NDIA Accountability Project

Submission 3 — Australian National Audit Office — NDIS participant experience in rural, regional and remote Australia

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23 January 2024

Ms Libby Coker MP

Chair

Joint Standing Committee on the National Disability Insurance Scheme

By email: ndis.joint@aph.gov.au

Dear Ms Coker

ANAO Submission for the Inquiry into the NDIS participant experience in rural, regional and remote Australia

The Australian National Audit Office (ANAO) presented the following performance audits to the Parliament that you may find relevant to the above inquiry:

  • Auditor-General Report No.43 (2022-23) Effectiveness of the National Disability Insurance Agency’s Management of Assistance with Daily Life Supports; and

  • Auditor-General Report No.14 (2020-21) Decision-making Controls for NDIS Participant Plans Information about what the audits assessed, concluded and recommended is attached. The audit reports are available online at www.anao.gov.au. Should the Committee require further information in relation to these matters, my office would be pleased to provide you with a briefing at a time convenient to you or appear as a witness at a hearing. To arrange a briefing, please contact our External Relations team at external.relations@anao.gov.au.

Yours sincerely

Grant Hehir

GPO Box 707, Canberra ACT 2601

38 Sydney Avenue, Forrest ACT 2603

Phone: +61 2 6203 7300

Auditor-General Report No.14 2020–21 Decision-making Controls for NDIS

Participant Plans

Background

  1. The NaƟonal Disability Insurance Scheme (NDIS or the Scheme) replaced exisƟng Commonwealth, state and territory disability support systems with a naƟonally consistent scheme aimed at providing Australians under the age of 65, who have a permanent and significant disability, with the reasonable and necessary supports they need to live an ordinary life. The NDIS is a naƟonally based scheme with funding and governance shared amongst all governments. The NaƟonal Disability Insurance Agency (NDIA or the Agency) holds and manages Scheme funds, administers access to the Scheme and approves payments of support packages based on individual parƟcipants’ needs.

  2. The NDIS provides funding to eligible parƟcipants so they can access disability supports and services. The Scheme commenced in July 2013 with a three year trial phase before being progressively rolled out to each state and territory over a four year transiƟon phase from 1 July 2016. 2020–21 is the Scheme’s first year of full operaƟon, with the NDIA transiƟoning to full scheme on 1 July 2020. When fully implemented, the Scheme is expected to benefit around 500,000 Australians.

  3. The NDIS care model seeks to invest in appropriate supports over the life of each parƟcipant. Eligible parƟcipants will develop a plan with the NDIA, which idenƟfies their individual goals and aspiraƟons and the ‘reasonable and necessary’ supports1 required to help them achieve these. Plans generally cover a minimum 12 month period. Plans are reviewed with a parƟcipant prior to expiry and a new plan is developed. ParƟcipants with an approved plan may purchase supports from service providers of their choice.2

  4. ParƟcipants receive funding for supports — assistance or products that help a person in their daily life and help them to parƟcipate in the community and reach their goals — from the NDIA through the provision of a parƟcipant plan. The requirements for plans are outlined in secƟon 33 of the National Disability Insurance Scheme Act 2013 (NDIS Act). A key component of a plan, the statement of parƟcipant supports, which is prepared with the parƟcipant and approved by the NDIA Chief ExecuƟve Officer (CEO) specifies, among other things, any reasonable and necessary supports that will be funded under the NDIS. In making a decision over the funding for reasonable and necessary supports, the CEO must be saƟsfied of six criteria outlined in subsecƟon 34(1) of the NDIS Act. RaƟonale for undertaking the audit

  5. The NDIS represents a significant financial commitment by all Australian governments. The NDIS is expected to grow over the next three years to provide support to approximately 500,000 Australians with permanent and significant disability. In 2019–20, $16.1 billion of supports was funded through parƟcipant plans.

  6. Decisions on the reasonable and necessary supports to be provided to parƟcipants under the Scheme are criƟcal to both parƟcipant outcomes and Scheme financial sustainability. Financial sustainability is a key objecƟve of the NDIS, and the scope and volume of supports funded through

1 The criteria for determining if a support is ‘reasonable and necessary’ are set out in secƟon 34 of the National Disability Insurance Scheme Act 2013. 2 Individuals or organisaƟons delivering a support or product to a parƟcipant of the NDIS must generally be registered with the NDIS, except for self-managed parƟcipants, who may access supports from non-registered providers. OFFICIAL

parƟcipants’ plans is a major cost driver. To manage this cost driver, the supports included in parƟcipant plans must be ‘reasonable and necessary’ as defined in the NDIS Act. Decisions about what are reasonable and necessary supports require the exercise of judgement on behalf of delegated decision makers. Failure to implement effecƟve decision-making controls could result in:

  • inconsistency in the applicaƟon of the law;
  • significantly increased Scheme costs;
  • inadequate provision of support to Scheme parƟcipants; and/or
  • cost-shiŌing between government programs or to parƟcipants.

  1. The NDIA’s control framework has been subject to two previous ANAO performance audits. Of parƟcular relevance is the ANAO’s 2017–18 audit that examined the decision-making controls for NDIS access.3 This audit builds on the work undertaken in the earlier audit to provide assurance of the financial sustainability control framework for the NDIS, by examining decision-making controls for parƟcipant plans. Audit objecƟve and criteria

  2. The audit objecƟve was to assess whether the NDIA has appropriate controls to ensure supports in parƟcipant plans are ‘reasonable and necessary’.

  3. To form a conclusion against the audit objecƟve, the ANAO adopted the following high level audit criteria:

  • Has the NDIA established and implemented appropriate policies and processes to ensure supports in parƟcipant plans are ‘reasonable and necessary’?

  • Is there appropriate oversight to ensure supports in parƟcipant plans are ‘reasonable and necessary’?

Conclusion

  1. The NDIA does not yet have appropriate controls to ensure supports in parƟcipant plans are ‘reasonable and necessary’. While an appropriate control framework had been established, the effecƟve implementaƟon of the controls will provide the NDIA with greater assurance that the supports approved in parƟcipant plans are reasonable and necessary. EffecƟve implementaƟon of controls will further assist the NDIA to manage risks relaƟng to Scheme sustainability, while ensuring parƟcipants are receiving adequate supports.

  2. While the NDIA had established largely appropriate policies and processes for parƟcipant planning, the implementaƟon of the policies and processes did not provide the NDIA with appropriate assurance that supports in parƟcipant plans are reasonable and necessary.

  3. The NDIA does not yet have appropriate oversight mechanisms in place to ensure the supports in parƟcipant plans are reasonable and necessary. The NDIA has established some frameworks for

3Auditor-General Report No.13 of 2017–18 Decision-making Controls for Sustainability — National Disability Insurance Scheme Access.

oversight and control of decision-making for parƟcipant plans; however, to date, this is not systematically leading to enterprise wide actions for improvement and compliance in decision-making.

SupporƟng Findings

  1. The NDIA has established largely appropriate policies and processes for parƟcipant planning. The NDIA’s internal guidance and training materials are consistent with the legislaƟon, although oversight of training compleƟon could be improved. AddiƟonal support mechanisms are in place to assist delegates in reasonable and necessary decision-making. The NDIA instrument of delegaƟon had not been updated to reflect organisaƟonal changes made to plan delegaƟon level four arrangements over a two year period.

  2. ImplementaƟon of parƟcipant planning has not complied with established policies and processes. The NDIA’s quality assurance audits have shown low levels of compliance with internal policy. The NDIA’s Customer RelaƟonship Management system does not fully support recording of parƟcipant planning consideraƟons and approvals, or require all mandatory planning requirements to be completed.

  3. The NDIA had implemented a largely appropriate quality assurance process for parƟcipant plans. There was not enough evidence that quality assurance acƟviƟes lead to acƟon taken to resolve the issues idenƟfied and systemic improvement. As the NDIA had recently commenced conƟnuous improvement processes, it was not evident what impact these processes have had to date.

  4. While the NDIA had some mechanisms for review processes to inform conƟnuous improvement in decision-making for reasonable and necessary supports, these are not considered at an enterprise level and their impact is unclear.

  5. Since June 2019, the NDIA has been measuring performance of planners in relaƟon to reasonable and necessary decision-making through an internal Key Performance Indicator (KPI) and a separate quality metric. The underlying input to both performance measures is the same, yet the measures have different targets. The NDIA does not report externally specifically in relaƟon to reasonable and necessary supports in parƟcipant plans; however, informaƟon more broadly around reasonable and necessary supports is included in external reports.

RecommendaƟons

Recommendation No. 1

The NaƟonal Disability Insurance Agency review and update the ICT system controls relaƟng to recording parƟcipant planning consideraƟons and approvals, to align the system processes with internal policy requirements and to beter support planning processes for reasonable and necessary decision-making.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 2

The NaƟonal Disability Insurance Agency establishes mechanisms to track and analyse (at the enterprise level) issues arising from review mechanisms to inform conƟnuous improvement in reasonable and necessary decision-making, including:

a) using outcomes data from internal reviews and AAT reviews, including early resoluƟon outcomes, to inform conƟnuous improvement in reasonable and necessary decision-making; and

b) implemenƟng metrics for measuring the success of conƟnuous improvement iniƟaƟves to enable the Agency to determine whether the iniƟaƟves are having the intended impact.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 3

The NaƟonal Disability Insurance Agency align Service Delivery KPI and quality metric targets for reasonable and necessary decision-making; and review the target on a regular basis with a view to increasing the target to drive greater quality standards in reasonable and necessary decision- making.

NaƟonal Disability Insurance Agency: Agreed and Complete

Auditor-General Report No.43 2022–23 Effectiveness of the National Disability

Insurance Agency’s Management of Assistance with Daily Life Supports

Background

  1. The NaƟonal Disability Insurance Scheme (NDIS or the Scheme) was established in 2013 under the National Disability Insurance Scheme Act 2013 (NDIS Act) to provide funding for reasonable and necessary supports for eligible people with disability. The NDIS is jointly funded by the Australian, state and territory governments under bilateral agreements. In 2021–22, NDIA made $28.6 billion in payments to 534,655 parƟcipants for NDIS supports. FiŌy-five per cent of all parƟcipants (295,281) aged seven years and over received funding for assistance with daily life (ADL) supports, averaging $96,996 per year. The NDIS is expected to grow to 1,017,522 parƟcipants and $89.4 billion for the year ending 30 June 2032.

  2. The NaƟonal Disability Insurance Agency (NDIA) is the Australian Government enƟty responsible for delivering the NDIS. The NDIA contracts Partners in the Community (PITC) organisaƟons, including Local Area Coordinators (LACs) and Early Childhood (EC) Partners to assist parƟcipants with applying to join the NDIS and then developing and implemenƟng their plan of funded NDIS supports.

  3. Funding for each NDIA parƟcipant is determined through the development of a parƟcipant plan, which sets out the parƟcipant’s goals and aspiraƟons, the reasonable and necessary supports that they require and will be funded, and how that funding will be managed. Plans can be developed by NDIA staff or LACs and are then approved by a NDIA delegate. NDIA assists parƟcipants to implement their plan by publishing informaƟon and guidance materials and monitoring plan use.

  4. ADL is one of the fiŌeen categories of supports funded by the NDIS and provides funding for self- care acƟviƟes, such as showering, eaƟng and moving around the house, and household tasks, such as meal preparaƟon, cleaning and yard maintenance. RaƟonale for undertaking the audit

    1. Prior audits1 and reviews2 have idenƟfied issues with NDIS planning, decision-making,

communicaƟons, service delivery, access to supports and fraud controls. This audit provides assurance to Parliament on the effecƟveness of the NDIA’s management of ADL supports and its management of operaƟonal risks, including the implementaƟon of recommendaƟons from prior audits. This audit was idenƟfied as a Joint Commitee of Public Accounts and Audit priority of the Parliament for 2019–20 and 2020–21. Audit objecƟve and criteria

  1. The objecƟve of the audit was to assess the effecƟveness of the NDIA’s management of assistance with daily life supports:

1Auditor-General Report No. 50 2018–19 National Disability Insurance Scheme Fraud Control Program, and

Auditor-General Report No. 14 2020–21 Decision-making Controls for NDIS Participant Plans. 2Completed inquiries include:

  • NDIS Planning (1 December 2020);
  • General issues around the implementaƟon and performance of the NDIS (30 November 2021); and
  • Current Scheme ImplementaƟon and ForecasƟngOFFICIALfor the NDIS (31 March 2022).
  • Does the NDIA effecƟvely support NDIS parƟcipants who require assistance with daily life?
  • Does the NDIA effecƟvely manage operaƟonal risks to the proper use of resources in administering assistance with daily life supports?

Conclusion

  1. The NDIA’s management of assistance with daily life supports was partly effecƟve. Seven out of nine recommendaƟons made by the Auditor-General in prior audits relaƟng to improved decision-making controls and fraud controls, which relate to the NDIA’s management of risks to proper use of resources, were not fully implemented.

  2. The NDIA has developed largely fit for purpose policies, procedures and guidelines to support the administraƟon of ADL, informed by feedback mechanisms and conƟnuous improvement processes. NDIA communicaƟons support staff, partner and provider understanding of ADL however, addiƟonal communicaƟons could be developed to support parƟcipant understanding. The NDIA conducts research to inform its communicaƟons approach and assesses its effecƟveness.

  3. NDIA’s planning and implementaƟon arrangements are largely fit for purpose. Results of internal quality reviews of decisions to fund reasonable and necessary supports are conƟnually below target. The NDIA publishes guidance material to assist parƟcipants to use their allocated funding and implement their plans, and monitors plan usage through regular reports. While the NDIA monitors and assesses parƟcipant outcomes through the collecƟon of feedback and data points, greater analysis could be undertaken to inform service improvement.

  4. The NDIA has partly effecƟve processes in place to manage the risks to the proper use of resources for all support categories, including ADL, with deficiencies idenƟfied in relaƟon to the quality of its decision-making, staff related conflicts of interest and fraud controls. The NDIA partly implemented recommendaƟons from Auditor-General Report No.14 2020–21 Decision-Making Controls for NDIS Participant Plans. NDIA has established and follows appropriate arrangements for seƫng prices for funded supports including ADL. NDIA’s management of conflict of interest risk is largely effecƟve for Board members, SES staff and Partners in the Community (PITC). Controls for managing APS staff and contractor providers of support coordinaƟon conflicts of interest are partly effecƟve.

  5. NDIA has a partly fit for purpose fraud control framework and has partly implemented recommendaƟons from Auditor-General Report No. 50 2018–19 National Disability Insurance Scheme Fraud Control Program. The NDIA has partly effecƟve controls for managing the risk of overclaiming by parƟcipants and providers.

SupporƟng Findings

Support for NDIS parƟcipants who require assistance with daily life

  1. NDIA has policies, procedures and guidelines that support NDIA staff and Local Area Coordinators (LAC) with the administraƟon of assistance with daily life (ADL) supports. The NDIA is currently changing its approach to publishing guidelines on its website to improve how it communicates with

parƟcipants. The NDIA has effecƟve processes to update OperaƟonal Guidelines. DocumentaƟon to govern NDIA staff access to Services Australia’s Centrelink system was inadequate.

  1. NDIA communicaƟons include the OperaƟonal Guidelines, ParƟcipant Booklets and web content. Some informaƟon is published in different formats, such as easy read, Braille, Auslan video and languages other than English. Local Area Coordinators support parƟcipants to understand ADL supports and include these within their plans where relevant. NDIA has Standard OperaƟng Procedures (SOPs) to support staff and partner implementaƟon of the NDIS, including ADL supports. ParƟcipant understanding could be improved with further research of the communicaƟon needs of specific cohorts.

  2. The NDIA has a structured process for developing and approving plans, based on the complexity of parƟcipants’ needs. Plans can be developed by Local Area Coordinators or NDIA planning officers and are then approved by a NDIA delegate. Plans up to the value of $385,000 can be developed and approved by a single delegate. The NDIA uses a typical support package (TSP) calculaƟon to aid consistency in decision making. The NDIA has not assessed the impacts on parƟcipant plan outcomes or scheme sustainability from high usage by planners of the World Health OrganizaƟon Disability Assessment Schedule 2.0 (WHODAS) assessment tool. Since October 2021, the quality of decisions to fund supports considered reasonable and necessary for parƟcipants’ needs have been below NDIA’s target of 75 per cent. NDIA’s results against its key performance measure of starƟng planning within 21 days of Scheme access decision have consistently been above its 95 per cent target since quarter one, 2021–22 and results against the performance measure of approving a plan within 56 days have improved since 2021–22 and reached the target for the first Ɵme in quarter two, 2022–23.

  3. The NDIA supports parƟcipants to implement NDIS funding for supports for acƟviƟes of daily life (ADL) through educaƟon and guidance materials and monitoring use of approved funding. NDIA publishes guidance and online resources to assist parƟcipants to connect with and choose NDIS support providers and spend the funding within their plan. ParƟcipants may receive funding for Ɵered levels of support coordinaƟon to help implement and manage their plan. ParƟcipant survey results indicated the majority understood what happens aŌer the plan is approved and where to seek assistance with implemenƟng their plan. NDIA monitors the implementaƟon phase by tracking the numbers of days it takes for a parƟcipant to acƟvate their plan from the date of approval. NDIA generates reports to idenƟfy those parƟcipants who have not acƟvated their plan within 90 days and may require addiƟonal support from NDIA staff or Local Area Coordinators. NDIA has established processes to support monitoring of plan use and connecƟng with parƟcipants at specified intervals or usage rates but does not monitor or report on compliance with these processes. NDIA policy does not assist staff to idenƟfy unexpected, overused or underused expenditure. Plan uƟlisaƟon rates averaged 75 per cent naƟonally with a gradually increasing trend.

  4. The NDIA assesses outcomes for parƟcipants, and their families and carers, including through short form and long form quesƟonnaires. These quesƟonnaires include parƟcipants who receive ADL funded supports but the results are not categorised by reference to ADL specifically. The survey results are reported monthly to the Board and quarterly to the Disability Reform Ministerial Council. NDIA collects comprehensive data but does not undertake analysis of trends or outcomes to inform service improvement. NDIA provided a 2019 data set to ABS for data linkage. The ANAO saw no evidence of plans for ongoing data linkages which could inform assessment of parƟcipant outcomes. The NDIA may improve its ability to measure parƟcipant outcomes in the future through the implementaƟon of its 2022–27 Research and EvaluaƟon Strategy.

NDIA management of risks to proper use of resources

  1. The NDIA has partly implemented the three recommendaƟons from Auditor-General Report no. 14 2020–21 Decision-making controls for NDIS Participant Plans. ICT controls aligned to policy requirements for planning decisions have not been implemented. The NDIA reports on the effecƟveness of its conƟnuous improvement acƟviƟes developed to address issues idenƟfied in quality monthly reviews. The NDIA does not analyse outcomes of internal or external reviews of decisions to inform conƟnuous improvement. The NDIA has aligned service delivery key performance indicators and quality metrics for reasonable and necessary decision-making.

  2. NDIA has established processes for seƫng the price limits that providers may charge parƟcipants for individual funded supports, which include a regular review of set prices and consideraƟon of benchmarks. NDIA demonstrated compliance with its internal requirement for price limits set for the 2022–23 financial year. NDIA’s Pricing Strategy defines three pricing levels and uses pricing regulaƟon to foster value for money and encourage increased supply in the market. The Pricing Strategy does not specify how NDIA’s performance against the objecƟve or criteria will be measured. NDIA has not set a Ɵmeframe for when price deregulaƟon will occur. NDIA has established a reference group with external stakeholder membership to undertake regular pricing reviews. The results of the 2021–22 pricing review were published on 22 June 2022 and took effect on 1 July 2022. The Annual Pricing Reviews are informed by financial benchmarking surveys of providers each year and the NDIS Disability Support Worker Cost Model. NDIA publishes the pricing limits for each support category on its website. The price limits for ADL support items have increased by 18 per cent from 2019–20 to 2022–23.

  3. The NDIA has established controls for idenƟfying and managing conflict of interest risks for its Board and Senior ExecuƟve Service (SES) staff, which include annual declaraƟons of material interests. The Board should implement procedures to manage conflict of interest risks arising from declaraƟons of members relaƟng to lived experience of disability. APS level staff are required to declare conflicts of interest but there are limited mechanisms to ensure this occurs. Combined with the lack of ICT controls for accessing parƟcipant records, staff controls represent an area of risk, especially for plan delegates. NDIA has largely fit for purpose controls for managing Local Area Coordinator conflict of interest risk, including requirements for these to be declared and reported to NDIA, and provision of compliance assurance statements to NDIA. NDIA was unable to quanƟfy the impact that conflicts relaƟng to support coordinators poses to parƟcipants.

  4. The frequency and rigour of NDIA’s assessment of fraud risks is insufficient given it has assessed the fraud risk associated with the agency’s acƟviƟes to be high. The 2019 Fraud and CorrupƟon Risk Register has been updated in November 2022 but not yet approved by the Board. The risk assessment that informs the overall risk raƟng assigned to fraud risks is not documented. The NDIA Board does not have adequate oversight of fraud risk. NDIA has not fully implemented four of the recommendaƟons from Auditor-General Report no. 50 of 2018–19 National Disability Insurance Scheme Fraud Control Program.

  5. NDIA uƟlises prevenƟon and detecƟon controls and compliance acƟviƟes to manage the risk of overclaiming. NDIA has idenƟfied key overclaiming risks for home and living supports, including ADL support types. The assessment has not idenƟfied controls or miƟgaƟon strategies for all risks. NDIA has inadequate system controls for claims for payment, in parƟcular, from self-managed parƟcipants. NDIA is piloƟng stronger controls for providers claiming the Temporary TransformaƟon Payment.

RecommendaƟons

  1. This report makes 15 recommendaƟons. Thirteen recommendaƟons are to the NDIA relaƟng to governance of systems access, planning, conflict of interest, and implemenƟng prior audit

recommendaƟons on controls for planning decisions and fraud. There is one recommendaƟon to NDIA and Services Australia to document arrangements for NDIA staff to access Centrelink informaƟon. There is one recommendaƟon to the Australian Government to align fraud control requirements for NDIA with those of non-corporate Commonwealth enƟƟes.

Recommendation No. 1

The NaƟonal Disability Insurance Agency (NDIA) and Services Australia document the arrangements for NDIA staff to access informaƟon in Services Australia’s Centrelink mainframe system, including

seƫng out the  legislaƟve  basis, terms and condiƟons  for  use, and  applicable governance

arrangements.

NaƟonal Disability Insurance Agency Response: Agreed

Services Australia Response: Not Agreed

Recommendation No. 2

The NaƟonal Disability Insurance Agency (NDIA) review:

a) the use of the World Health OrganizaƟon Disability Assessment Schedule 2.0 (WHODAS) tool by planners in developing parƟcipant plans, including analysis of plan outcomes, to assess the impact the use of this assessment tool has on parƟcipant plan outcomes and scheme sustainability; and

b) guidelines, procedures and web content to ensure it transparently conveys NDIA policy about the use of assessment tools consistent with legislaƟve requirements.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 3

The NaƟonal Disability Insurance Agency reviews the impact of its policy changes relaƟng to approval of plans that vary from Typical Support Packages (TSPs), including:

a) assessing the impact on plan funding outcomes, plan costs and overall scheme costs of no longer requiring higher delegaƟon approval of plans with funding that varies by more than eight per cent from the TSP; and

b) undertaking a post-implementaƟon review of its new integrated TSP calculator to ensure variaƟons from the TSP reference point are supported by appropriate evidence of parƟcipants’ circumstances and determine whether ongoing monitoring is needed. NaƟonal Disability Insurance Agency: Agreed.

Recommendation No. 4

The NaƟonal Disability Insurance Agency implement the first recommendaƟon of Auditor-General Report No. 14 of 2020–21 Decision- making Controls for NDIS Participant Plans by including controls relaƟng to parƟcipant planning consideraƟons and approvals within its new PACE ICT system, to align the system processes with internal policy requirements and to beter support planning processes for reasonable and necessary decision-making.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 5

The NaƟonal Disability Insurance Agency (NDIA):

a) fully implement the second recommendaƟon of Auditor-General Report No. 14 of 2020–21 Decision-making Controls for NDIS Participant Plans by using outcomes data from internal reviews and AdministraƟve Appeals Tribunal reviews (and other mechanisms such as Independent Expert Reviews), including early resoluƟon outcomes, to inform conƟnuous improvement in reasonable and necessary decision-making; and

b) regularly publish summaries of NDIA review data and analysis to improve transparency of review processes.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 6

a) The NaƟonal Disability Insurance Agency (NDIA) improve its management of conflicts of interest by implemenƟng:

b) procedures for how the Board manages conflicts arising from declared interests of members; c) mandatory requirement for all NDIA staff, contractors engaged by NDIA and Partners in the Community staff to make an annual declaraƟon of any real or apparent conflict of interest;

d) mandatory business pracƟces and ICT controls to restrict access to parƟcipant records that relate to a real or apparent conflict of interest reported to NDIA; and

e) CT controls to log all access and amendments to parƟcipant records in CRM and PACE, by staff, contractors and Partners in the Community and conduct regular audits of access logs for compliance with policies and declared conflicts of interest.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 7

The NaƟonal Disability Insurance Agency assess and quanƟfy the conflict of interest risks posed by providers delivering both support coordinaƟon and provision of supports to the same parƟcipant, and implement controls to miƟgate the risk to parƟcipants.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 8

The Board of the NaƟonal Disability Insurance Agency:

a) conduct a fraud risk assessment at least annually, unƟl such Ɵme as the board assesses that risk of fraud relevant to the agency’s acƟviƟes has moderated to less than high risk, at which Ɵme risk assessments be conducted consistent with the Fraud Control Policy;

b) idenƟfy those fraud risks that are outside the Board’s risk tolerance and regularly assess the treatments and controls for those risks; and

c) record the Board and risk commitee’s ongoing consideraƟon of fraud risk including the regular assessment and monitoring of fraud risks outside tolerance and the efficacy of controls.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 9

The National Disability Insurance Agency fully implement the first recommendation of Auditor

General Report No. 50 of 2018–19 National Disability Insurance Scheme Fraud Control Program by

regularly updating the Risk Register with planned controls, the delivery date and the project or activity under which the control will be developed and implemented.

National Disability Insurance Agency Response: Agreed

Recommendation No. 10

The NaƟonal Disability Insurance Agency fully implement the fiŌh recommendaƟon of Auditor-General Report No. 50 of 2018–19 National Disability Insurance Scheme Fraud Control Program and ensure visibility of the fraud control environment by providing regular reports to the Board containing a summary of the status of the Fraud and CorrupƟon Risk Register including:

a) the untreated and treated risk raƟngs for each of the fraud risk types; b) the controls effecƟveness raƟng for each of the fraud risk types; and c) the acƟons required on controls, with implementaƟon dates.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 11

When conducƟng risk assessments for each risk listed in the Fraud and CorrupƟon Risk Register, the NaƟonal Disability Insurance Agency document the factors considered, their weighƟng and the raƟonale for the overall risk raƟng. The Board should regularly review the risk assessment, including on each occasion it considers a proposed amendment or update to the Fraud and CorrupƟon Risk Register.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 12

The NaƟonal Disability Insurance Agency fully implement the fourth recommendaƟon of Auditor

General Report No. 50 of 2018–19 National Disability Insurance Scheme Fraud Control Program by

undertaking a review of its project management of fraud control. This review should:

(a) map all projects and acƟviƟes with fraud control dimensions, including their status, linkages, relaƟve priority and resourcing;

(b) determine whether addiƟonal projects or acƟviƟes are required to close any gaps between the fraud risks and the implemented and planned fraud controls within projects; and

(c) support updaƟng the Fraud and CorrupƟon Risk Register.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 13

The NaƟonal Disability Insurance Agency fully implement the second recommendaƟon of Auditor

General Report No. 50 of 2018–19 National Disability Insurance Scheme Fraud Control Program to

improve its acƟve fraud detecƟon methods by implemenƟng data matching acƟvity as a mater of priority, and on a conƟnuing basis.

NaƟonal Disability Insurance Agency Response: Agreed

Recommendation No. 14

That the National Disability Insurance Agency fully implement part (b) of the third recommendation

of Auditor-General Report No. 50 of 2018–19 National Disability Insurance Scheme Fraud Control

Program by establishing performance measures for its investigative functions that align with organisational goals for fraud investigations.

National Disability Insurance Agency Response: Agreed

Recommendation No. 15

The Australian Government aligns the fraud control requirements for the NaƟonal Disability Insurance Agency with those of non-corporate Commonwealth enƟƟes, including the Commonwealth Fraud Control Policy and the reporƟng requirements of subsecƟon 17AG(2) of the Public Governance, Performance and Accountability Rule 2014.

NaƟonal Disability Insurance Agency Response: Noted

Atorney-General’s Response: Noted

Summary of enƟty responses

  1. The proposed audit report was provided to the NaƟonal Disability Insurance Agency and extracts were provided to Services Australia (relaƟng to RecommendaƟon no. 1) and to the Atorney-General’s Department (relaƟng to RecommendaƟon no. 15). The summary responses, and ANAO rejoinder to Services Australia’s response are reproduced below.

NaƟonal Disability Insurance Agency

The NaƟonal Disability Insurance Agency (NDIA) welcomes the ANAO’s performance audit on the EffecƟveness of the NDIA’s management of assisƟng with daily life (ADL) supports.

The NDIA acknowledges the audit findings and agrees with the recommendaƟons. The NDIA is commited to strengthening its ADL support related governance, risk management and control environment to ensure it is effecƟvely managing key service delivery risks that may have adverse impact on the NaƟonal Disability Insurance Scheme (NDIS) as well as scheme financial sustainability pressures.

The NDIA will roll out its new ICT system (PACE) naƟonally in Q2 FY2023/24. The new ICT system is expected to beter support key service delivery processes, the control environment, monitoring

acƟviƟes and management  reporƟng  for effecƟve  decision  making.  In  this  regard, ANAO

recommendaƟons and improvement opportuniƟes in the report are most welcome.

The creaƟon of the Fraud Fusion Taskforce and recent NDIS funding announcement by the Australian Government as well as transiƟon to the new ICT system will enable NDIA to further improve its Fraud Control Program, management of conflict of interest risks and compliance monitoring.

The NDIA agrees with recommendaƟon no:15, noƟng this recommendaƟon is to be primarily addressed by the Australian Government. The NDIA welcomes the opportunity to contribute.

Services Australia

Services Australia (the agency) notes that the finding of the report that there was no writen protocol or agreement between the two agencies seƫng out the scope, terms or legislaƟve basis on which staff of the NaƟonal Disability Insurance Agency (NDIA) access the agency’s Centrelink mainframe to support verificaƟon of parƟcipant details.

The agency is focused on maintaining the security of customer informaƟon, and on ensuring that customer records are only accessed by appropriately authorised individuals or enƟƟes for a

documented business purpose  in  line with  relevant  legislaƟve or other Government  policy

requirements. To that end, the agency has a Statement of Intent with the NDIA that provides the overarching framework under which NDIA is granted access to certain agency systems, and a Protected InformaƟon Disclosure document that provides the legislaƟve basis. The agency provides access to Centrelink informaƟon systems on the basis of specified posiƟon numbers within NDIA. The access is provided as a result of a rule writen into the Centrelink mainframe and does not need to be individually requested by NDIA staff, as it is specifically associated with the requirements of those posiƟons. The posiƟon numbers are within the NDIA human resources organisaƟonal structure. The systems architecture documents provide further evidence of the controls that are in place to manage user access by NDIA staff in accordance with the above control framework.

ANAO comments on Services Australia’s summary response

  1. The ANAO assessed the Statement of Intent between NDIA and Services Australia and other documentaƟon received from Services Australia as not adequately seƫng out the scope, terms, legislaƟve basis and governance for NDIA staff to access Centrelink mainframe systems. The Disclosure of Protected InformaƟon to the NaƟonal Disability Insurance Agency instrument provided by Services Australia is a document recording the delegaƟon of decision-making authority from the Chief ExecuƟve Centrelink to various officers within Services Australia to authorise the disclosure of informaƟon to NDIA staff where it is to assist in the administraƟon of the NDIS or to support the work of the NDIS Fraud Taskforce and the NDIA’s Fraud and Compliance branch. Services Australia did not provide any

    documentaƟon of decisions made under the instrument, including its consideraƟon of the

appropriateness of a request by NDIA to disclose informaƟon or grant access to the Centrelink mainframe. The ANAO notes that the NDIA agreed to work with Services Australia to implement RecommendaƟon no. 1 by documenƟng ‘appropriate arrangements to govern the means of provision, removal, and audit of access to Services Australia’s Centrelink mainframe’.

Atorney-General’s Department

The Atorney-General’s Department notes recommendaƟon 15, which is directed to the Australian Government to align the fraud control requirements of the NaƟonal Disability Insurance Agency (a

Commonwealth  corporate  enƟty)  with  those  of  non-corporate  Commonwealth  enƟƟes.

ImplementaƟon of the recommendaƟon is a mater for government and the department will work closely with the Department of Finance, the NaƟonal Disability Insurance Agency and other relevant enƟƟes should it be pursued.