Psychosocial disability support outcomes threatened by Bill (Provider advocacy)

National Disability Insurance Scheme Amendment (Securing the NDIS for Future Generations) Bill 2026 Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

COMPASS HOUSE PTY LTD

NDIS-Registered Psychosocial Disability Support — Rockhampton, Central Queensland

Submission to the Senate Community Affairs Legislation Committee

Inquiry into the

National Disability Insurance Scheme Amendment (Securing

the NDIS for Future Generations) Bill 2026

Submitted by:

Susan McHugh  | CEO & Co-Founder, Compass House Pty Ltd

116–118 Elphinstone Street, Berserker QLD 4701

info@compasshouse.com.au 22 May 2026

Consent to publication: Compass House Pty Ltd consents to the publication of this submission, including the name and contact details of the author.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 1

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

Acknowledgement of Country

Compass House acknowledges Aboriginal and Torres Strait Islander people as the First Peoples and traditional custodians of the land now called Australia. We acknowledge the Darumbal people as the traditional custodians of the lands on which we work in Rockhampton, Central Queensland. We pay our respects to Elders past, present, and emerging.

We also acknowledge people with disability in all their diversity — particularly those who have experienced or continue to experience inadequate support, systemic barriers, and the consequences of policy decisions made without their meaningful input.

About Compass House Pty Ltd

Compass House Pty Ltd is an NDIS-registered psychosocial disability support provider based in Rockhampton, Central Queensland. Co-founded in 2020 by Susan and Allan McHugh, we provide intensive, relationship-based, trauma-informed community support to up to 25 participants living with complex psychosocial conditions.

Our flagship outcome: zero unplanned psychiatric hospital admissions for participants in daily support since 2020. Our model works and should be replicated in psychosocial disability supports. This is not coincidence. It is what intensive, relationship-based, trauma-informed community support produces when properly resourced.

We are a for-profit Pty Ltd, but reinvest the miniscule profit we may make back into the supports for our people — a structural choice that creates real disadvantages in insurance markets, grant access, and salary packaging that our not-for-profit peers do not face. Our advocacy addresses this directly.

Several provisions of this Bill directly threaten the outcomes we have spent five years building for our participants.

Executive Summary

Full citations for all numbered references (¹ ² ³ ⁴…) are provided in Appendix B.

Core Contention

Several provisions of this Bill will cause measurable, foreseeable harm to people with

psychosocial  disability — and  to  all  participants whose conditions are  episodic,

fluctuating, or environment-dependent. The Commonwealth has been told this during

consultation. This submission  identifies  five  specific provisions, the human  rights

obligations they breach, and the amendments required to remedy them. It also places these provisions in their reform context and states Compass House’s position on self directed support registration.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 2

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

The Five Key Issues

BILL PROVISION WHAT IT WILL DO

Functional capacity definition Tests ability WITHOUT assistance and EXCLUDING (s.9B, Sched. 1 Pt 1) environment. Cannot capture episodic conditions across the full disability spectrum. Plans cut based on best-day performance, not daily reality. Assessments conducted by persons with no required specialist knowledge of the condition being assessed. In mental health, where significant stigma is documented and persistent, an untrained assessor is not a neutral observer. They are a risk.

Permanence tightening (Sched. Overrides s.24(2) and s.24(3) — existing statutory 1 Pt 8) protections Parliament enacted specifically for episodic conditions. Adds a treatment exhaustion requirement. Treats support-maintained stability as evidence the disability has resolved — then removes the support. The stability does not survive its removal.

Plan suspension for Allows plans to be suspended when a participant does not uncontactable participants respond. The NDIA’s own contact practices — private (s.40A, Sched. 1 Pt 7) numbers, no callback pathway, no time to arrange support — are structurally inaccessible to the people this provision most affects.

Alternative support / excluded Gives the Minister unconstrained power — by Rules, impairments (Sched. 1 Pt 9) without consultation, without evidence, without verified alternatives — to declare another system adequate for a given impairment and remove participants from the NDIS. No operational alternative is required before the declaration is made. No equivalence of support intensity is required. A pen-stroke can end access for an entire cohort.

Pricing determination (Sched. 3 Transfers pricing power to the Minister alone — removing Pt 1) the published cost model, independent review, and sector consultation that currently govern how prices are set. A single ministerial instrument, with no independent verification, can set the price of every support in the Scheme. This is not a pricing reform. It is the removal of pricing accountability.

Summary of Recommendations

1. Amend s.9B or make Rules requiring functional capacity assessments to account for episodic variation over time, not snapshot performance in assistance-free conditions — applying across all disability types with episodic presentations.

2. Make NDIS Rules under s.25A(4) before Part 8 commences: episodic conditions satisfy permanence; support-maintained stability is not evidence of non-permanence; geographic barriers are relevant.

3. Amend s.40A to require that contact attempts before any plan suspension are made by accessible means — identified number, advance notice, named contact with callback pathway, adequate time to arrange support.

4. Amend s.40A to prohibit plan suspension without first contacting the participant’s registered provider and confirming the participant is not in receipt of active support.

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

5. Require Rules under s.25B(4) to be preceded by co-design and verified evidence that the alternative system has operational capacity in the participant’s geographic location.

6. Require the pricing determination framework to address the specialist complexity cost gap and the structural cost differential between for-profit and NFP registered providers.

7. Require that any framework for self-directed support registration recognises the self- directing participant as employer of record, with corresponding obligations, while explicitly permitting engagement of unregistered workers under participant oversight.

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

1. The Reform Trajectory — Why This Bill Cannot Be Read in

Isolation

This Bill arrives at the most consequential reform juncture in NDIS history. Its five provisions cannot be assessed as isolated technical amendments. They sit within a pattern of reform that has been assembling, piece by piece, since the Getting the NDIS Back on Track Act 2024. The cumulative effect of these reforms is a progressive narrowing of who the NDIS serves — and how.

Understanding that trajectory is not political commentary. It is necessary context for evaluating what each provision in this Bill actually does.

The Consultation Window — 18 Days for a 113-Page Bill

This Bill was introduced to Parliament on 14 May 2026. The Senate Committee originally closed submissions on 29 May 2026 — fifteen calendar days to respond to 113 pages of fundamental change affecting everything from who can access the Scheme to what they are funded for. Following significant community concern, the deadline was extended by a further three days to 1 June 2026. Eighteen days total. The government had months to draft this legislation. People with disability were granted a fortnight, and a last-minute extension of three days in response to sector pressure.

This is the same government that invoked ‘Nothing about us, without us’ at the National Press Club. An 18-day window — extended only under pressure — is not consistent with that commitment. It is the form of consultation with the content removed. The Committee should note this in any report, and should not interpret a small volume of community submissions as indicating a small level of concern.

The pattern of eligibility narrowing The 2024 Act introduced the concept of ‘reasonable and necessary’ supports tied more tightly to functional impairment. Approval rates for people with psychosocial disability have fallen 62% over five years, with only 25% of applications now succeeding. The NDIA is conducting its own internal review of this decline. The government is legislating further restrictions while that review is incomplete.

This Bill’s functional capacity test and permanence tightening do not operate in a vacuum. They accelerate a trajectory that is already measurably reducing access for people with episodic conditions. This affects not only people with psychosocial disability but all participants whose conditions fluctuate — acquired brain injury, multiple sclerosis, lupus, and many others.

The alternative support exclusion power — the legislative exit mechanism Schedule 1, Part 9 is the provision that must be understood in its full policy context. The power to declare another system the alternative for a given impairment is, in plain terms, the mechanism by which psychosocial disability can be progressively removed from the NDIS without any formal declaration of exclusion.

The nominated alternative is PHN-funded mental health services. PHN services deliver six to ten sessions of psychological support. Compass House delivers daily intensive relational support to people who would otherwise require psychiatric hospitalisation. These are not

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

equivalent systems. Declaring one the alternative to the other is not a policy position — it is a fiction.

MHCC has been direct: ‘There must be a clearly articulated and funded alternative service system, with the respective roles and responsibilities of state and territory governments agreed’ before any exit occurs.⁵ That system does not exist. NSW dismantled its community mental health infrastructure to fund the NDIS and cannot quickly rebuild it. The history that created the NDIS is about to be repeated.

Foundational Supports as the destination — that is not yet built Minister Butler’s address to the National Press Club on 22 April 2026⁴ announced the Inclusive Communities Fund ($200M) and a Foundational Supports framework. These are positioned as the ‘missing middle’ — support for people who do not qualify for the NDIS or who exit it. The framing is compassionate. The operational reality is that neither is functional at scale.

MHCC has stated explicitly that ‘psychosocial challenges cannot be addressed through programs such as the announced Inclusive Community Fund alone.’⁵ A $200M fund distributed across the full disability and community sector is not a substitute for individualised, intensive, daily psychosocial support. The exit is being legislated before the landing zone is built.

Pricing inadequacy as passive market contraction If registered specialist providers cannot survive financially, participants have no choice but to use unregistered, lower-intensity providers, or have their plans reduced to the point where any

specialist  provider  is  unviable. The market  contracts,  specialist psychosocial support

disappears from the landscape, and the exit occurs without any ministerial declaration ever being made. This is the path of least political resistance and the highest human cost.

The scope of this risk is not psychosocial alone The legal and policy mechanisms being established in this Bill apply across all disability types. The functional capacity test disadvantages anyone with an episodic presentation. The permanence tightening affects anyone whose condition is managed rather than cured. The alternative support exclusion power could be directed at any cohort. The plan suspension provision affects any participant who becomes unreachable during a health episode.

Psychosocial disability is the most acute current case — the canary. What happens to this cohort first tends to happen to all eventually, as the aged care parallel in this submission demonstrates. The Committee’s response to these provisions will set the standard for how the Scheme treats all participants whose conditions do not fit a static, worst-day, assistance-free presentation.

The Question Before This Committee

The question is not only whether each provision has a reasonable justification in isolation. The question is whether the cumulative effect of these provisions — read against the

reform  trajectory  in which they  sit —  is consistent with the NDIS’s foundational

commitment to the people it was created to serve.

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

Each Provision Is Framed as Something It Is Not

The Committee should read each provision against its policy framing:

• The functional capacity definition is framed as ‘objective and evidence-based.’ It is structured to produce systematically lower assessments for episodic, environment-dependent, and support-dependent conditions. Objectivity that produces discriminatory outcomes is not neutral methodology. It is discrimination wearing a methodology.

• The permanence tightening is framed as ‘clarifying’ the meaning of permanence. It overrides s.24(2) and s.24(3) of the current Act — provisions Parliament enacted specifically to protect episodic conditions. Removing statutory protections is not clarification.

• The plan suspension power is framed as an administrative efficiency measure. The NDIA’s own contact practices — private numbers, no callback pathway, inadequate notice — create the non-contact it then uses as grounds for suspension. The mechanism punishes participants for the agency’s own accessibility failure.

• The excluded impairments power is framed as ‘eligibility clarification.’ It is a ministerial power, exercisable by Rules without full parliamentary process, to remove entire diagnostic cohorts from the NDIS with no requirement to verify that an alternative exists, is funded, or is accessible.

• The pricing determination is framed as ‘decision-making governance.’ It transfers pricing from an independent, evidence-based, consultative framework to sole ministerial discretion, exercisable by legislative instrument. That is not governance improvement. It is accountability removal. The Bill is called ‘Securing the NDIS for Future Generations.’ Every provision in it narrows access, concentrates power, or removes accountability for the people who depend on it now. The Committee should evaluate the provisions against their actual effects, not their labels.

2. The Government Knew The evidentiary record of constructive knowledge is clear. The government did not act in ignorance of these risks.

• 62% drop in NDIS approval rates for people with psychosocial disability over five years, with only 25% of applications now succeeding (Australian

Psychosocial Alliance, Access Denied, 2026).¹

• The NDIA’s Psychosocial Disability Access Fact Sheet (National Mental Health Sector Reference Group, 2026) states: ‘it is clear there has been a decline in access rates for people with psychosocial disability which requires further consideration.’² The NDIA is conducting an internal practice review. The government is legislating further restrictions while that review is incomplete.

• $6 billion invested in NDIS psychosocial plans in the 12 months to December 2025 — yet outcomes for participants with psychosocial disability are going backwards

(Mental Health Australia & Australian Psychosocial Alliance, Submission on NDIS

New Framework Planning Rules, March 2026).³

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

• The Explanatory Memorandum acknowledges the risks: it states that Rules may need to be made to address the functional capacity test for psychosocial disability, and that ongoing treatment to maintain stability is not a bar to permanence. None of those Rules have been made. The Bill was tabled anyway.

• Peak bodies submitted formal evidence. MHCC, MHA, APA, and AAPi all identified these specific risks during consultation. The government read those submissions. Proceeding without amendment constitutes knowing disregard.

CRPD Optional Protocol — The Accountability Mechanism That Already Exists

Australia ratified both the CRPD (2008) and its Optional Protocol, giving individuals and groups the legal right to petition the UN CRPD Committee directly once domestic remedies are exhausted.

The CRPD Committee’s 2019 Concluding Observations on Australia¹² specifically raised concerns about inadequate psychosocial disability support under the NDIS. The

Australian Government was  formally  told, by the  treaty body   it  reports  to,  that

psychosocial disability support was inadequate. It is now legislating to restrict it further.

Compass House names this pathway explicitly and without apology. This is not a threat — it is the law. The Committee’s decisions on this Bill will form part of the domestic record against which any future individual petition is assessed.

3. The Five Issues 3.1 Functional Capacity Definition — s.9B

The Bill inserts s.9B, defining a person’s functional capacity as their ability to undertake an activity: (a) ‘without assistance from other people, assistive technology or modifications’; and (b) ‘in a context that excludes, as far as possible, the impact of the person’s environmental and personal circumstances.’ Note that assistive technology is explicitly excluded — someone who uses a wheelchair, communication device, hearing aid, or any adaptive equipment as part of their standard daily functioning has their capacity assessed as if that equipment does not exist. This is not a reasonable baseline for anyone whose disability is managed through

support,  technology,  or  environment.   It  is a  definition engineered  to produce  lower

assessments across the disability spectrum.

• The episodic problem. A participant assessed on a stable day will have a plan built on their best-day performance. Remove the support that created that stability and they deteriorate rapidly — but the plan reflects a person who ‘didn’t need it.’

• The assessment-without-support paradox. Testing functional capacity without assistance, then using that result to determine how much assistance to provide, is circular. The result measures what happens when support is removed, not what the person needs.

• Community access IS the functional support, not leisure. This is where people with psychosocial disability practise regulated nervous system function in real-world environments, with a co-regulating support worker present. Removing it produces: social isolation → nervous system shutdown → inability to self-care or seek help → crisis → hospital admission.

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

• Isolation kills. Social isolation is associated with a 26–29% increased risk of premature mortality — comparable to smoking 15 cigarettes a day (Holt-Lunstad et al., Perspectives on Psychological Science, 2015; PLOS Medicine, 2010).⁶ For people with pre-existing psychosocial conditions, isolation accelerates deterioration.

• The unqualified assessor problem. There is no requirement that the person conducting a functional capacity assessment for a participant with psychosocial disability has specialist knowledge of mental health conditions, trauma responses, or the presentations that characterise psychosocial disability. An assessor without this training is not a neutral observer. In a field where stigma about mental health is documented, persistent, and clinically significant, they are a source of active risk.

The Assessment Will Not See What It Cannot Recognise

MHA and the Australian Psychosocial Alliance have warned that relying on workers who lack psychosocial-specific skills ‘will also result in interactions between workers and participants that inadvertently contribute to the deterioration of the psychosocial disability itself.’³ (MHA/APA Submission on NDIS New Framework Planning Rules, March 2026, p.4)

A participant with psychosocial disability who presents as articulate, composed, and functional in a structured assessment environment may be doing so through dissociation, masking, or acute hypervigilance — states that read as competence to an untrained eye. That is not an assessment of functional capacity. It is an assessment of the participant’s ability to perform wellness under pressure. For someone managing a mental health condition in a context where stigma is real and consequential, that performance carries a cost the assessment never measures and the plan never funds.

Compass House Operational Evidence

Our zero unplanned hospital admission record exists because our participants do not function without assistance. They function with consistent, relationship-based support in community settings. Defining their capacity without that support, in conditions stripped of their environment, measures a fiction — and funds accordingly.

CRPD Article 5 (non-discrimination) and DDA s.6 (indirect discrimination) are engaged. People with episodic conditions are substantially less able to satisfy this test accurately than people with stable disability presentations. The assessor qualification gap compounds this: an

inaccurate assessment methodology conducted by an  under-qualified assessor  in a

stigmatised field is not a minor administrative risk. For people with complex psychosocial conditions, it is dangerous and potentially life-threatening.

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

RECOMMENDATION 1

Amend s.9B or make Rules  requiring  that  functional capacity assessments  for

participants with episodic or fluctuating conditions: – capture episodic variation over time, not snapshot performance; – recognise that support-maintained stability is not evidence of reduced need; – are conducted only by assessors with demonstrated specialist training in the relevant disability type — for psychosocial disability, this must include formal competency in mental health conditions, trauma-informed practice, and the clinical presentations associated with the participant’s diagnosis; and – include a requirement that assessors identify and account for masking, dissociation, and performance of wellness as known features of psychosocial disability assessment contexts.

3.2 Permanence Tightening — Schedule 1, Part 8

• The statutory override — in the Bill’s own words. The Bill inserts s.24(6): ‘Subsections (2) and (3) have effect subject to subsection (5).’ This is not interpretation. It is the statute itself explicitly overriding the existing protections Parliament enacted for episodic conditions. s.24(2) (varying intensity may be permanent) and s.24(3) (episodic/fluctuating may be taken to be permanent) are both expressly subordinated to the new treatment exhaustion requirement. The Bill removes statutory rights through a single sentence.

• Geographic barriers are explicitly excluded as a reason for exemption — this is stated in the Bill. Section 25A(2) provides that treatment may be ‘appropriate treatment’ regardless of whether ‘the person’s individual circumstances restrict the person from accessing the treatment.’ A Note confirms that individual circumstances include ‘financial circumstances and geographical location.’ The only exemption in s.25A(3) is for medical reasons, not geographical inaccessibility. For Compass House participants in Rockhampton: if evidence-based treatment exists in Brisbane or Sydney but is unavailable locally — an 18-month waitlist, no local specialist — it still counts as ‘appropriate treatment’ that must be exhausted. The submission’s current Recommendation 2 asks that geographic barriers be recognised as relevant. The Bill explicitly says they are not.

• The treatment exhaustion requirement. The Bill’s new s.24(5) provides that impairments are not permanent unless: (a) the person has undertaken all appropriate treatment; (b) any other treatment is unlikely to materially improve, reverse, or alleviate the impairment; and (c) the impairments are likely to persist for the person’s lifetime. All three conditions must be met before an impairment can be considered permanent.

• The stability paradox. A participant who has achieved functional stability through ongoing disability support may now fail the permanence test — because the support worked. The evidence of effectiveness becomes the grounds for removing the support that produced it. The stability does not survive its removal.

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

• The Notes are not Rules. Note 2 to s.24(5) acknowledges: ‘a person may require ongoing treatment for some permanent impairments in order to maintain functional capacity in relation to an activity, even if the person has undertaken all appropriate treatments.’ This is the government’s own acknowledgement that the test is inadequate for psychosocial disability. But a Note does not bind delegates. Rules do. None have been made.

• CRPD Articles 25–26. The right to habilitation includes the right to retain access to effective services. A permanence test that treats the outcome of effective support as evidence against ongoing need is structurally incompatible with Australia’s obligations.

RECOMMENDATION 2

Amend s.25A(2)  to provide  that geographic  inaccessibility and system capacity

constraints are recognised as reasons a person  is taken to have undertaken  all

appropriate treatment. The Bill as drafted explicitly excludes geographical location from the exemption, applying a standard that treats inaccessible services as though they were accessible. Make binding Rules before Part 8 commences, establishing that: – episodic conditions requiring ongoing support satisfy the permanence test; – support-maintained stability is not evidence of non-permanence; and – geographic and system-capacity barriers to treatment are relevant, notwithstanding s.25A(2).

3.3 Plan Suspension for Uncontactable Participants — s.40A

This provision operates on a flawed premise and is compounded by a systemic failure in the NDIA’s own contact practices. Both must be addressed.

The premise is wrong: being unreachable is a symptom, not a failure

• Social withdrawal, non-responsiveness, and service disengagement are recognised features of psychosocial deterioration — and of many other disability presentations. The person most likely to be ‘not contactable’ is the person most likely to be in crisis.

• CRPD Article 19 violation. General Comment No. 5 explicitly states states must not withdraw community support services. Plan suspension does exactly this. ICCPR Article 6 (positive obligation to protect life) is also directly engaged — withdrawal of psychosocial support during acute crisis is a foreseeable precipitant of suicidality.

• What good practice looks like. Compass House has never suspended support when a participant goes quiet. We escalate: welfare checks, family contact, GP notification, treating clinician coordination. The Bill inverts this. It makes administrative non contact grounds for removing the support that could prevent a tragedy.

The NDIA’s own contact practices create the inaccessibility they then penalise The plan suspension provision assumes that non-contact reflects participant disengagement. In practice, the NDIA’s own contact systems are structurally inaccessible to the people this

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Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

provision most affects. This is not an assumption — it is the regular operational reality Compass House staff navigate on behalf of participants.

The Bill does not define ‘reasonable attempts to contact.’ There is no requirement in s.40A for contact to be made from an identifiable number, with advance notice, through a named contact, or at an agreed time. The NDIA defines its own standard of reasonableness. And the transitional provision (item 100 of Schedule 1) goes further: the CEO ‘may have regard to reasonable attempts made to contact the participant before, on or after the day this item commences.’ Contact attempts made right now — using the current practice of private numbers, first-name-only messages, and no callback pathway — can be retrospectively counted the moment the provision commences. The NDIA’s existing inaccessible contact practices are pre-loaded as potentially ‘reasonable.’

• The NDIA contacts participants from private, unidentified numbers. The participant cannot verify who is calling, cannot identify the caller, and cannot reach that person by return call.

• Calls are made at unpredictable times, without adequate advance notice for the participant to arrange a support person. Where a warning text is sent, the timeframe is insufficient for a participant with complex psychosocial needs to prepare for a high stakes administrative conversation about their plan.

• Callers identify themselves by first name only, with no direct callback number or staff identifier. A participant who misses the call — or cannot engage with it — has no reliable pathway to reach that person.

• For people with psychosocial disability, an unidentified private number call about their NDIS plan does not present as a routine administrative interaction. It activates hypervigilance, shutdown, and avoidance — the exact nervous system states that are features of their disability. Phone anxiety and avoidance of unknown callers are not character failures. They are disability presentations.

• Trauma surrounds participants’ engagement with the NDIA. Fear of plan reduction, past negative experiences with reviews, and the power imbalance inherent in a call about funding that enables daily living are not background noise. They are clinical realities that a contact system must account for.

• Compass House staff are frequently the first to know that an NDIA contact was attempted — because participants come to us frightened and unable to identify who called. We then spend significant uncompensated time navigating NDIA systems to locate the correct contact. This is the regular exception, not the edge case.

The Circular Failure

The NDIA creates a contact system that is structurally inaccessible to people with psychosocial disability, then uses non-response to that inaccessible system as evidence of disengagement warranting plan suspension. The participant bears the consequence of the NDIA’s own accessibility failure. This is not a minor administrative issue. It is a systemic failure at the point where the consequences are highest.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 12

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

RECOMMENDATION 3 — ACCESSIBLE CONTACT STANDARDS

Amend s.40A to require that before any plan suspension proceeds, the NDIA must demonstrate that contact was attempted by means accessible to the participant, specifically: – from a publicly identifiable number, or a number provided to the participant in writing in advance; – with written notice of sufficient time for the participant to arrange a support person before the contact occurs; – identifying the caller by full name and role, with a direct callback number provided in the notice; – at a time agreed with the participant, their nominee, or their registered provider; and – with acknowledgement that non-response to an unidentified private number call does not constitute evidence that the participant is uncontactable.

RECOMMENDATION 4 — PROVIDER CONFIRMATION REQUIREMENT

Amend s.40A to further require that: – plan suspension must not proceed for a participant with a registered provider without first contacting that provider and confirming the participant is not engaged with active support; and – suspension is prohibited where a provider confirms the participant is being actively supported.

3.4 Alternative Support / Excluded Impairments — Schedule 1, Part 9

• A ministerial declaration power with a purely subjective trigger. Under s.25B(4)-(6), an impairment becomes an ‘excluded impairment’ when NDIS Rules declare a support to be an alternative. Rules can declare a support as alternative by reference to a ‘system of service delivery’ — meaning the PHN system as a whole can be declared the alternative for psychosocial disability, not just specific services. The only condition before making those Rules is that the Minister is ‘satisfied that it is not appropriate to fund or provide a support for the impairment through the National Disability Insurance Scheme.’ That is purely subjective ministerial satisfaction. No objective standard. No independent review. No co-design requirement. One minister’s private satisfaction is the entire gateway.

• The alternative does not exist. 92,010 people in Queensland alone already have unmet psychosocial support needs outside the NDIS (Queensland Alliance for Mental

Health, 2024).⁷ The Inclusive Community Fund and proposed Foundational Supports

are not operational alternatives for people with complex conditions. The exit is being legislated before the landing zone is built.

• CRPD Article 28. The right to social protection cannot be satisfied by declaring a theoretically available system with no practical capacity for the person in their

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 13

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

location. Compass House’s participants in Central Queensland have nowhere else to go.

What makes this power uniquely dangerous is not merely its breadth but what it does not require. There is no obligation to consult with people with disability or their representative organisations. There is no requirement to verify that the nominated alternative has operational capacity in the participant’s geographic location. There is no transition period mandated. No equivalence of support intensity, frequency, or quality is required. The declaration can be made — and participants can lose NDIS access — before any of those conditions are met. This is not a gap in the drafting. It is the design.

MHCC has stated clearly: ‘There must be a clearly articulated and funded alternative service system, with the respective roles and responsibilities of state and territory governments agreed’ before any exit occurs.⁵ None of that is in this Bill. None of it is required before the Minister acts.

RECOMMENDATION 5

Require that Rules under s.25B(4) must: – be preceded by co-design with the sector before commencement; – be supported by independently verified evidence that the alternative system has operational capacity in the participant’s geographic location; and – not take effect until that capacity is confirmed.

3.5 Pricing Determination — Schedule 3, Part 1

This provision does not merely set prices. It removes the accountability architecture that currently governs how prices are set. That distinction matters enormously. And reading the Bill’s actual text, the accountability gap is worse than the framing suggests.

Section 45C gives the Minister power by legislative instrument to determine maximum amounts for NDIS supports. The NDIA is required to provide pricing advice — but the Minister is only required to ‘have regard to’ that advice, not follow it. The NDIA’s advice must consider cost, competition, and financial sustainability of the Scheme — but is not required to consider actual workforce costs, the SCHADS award, or the structural cost differential between for profit and NFP providers. There is no independent body. No sector consultation is required before a determination is made.

The Note to s.45C(1) explicitly exempts pricing determinations from the sunsetting provisions of the Legislation Act 2003. A pricing determination can sit in place indefinitely — with no automatic review, no expiry, and no obligation to revisit it as workforce costs or market conditions change. The SCHADS award increases. Prices stay. Providers exit.

There is also a structural conflict of interest embedded in this architecture. The body providing the pricing advice (the NDIA) is simultaneously responsible for the financial sustainability of the Scheme. The NDIA has a direct institutional incentive to recommend prices that are fiscally favourable to the Scheme, not prices that reflect the genuine cost of quality service delivery. Pricing advice from the entity with a financial interest in lower prices, given to a minister who

only needs to ‘have regard  to’  it, with no independent check,  is not an accountability

framework. It is the appearance of one.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 14

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

The problem is not just who holds the power — it is that no independent check remains

The NDIS was built on the principle that individualised support should be funded at the

level   it  actually costs  to  deliver. A pricing determination power  that requires no

independent verification, no published cost methodology, and no annual review against real workforce costs does not reform pricing. It removes the mechanism by which pricing can be held accountable to that principle.

• A ceiling without a floor. The determination sets a maximum. It does not require that maximum to be adequate. Without an obligation to cover actual delivery costs, the determination power institutionalises existing inadequacy and removes the tools to challenge it.

• Structural inequity for for-profit providers. Compass House cannot access NFP-only insurance markets, salary packaging, or the majority of grant streams. A pricing determination that ignores this structural cost differential between otherwise identical registered providers is not neutral: it advantages NFP providers and disadvantages the participants who rely on for-profit specialists.

• Economic reality. Community-based psychosocial programs generate cost offsets of $108,470 per person over five years (HASI/CLS, Purcal et al., UNSW, 2022)⁸ and $171,186 per person (HASI Plus, Purcal et al., UNSW, 2022)⁹ through reduced hospitalisation, justice contact, and health service use. A pricing model that drives specialist providers out of the market destroys those savings and transfers the cost to emergency departments.

RECOMMENDATION 6

Require that the pricing determination framework: – retains and requires a published cost model as the basis for all pricing determinations, with the methodology publicly accessible and independently reviewed; – mandates the involvement of IHACPA or an equivalent independent pricing body in setting and reviewing NDIS support prices; – requires genuine sector consultation — with providers, participants, and peak bodies — as a precondition for any pricing determination, not a discretionary step; – subjects all determinations to mandatory annual review against actual workforce costs, including SCHADS award movements; – includes a statutory obligation to differentiate pricing for complex psychosocial support needs; and – accounts for the structural cost differential between for-profit and NFP registered providers delivering equivalent supports.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 15

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

4. Self-Directed Participants as Employers — A Position on

Registration

While this Bill does not directly address provider registration, the framework governing NDIS oversight will shape how participants access supports under the legislative environment this Bill creates. Compass House takes this opportunity to state a position that is distinct from others in the sector.

Self-directing participants are employers. They should be recognised as such.

A participant who manages their own NDIS funding, engages their own workers, and directs their own support arrangements is operating an employment relationship. They are not simply a consumer selecting from a market — they are an employer, with workers depending on them, in a relationship that carries real legal and ethical weight.

The current framework creates a gap: a self-directing participant who operates without registration may be employing workers with no superannuation accruing, no workers compensation coverage if someone is injured, and no pathway to the Commission if something goes wrong. This does not serve the participant. It does not serve the worker. And it does not serve the integrity of the Scheme.

Compass House’s position is that self-directing participants should be registered under a distinct, light-touch category that carries the obligations that come with employment:

• Superannuation — contributions for workers employed under a self-directed arrangement

• Workers compensation — coverage for workers performing support tasks

• Insurance — where the nature of the support role requires it This is not a compliance impost. It is the legal recognition of what self-direction already is.

The registration sits with the participant-employer, not the individual worker.

Compass House supports the Taskforce’s recommendation for a distinct self-directed support registration category. We go further: that category should explicitly recognise the participant

as employer  of record. From  that recognition flows an important  right —  to engage

unregistered workers. The oversight obligation rests with the registered participant-employer, not with the individual worker they choose to employ.

The Distinction That Matters

An unregistered provider delivering supports without oversight is a risk to the participant. A registered self-directing participant who employs informal workers is exercising accountable control over their own support arrangements — with the Commission able to see that arrangement. Conflating the two fails in both directions.

Practical accessibility must be built in.

For participants with complex psychosocial conditions, the registration process must be simple and funded coordination assistance must be available. Many participants who have full capacity to self-direct in terms of their autonomy do not have the administrative capacity to manage employer obligations without support. A light-touch registration category with funded coordination assistance is what makes choice and control sustainable and safe.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 16

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

RECOMMENDATION 7 — SELF-DIRECTED SUPPORT REGISTRATION

That any legislative or regulatory framework for self-directed support registration: – recognises the self-directing participant as employer of record, with corresponding superannuation, workers compensation, and where relevant insurance obligations; – explicitly permits registered self-directing participants to engage unregistered workers, with oversight responsibility resting with the participant-employer, not the individual worker; – includes funded coordination assistance for participants whose disability affects capacity to manage employer obligations independently; and – is co-designed with people with disability and their representative organisations, including people with psychosocial disability, before commencement.

5. The Aged Care Warning: We Have Seen This Before The functional capacity assessment model in this Bill is structurally identical to the assessment approach that has failed in aged care. This is not a theoretical comparison. The Inspector General of Aged Care — the government’s own oversight body — has said it directly.

AGED CARE — What Happened NDIS BILL 2026 — What Is Being Introduced

Snapshot functional assessment Point- s.9B functional capacity definition Identical design. in-time test without assistance. Good- Ability without assistance, excluding environmental day / bad-day problem caused chronic context. Episodic conditions across the disability underestimation of fluctuating need. spectrum cannot be accurately captured.

Relational and preventative supports Community access funding at risk Same logic: if stripped out Social connection, the functional capacity test doesn’t capture why relationship continuity, early-warning community access is structured functional support, support scored poorly on assessment delegates will cut it. tools. Systematically cut.

Stability treated as non-need People Permanence tightening does the same who were well-supported appeared low- Participants stable because of support may fail the need on assessment. Support was permanence test. Effective support becomes the reduced. They deteriorated. grounds for removing it.

‘Wait until crisis’ dynamic Inspector- Plan suspension + access tightening Support General: wait until you are unwell removed when person is most unreachable. enough, frail enough, desperate enough Access tightened as the person deteriorates — then we’ll respond. toward threshold.

No alternative ready Support at Home No alternative ready Foundational Supports not launched before adequate alternatives operational. 92,010 Queenslanders with unmet for those falling below threshold. need. This Bill widens the gap.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 17

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

Inspector-General of Aged Care — Natalie Siegel-Brown, 25 March 2026¹⁰

“Our funding system overwhelmingly privileges clinical interventions, task-based care,

and  late-stage dependency while systematically under-funding:  social connection;

navigation and care partnership; emotional, spiritual and relational care; and early intervention that slows decline.”

“The uncomfortable truth is, we are trying to deliver relational, humane, preventative care through a system designed for transactions, compliance and late-stage intervention.”

“The law alone cannot do this work. Without mechanisms, incentives and funding structures that reward prevention and independence, the Act risks becoming poetry without plumbing.”

Susan McHugh has direct experience of aged care assessment failures: her parents both live with advanced dementia in Yeppoon and she has submitted evidence to the IHACPA Support

at Home Pricing  consultation. She has watched  functional assessment systematically

underestimate their needs. She is now watching the government import the same model for her participants.

6. What the Committee Is Being Asked to Authorise This Committee is being asked to authorise legislation that:

• Creates a functional capacity assessment that structurally disadvantages all participants with episodic or fluctuating conditions — after being told it does so

• Treats the outcome of effective disability support as potential evidence against ongoing need

• Allows plan suspension during acute crisis — directly contrary to CRPD General Comment No. 5¹¹ — compounded by NDIA contact practices that are structurally inaccessible to the people most affected

• Creates an unlimited ministerial power to exclude participants from the NDIS without a funded, operational alternative in place

• Replicates an assessment model that is already failing elderly Australians in aged care, as the government’s own Inspector-General has documented

• Does all of this as part of a cumulative reform trajectory that is progressively narrowing who the NDIS serves — with no funded alternative ready to catch those who fall out

Each of these outcomes was foreseeable. Each was identified in formal submissions. Each is supported by the government’s own data. Each engages binding international obligations.

The seven recommendations in this submission are targeted and practical. They do not undermine the policy intent of the Bill. They make that intent workable for the people most likely to fall through the gap.

Compass House is available to provide oral evidence. Susan McHugh can speak to five years of operational outcomes, the specific participant safety risks created by each provision, and

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 18

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

the direct parallel between the aged care assessment failures and what this Bill proposes for the NDIS.

Susan McHugh  | CEO & Co-Founder, Compass House Pty Ltd

116–118 Elphinstone Street, Berserker QLD 4701  | info@compasshouse.com.au

22 May 2026

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 19

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

Appendix A — Rights and Legal Obligations Engaged

INSTRUMENT / OBLIGATION ENGAGED

PROVISION

CRPD Articles 5, 12, 19, Non-discrimination; equal recognition before the law; right to live 25, 26, 28 independently in the community (CRPD General Comment No. 5 — states must not withdraw community support services); right to health and habilitation; adequate standard of living and social

protection. The CRPD Committee’s 2019 Concluding

Observations on Australia raised concerns about inadequate psychosocial disability support. Legislating further restrictions after those observations creates direct exposure.

CRPD Optional Protocol Australia ratified the Optional Protocol in 2008. Individuals and groups have the right to petition the CRPD Committee directly once domestic remedies are exhausted. The decisions this Committee makes will form part of the domestic record against which any future petition is assessed.

ICCPR Article 6 Positive obligation to protect life from foreseeable risks created by state decisions. Plan suspension during acute psychosocial crisis is a foreseeable precipitant of suicidality. The government has been told this. The NDIA’s inaccessible contact practices compound the risk.

DDA 1992 s.6 Indirect discrimination. The functional capacity definition imposes a condition people with episodic disability cannot satisfy accurately. The s.47 statutory authority exemption is arguably unavailable — the discrimination was avoidable and the government was told how to avoid it.

Human Rights The Statement of Compatibility must be interrogated. Compass (Parliamentary Scrutiny) House requests the Committee verify whether it adequately Act 2011 addresses CRPD Article 19 (plan suspension), Article 5 (functional capacity definition), ICCPR Article 6 (foreseeable risk to life), and the accessibility failures in NDIA contact practices.

NDIS Amendment (Securing the NDIS) Bill 2026 — Compass House Pty Ltd Page 20

Submission 279

Compass House Pty Ltd              NDIS-Registered Psychosocial Support Provider  | Rockhampton, QLD

Appendix B — References

All references are numbered in the order they first appear in this submission. Superscript numbers in the text correspond to the entries below.

¹ Australian Psychosocial Alliance (2026). Access Denied: Experiences of people with psychosocial disability accessing the NDIS. APA.

² National Disability Insurance Agency (2026). Psychosocial Disability Access — National

Mental Health Sector Reference Group Fact Sheet. NDIA. Official document cleared for

network distribution.

³ Mental Health Australia & Australian Psychosocial Alliance (2026, March 10). Submission

to the Public Consultation on NDIS New Framework Planning Rules. MHA/APA. pp. 2, 4. ⁴ Butler, M. (2026, April 22). Speech at the National Press Club [Speech]. Canberra: Australian Government. Available at: https://www.health.gov.au/ministers/the-hon-mark butler-mp/media/minister-butler-speech-at-the-national-press-club-22-april-2026 ⁵ Tadros, E. (2026, April 22). No Exit Without a Safety Net: Psychosocial Supports and the NDIS [Media Release]. Mental Health Coordinating Council (MHCC). ⁶ Holt-Lunstad, J., Smith, T.B., Baker, M., Harris, T., & Stephenson, D. (2015). Loneliness and social isolation as risk factors for mortality: A meta-analytic review. Perspectives on Psychological Science, 10(2), 227–237. https://doi.org/10.1177/1745691614568352 Holt-Lunstad, J., Smith, T.B., & Layton, J.B. (2010). Social relationships and mortality risk: A meta-analytic review. PLOS Medicine, 7(7), e1000316. https://doi.org/10.1371/journal.pmed.1000316 ⁷ Queensland Alliance for Mental Health (2024). Summary of the analysis of unmet need for psychosocial supports outside the NDIS — Final Report for Queensland. QAMH. ⁸ Purcal, C., O’Shea, P., Giuntoli, G., Zmudzki, F., & Fisher, K.R. (2022). Evaluation of NSW

Community-based Mental Health Programs: Community Living Supports and Housing and

Accommodation Support Initiative. CLS-HASI Evaluation Report. UNSW Social Policy

Research Centre. Available at: https://www.health.nsw.gov.au/mentalhealth/resources/Publications/cls-hasi-eval-rpt.pdf ⁹ Purcal, C., Giuntoli, G., O’Shea, P., Zmudzki, F., Fisher, K.R., & Campbell, E. (2022).

Evaluation of Housing and Accommodation Support Initiative Plus (HASI Plus). HASI Plus

Evaluation Report. UNSW Social Policy Research Centre. Available at: https://doi.org/10.26190/unsworks/28496 ¹⁰ Siegel-Brown, N. (2026, March 25). Upstream or Overwhelmed: Rewiring the Aged Care

Budget — Not Beds — for Real Reform [Speech]. DCM Leaders Summit, Sydney. Published

by the Office of the Inspector-General of Aged Care, 8 April 2026. ¹¹ United Nations Committee on the Rights of Persons with Disabilities (2017). General Comment No. 5 on article 19: Living independently and being included in the community. CRPD/C/GC/5. Geneva: UN. ¹² United Nations Committee on the Rights of Persons with Disabilities (2019). Concluding observations on the combined second and third periodic reports of Australia. CRPD/C/AUS/CO/2-3. Geneva: UN.

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