Submission on the Sustainability of Community-Based NDIS Providers

On behalf of the Board of Allevia Limited

House Standing Committee on the National Disability Insurance Scheme

EXECUTIVE SUMMARY

The Ask for Allevia’s Future

Allevia respectfully asks the House Standing Committee on the NDIS to recommend reforms that ensure the long-term sustainability of community-based disability service providers that deliver personalised, place-based supports to people with disability. Specifically, we seek a funding and regulatory environment that enables providers to meet increasing workforce, compliance, and insurance costs while continuing to invest in quality, innovation, and participant outcomes.

The NDIS has transformed the lives of many Australians with disability by promoting choice, control, and inclusion. However, the Scheme’s success depends not only on participant funding but also on the sustainability of the organisations responsible for delivering support every day. Allevia’s experience reflects a broader challenge across the disability sector, where increasing costs and regulatory obligations are placing significant pressure on provider viability.

Without a sustainable provider market, participant choice will diminish, workforce shortages will intensify, and communities may lose access to experienced, high-quality support services. We therefore urge the Committee to ensure that future reforms strengthen both participant outcomes and provider sustainability.

THE JOURNEY TO THE NATIONAL DISABILITY INSURANCE SCHEME

A quick Q&A -

Question - Why were the colony’s institutions all located on bodies of water?

Answer - Most were built in the 1800s and followed an English Common Law principle that ‘Mental defectives were forbidden from travelling on the Kings Highways’

Question - Why was 28 an important number for disabled pupils in parent owned and operated school in New South Wales until the late 1970?

Answer -— A child attending a parent-financed and operated school had to score 28 or above on a Standardised IQ test to receive a Publicly Funded Education in New South Wales until the assumption of responsibility for public school education for all children in the State became the norm and the State’s Policy position

Question - Which group of providers entered the NDIS on its commencement and where are they now?

Answer - Because NSW had a dedicated Department for Aged, Disability and Home Care the entry of providers within that Disability framework was a short transition period with those providers, and their participants, most often from historically developed service systems including the residual balance of the institutional settings, being an active part of the building of the systems and policies of the Scheme from its infancy.

ABOUT ALLEVIA

Allevia Limited is a long-established community-based disability service provider in New South Wales, and one of those early transitions, with origins extending across more than five decades. Throughout this period, Allevia has supported people with significant intellectual disability and complex support needs to live meaningful, self-directed lives within their communities from within a 24/7 operating environment.

As a provider that operated before the introduction of the NDIS, Allevia has participated in the evolution of disability services from the institutional models of the past to contemporary person-centred supports. The organisation has also

THE COMMENCEMENT OF THE NDIS AND PROVIDER EXPERIENCE

The NDIS was introduced with bipartisan support and represented a significant shift towards greater choice, control, and individualised support for people with disability. Allevia strongly supports the principles and objectives of the Scheme and recognises the transformative impact it has had for many participants and families.

Over the past decade, however, disability providers have operated in an environment characterised by increasing compliance obligations, regulatory oversight, workforce shortages, rising operating costs, and ongoing policy change. While reforms aimed at strengthening integrity and safeguarding are necessary, they have also increased the administrative and financial burden borne by providers.

The challenge for policymakers is to ensure that efforts to strengthen the Scheme do not inadvertently undermine the sustainability of the organisations required to deliver participant support.

THE SUSTAINABILITY CHALLENGE FACING TRADITIONAL PROVIDERS

Many long-standing providers entered the NDIS with extensive experience, strong community connections, and established safeguarding systems along with hard earned cash and other resource reserves. However, the economic assumptions underpinning the Scheme have proven difficult for many providers operating in complex service environments to sustain without leaning upon those reserves to bridge. policy and pricing gaps and to response to changing demands.

The influence of Commonwealth and State/Territory legislative requirements that impact sustainability of providers are now critical to provider survival in States/Territories with high aggregate workforce costs due to variability in areas - such as State controlled Workers Compensation Insurance costs impacting the bottom lines of all providers in NSW.

The 2025 National Disability Services State of the Disability Sector Report highlights widespread sustainability concerns, including provider losses, unfunded service delivery, policy uncertainty and concern that current pricing is not sustainable.

These findings are consistent with Allevia’s own experience and reinforce that provider sustainability is not an isolated organisational issue but a systemic challenge affecting the broad disability support ecosystem.

WORKFORCE, COMPLIANCE AND INSURANCE PRESSURES

Like many providers, Allevia has faced significant financial pressures arising from workforce costs, regulatory compliance obligations, and insurance expenses. These pressures intensified during the COVID-19 pandemic, when providers prioritised participant and workforce safety, often absorbing substantial unplanned costs associated with personal protective equipment, infection control, and workforce continuity.

While the sector has now moved beyond the immediate impacts of the pandemic, providers continue to face escalating operating costs. Of particular concern is the substantial increase in State-based workers compensation insurance premiums, which have become impossible to absorb within existing funding arrangements.

The cumulative effect of these pressures is reducing the capacity of Allevia and its peer providers to invest in innovation, workforce development, and service quality while maintaining financial sustainability.

FINANCIAL AND STRATEGIC IMPLICATIONS FOR ALLEVIA

Allevia’s Board has a responsibility to ensure long-term safety, continuity, and quality of support available to the people it serves. Increasing evidence regarding sector sustainability has therefore become a central consideration in strategic planning and governance decision-making.

In developing its 2026-2027 Budget, Allevia identified a projected operating deficit of approximately $431,000. Workers compensation insurance costs are the principal driver of this pressure: the final 2025-2026 premium was $614,102, while the current 2026-2027 premium payable is $715,481. The approved FY2027 budget includes total insurance expense of approximately $911,498 following further wages declarations due in April 2027.

Allevia Limited | Submission to the House Standing Committee on the NDIS

The Board has noted that frontline service delivery generally remains viable; however, increasing overhead and compliance-related costs are becoming increasingly difficult to sustain at the organisation’s current scale. Cash and investments dropped from approximately $2.081 million on 30 June 2025 to $1.603 million on 30 June 2026 and are forecast to decline by a further $284,000 across FY2027.

This pressure is compounded by the way NDIS pricing policy operates. NDIS price limits set the maximum amount that registered providers can charge for many supports and are applied nationally through the NDIA pricing framework. While these price limits are intended to support consistency, value for money, and Scheme sustainability, they do not always move in line with State-based cost settings imposed on providers by their State/Territory Government.

For a NSW provider, this means costs such as workers compensation insurance premiums, State-based employment obligations (e.g., portable long-service leave), insurance settings, and other jurisdiction-specific imposts must be absorbed within nationally determined prices that cannot readily be adjusted at the organisation level. Where those State-based costs increase faster than NDIS price limits, providers have limited capacity to recover the difference without reducing margins, drawing on reserves, limiting investment in workforce capability, or reconsidering the range and scale of services offered.

RISKS TO PARTICIPANTS AND COMMUNITIES

Provider sustainability is ultimately a participant issue.

When established community-based providers face increasing financial pressure, the consequences extend beyond organisational balance sheets. Reduced provider capacity can result in diminished participant choice, disruption of trusted support relationships, workforce instability, and fewer service options for people with complex needs.

For participants who reside and are supported within 24/7 Supported Independent Living this means the loss of a home, which for many has been for most of their adult life in terms of connections with housemates, engagement with trusted staff, and active presence in their local community. For Allevia’s clients with co-morbidity mental health challenges this can be a stressor which may undo stability, coping, and belonging that has taken years to achieve.

As the sector experiences increasing mergers, service rationalisation, and provider exits, there is a risk that participants and communities may lose access to local providers with extensive experience and established community connections.

RECOMMENDATIONS

Allevia recommends that the Committee consider reforms that:

Ensure NDIS pricing reflects the actual cost of delivering safe, high-quality disability supports.
Review the impact of workers compensation insurance costs on provider sustainability and market viability.
Recognise State-based cost variations within NDIS pricing policy, including workers compensation insurance, insurance, and employment-related obligations that differ between jurisdictions.
Acknowledge that the disability industry is a unique operating environment for which formula approaches across governments to workforce costs and sustainability require further bi-partisan investigation and revision
Reduce unnecessary administrative duplication and streamline compliance obligations while maintaining appropriate safeguards.
Develop a long-term disability workforce strategy focused on attraction, retention, and capability development.
Monitor provider sustainability as a key performance indicator of NDIS success.
Recognise and support the role of community-based not-for-profit providers delivering complex and high-needs services.
Recognise that the marketplace for longstanding providers is rapidly diminishing through the imposts of a Scheme that is now deemed unsustainable without major reforms, but which recognise the contributions across that revolutionary period and seeks to ensure that those providers can continue, with adjustment, into the future.
Establish ongoing mechanisms for meaningful consultation with providers regarding future reform implementation.

CONCLUSION: SECURING THE FUTURE OF INCLUSIVE COMMUNITY SUPPORT

For more than 58 years, Allevia has worked alongside people with disabilities, families, and communities to build lives of choice, independence, and belonging. We remain committed to the principles of the NDIS and to supporting Australians with disability to live meaningful and self-directed lives.

However, the success of the Scheme depends not only on participant funding, but also on the sustainability of the organisations that deliver support every day. Community-based providers such as Allevia face increasing financial, workforce and regulatory pressures that, if left unaddressed, threaten organisational ability to trade, reduce participant choice, and diminish the capacity of the sector to meet future demand.

CALL TO ACTION

Our call to policy makers is simple: build a NDIS that is sustainable not only for participants, but also for the organisations that support them.

We ask Parliament to work in partnership with providers, participants, and the disability community to ensure that future reforms deliver:

Sustainable pricing and funding arrangements;
A strong and skilled disability workforce;
Reduced administrative burden and duplication;
Regulatory settings that are proportionate and practical; and
Long-term certainty for participants, families and providers.

The future of the NDIS will ultimately be measured by the quality of life experienced by people with a disability. That outcome depends not only on funding participants, but also on sustaining the organisations that deliver support every day. Allevia urges policymakers to act now to ensure that provider sustainability, workforce capability and participant outcomes remain central considerations in the next phase of NDIS reform. The decisions made today will determine whether community-based organisations such as Allevia continue to provide choice, inclusion and opportunity for future generations of Australians with disability.

APPENDIX 1: ONE-PAGE EVIDENCE SNAPSHOT

Allevia Limited | Provider sustainability evidence available as at August 2026

Evidence area	Key data	Why it matters
Workers compensation premium trend	2024-25 final: $455,180. 2025-26 final: $614,102. 2026-27 current payable: $715,481.	A 57% rise across the two-year period from 2024-25 to 2026-27. The approved FY2027 budget includes total insurance expense of $911,498.
Operating results and forecast	FY2026 actual deficit: $224,216. FY2027 budgeted deficit: $431,000.	The FY2027 budget projects revenue of $11.697m and expenses of $12.128m.
Cash reserves and liquidity	30 Jun 2025: $2.081m. 30 Jun 2026: $1.603m. FY2027 forecast movement: -$284,000.	Cash and investments reduced by approximately $478,000 in FY2026. At 31 July 2026, cash at bank was $1.455m, equal to approximately 6.24 weeks of expenditure, below the Board benchmark of 12 weeks.
Sector-wide evidence: NDS 2025
		Nearly half reported a financial loss. 77% delivered unfunded services. 81% cannot continue at current NDIS prices.
		Average reported cost of unfunded services was almost $500,000 per provider; 92% cited policy uncertainty.
Scale of Allevia operations	Workforce: 123 workers Participants supported: `redacted`	The workforce figure is recorded in the 2026-27 workers compensation Certificate of Currency. A current participant count was not identified in the reviewed source material and should be verified against Allevia service data.

Evidence note. Financial figures are drawn from Allevia management reports, approved budget material, workers compensation policy documents and the August 2026 program review. Sector findings are from National Disability Services, State of the Disability Sector Report 2025. Forecasts are planning estimates and may change.

Internal sources: FY2025 premium calculation; FY2026 premium adjustment; FY2027 approved budget; June and July 2026 financial reports; FY2027 feasibility study; 2026-27 Certificate of Currency. External source: NDS State of the Disability Sector Report 2025.