping them within each payment instalment period) participants will be less likely to spend their plan funds too quickly$^1$. However, this provision is also likely to lead to participants being: (i) less likely to attract support providers$^2$ (ii) more likely to be admitted to hospital if health risks (such as skin integrity, diabetes care or would care) are not adequately treated.
Reducing inter-plan inflation By extending the length of participant plans (up to or exceeding 5 years), and not providing for annual CPI or other adjustments to funding amounts, the growth in Scheme costs from inter-plan escalation is effectively capped for the duration of the plan.
The creation of two classes of participants Early intervention and lifetime participation. As the Bill is silent on the issue, it must be presumed that each class will receive different kinds and levels of support.
Significantly narrowing the range of supports that participants can purchase with their plan funds Reminiscent of the Centrelink Cashless Debit Card, the Bill requires that supports meet particular criteria before they can be purchased with ‘NDIS dollars’$^3$.

Further considerations

Deferring costs

Payments to participants will be deferred if the Bill increases the number of matters subject to internal review and appeal and/or results in delays in the transition of individuals from early intervention to lifetime participation. While there may be some savings where needs reduce during the interval or participants die, there is a concomitant risk that the Scheme’s overall costs will increase where a person’s level of disability is increased by delays in obtaining appropriate supports.

Increasing the number of participants who will leave the Scheme

This includes an unquantified number of early intervention participants as well as those participants who are reassessed as not meeting access requirements after their admission to the Scheme. The Alliance is concerned that there is no clarity as to how this will affect participants whose condition is subject to remission and relapse, such as those living with multiple sclerosis.

Increasing the number of participants whose plan funds are frozen

The unquantified number of participants who do not provide requested information or a reasonable excuse to the CEO within the defined time limits.

Providing for the discounting of funded NDIS supports

By reducing plan funding by amounts awarded to participants as lump sum compensation that are for purposes other than disability supports (such as compensation for pain and suffering or lost wages) (see s 32(4)(b)).

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longstanding disputes over ‘who pays’, with each side arguing that there is substantial cost- shifting across levels of government as a failure to adhere to the APTOS. Without agreement about the APTOS or Foundational Supports, such disputes between levels of government are likely to increase.

The NDIS Review discussed the ‘disability ecosystem’ at some length. For such a concept to become workable, Governments must finally resolve the perennial interface issues as a central pillar of the NDIS reform, including:

clearer agreement on the responsibilities of each service system
a method of obtaining enforceable agreement on the provision of supports in relation to individuals (or classes of individuals) or supports (of classes of supports), including Foundational Supports, and
a mechanism for resolving disputes between governments when there is a dispute over responsibility or delivery, either before or after agreement.

To avoid the risk that the proposed amendments pose to participants in the absence of systemic changes across other government programs, it is essential that the Commonwealth negotiates an agreement with the States and Territories before any changes come into force on:

guarantees for the provision of any ‘non-NDIS’ supports that are required to ensure the effectiveness and safety of NDIS supports, and
mainstream interface arrangements including protocols to cover concurrent service planning and delivery.

The Commonwealth Government should commit to the establishment of a branch within the NDIA to manage mainstream interface negotiations.

We would value the opportunity to meet with the Committee to discuss the points this supplementary submission makes.

Further contact

Dr Bronwyn Morkham