NDIA Accountability Project

Submission 66 — Unbound Minds — Inquiry into the Thriving Kids initiative

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Submission to the House of Representatives Standing Committee on Health, Aged Care and Disability

Committee Secretary

Joint Standing Committee on the National Disability Insurance Scheme

PO Box 6100

Parliament House

Canberra ACT 2600

30th September 2025

Re: Protecting High-Return Investment: The Case Against Reducing Intensive Early Childhood Intervention in the NDIS

Unbound Minds presents this submission to the Joint Standing Committee on the National Disability Insurance Scheme (NDIS) to address proposed reforms that would shift children under nine with developmental delays and disabilities from individualised, intensive NDIS plans to less intensive, group-based “foundational supports.”

While we support the development of a robust ecosystem of supports for all children, we argue that reducing access to proven, high-intensity early intervention for NDIS participants would be a profound clinical and economic mistake. This submission will demonstrate, with reference to international best practice and extensive evidence, that such a move represents a false economy. It would risk poorer lifelong outcomes for Australia’s most vulnerable children and generate far greater long-term costs for the health, education, and justice systems.

We contend that the path to NDIS sustainability lies not in cutting the most effective and evidence-based services, but in addressing systemic inefficiencies, overcharging, and fraud within the scheme.

THE SCIENTIFIC IMPERATIVE FOR INTENSIVE EARLY INTERVENTION

The proposal to transition children under nine to less intensive supports fundamentally contradicts decades of neuroscientific and developmental research. The period from birth to age five is a unique and critical window of brain development where neural plasticity - the brain’s ability to adapt and form new connections - is at its peak. Intervening during this time is not merely beneficial - it is the most effective and efficient opportunity to alter a child’s developmental trajectory.

INTERNATIONAL BEST PRACTICE AND EVIDENCE

International best practice, endorsed by bodies like the World Health Organization, emphasises timely, evidence-based psychosocial interventions to improve communication and social skills in children with developmental disabilities. A robust body of evidence validates the effectiveness of intensive early intervention models:

  • Improved Long-Term Outcomes: High-quality, intensive programs lead to lasting improvements in cognitive ability, adaptive behaviour, and social skills, while reducing the severity of symptoms. Research on models like the Early Start Denver Model (ESDM) shows that children who receive intensive therapy maintain these gains and require significantly fewer services in later years.
  • Intensity is Critical: The National Research Council in the United States recommends a minimum of 25 hours per week of active engagement for young children with autism to achieve meaningful gains. Shifting to less intensive, group-based models would deny many children the therapeutic dosage required to achieve these life-changing outcomes.
  • The Cost of Inaction: Insufficient or delayed intervention makes it harder for children to meet their developmental milestones over the long term. This can lead to poorer academic performance, increased behavioural and emotional difficulties, a greater need for special education services, and reduced likelihood of independent living in adulthood.

Reducing the intensity of support for children with diagnosed needs is a high-risk strategy that ignores the foundational science of child development. It mistakes a critical, time-sensitive investment for a discretionary expense.

THE ECONOMIC FALLACY OF REDUCING EARLY INTERVENTION

Investing in high-quality early childhood intervention is one of the most powerful economic strategies a government can employ. Research led by Nobel Laureate economist James Heckman demonstrates that for every dollar invested in high-quality early childhood programs, **the return on investment (ROI) can be as high as 13% per annum, yielding up to $13 over a child’s lifetime.**1

These returns are generated through:

  • Reduced Future Costs: Better long-term health and developmental outcomes reduce lifetime expenditure on healthcare, special education, and the justice system.2
  • Increased Economic Contribution: Individuals who benefit from these programs achieve higher levels of education, secure better employment, and pay more in taxes over their lifetimes.3

While the 13:1 figure relates to comprehensive programs, the ROI for targeted mental health and disability prevention is also strongly positive, with reviews finding returns **between $1.80 and $3.30 for every $1 invested.**4 One study found that effective early intervention can reduce the lifetime costs of care by up to 65%.

Conversely, the long-term economic costs of childhood psychological and developmental problems are immense. US-based research found that such problems lead to a 20% reduction in family income during adulthood, with an estimated lifetime cost of approximately $300,000 per individual in lost income alone.5

Cutting intensive early intervention is a classic example of a false economy. It generates minor short-term savings at the expense of incurring far greater, long-term liabilities across multiple government portfolios.

ESTIMATED COST-SHIFT AND PRUDENT ALTERNATIVES FOR NDIS SAVINGS

The proposal to move children under nine from individual NDIS plans to “foundational supports” is driven by a desire to reduce scheme costs. As foundational supports are intended to be funded outside the NDIS through joint Commonwealth-State agreements,

this represents a 100% cost-shift away from the NDIS for every child transitioned out of the scheme. This creates a significant financial incentive to reduce access to individualised NDIS plans.

Estimated Savings Calculation:

  • Number of Participants: As of the fourth quarter of the 2024-25 financial year, there were 173,465 NDIS participants aged 0–8.
  • Average Plan Cost: Common funding packages for early intervention are reported to be in the range of $18,000 to $20,000 per year. Using a midpoint of $19,000 per participant.
  • Estimated Transition Cohort: While precise data on severity is unavailable, policy discussions focus on children with developmental delay and mild to moderate autism. A conservative estimate is that this represents approximately 70% of the early childhood cohort. This equates to an estimated 121,426 participants (173,465 × 70%).
  • Potential Annual Saving to the NDIS: If this majority cohort were transitioned to a system funded outside the NDIS, the direct saving to the NDIS scheme would be approximately $2.3 billion per year (121,426 participants × $19,000).

This potential saving of $2.3 billion does not need to be found by compromising the futures of children with disabilities. More sustainable and clinically responsible savings, which meet or exceed this amount, can be achieved by addressing systemic issues of fraud, waste, and inefficiency.

Alternative Avenues for Savings:

  1. Combat Fraud, Overcharging, and Waste (Estimated Annual Saving: $2 Billion+): The most significant source of potential savings lies in strengthening scheme integrity.
    • Scale of the Problem: Recent estimates suggest that nearly 5% of the NDIS’s $42 billion budget - approximately $2 billion per year- is lost to fraud, errors, or non-compliant spending. Some reports suggest the figure could be as high as $8 billion. This figure alone could cover a substantial portion of the costs associated with the early childhood cohort.
    • Targeting Criminal Activity: The government’s Fraud Fusion Taskforce is investigating over 100 cases involving more than $1 billion in NDIS funding. These cases involve providers falsifying reports, billing for services never delivered, and creating fake businesses. Fully resourcing this taskforce to detect and prosecute fraud would yield substantial savings.
  • Cracking Down on Overcharging: The NDIS Commission and the ACCC have acknowledged that some providers unfairly charge NDIS participants higher prices. Enforcing the NDIS Code of Conduct, which prohibits unjustified price differentiation, and penalising non-compliant providers would secure significant savings.

  1. Improve Operational and Pricing Efficiency: The Independent Review into the NDIS highlighted the need to improve the scheme’s design and operations.

    • Smarter Pricing: The Independent Pricing Committee found the NDIS’s current pricing approach to be unsophisticated. Implementing a more “nuanced approach” with data-driven price differentiation would create better outcomes and a more efficient market.
    • Strengthen Regulatory Oversight: A performance audit by the Australian National Audit Office (ANAO) found that the NDIS Commission lacked a mature regulatory risk framework to guide its decision-making. Implementing the ANAO’s recommendations to improve data analysis, risk assessment, and compliance monitoring would reduce wasteful spending.

  2. Re-direct Funding from Ineffective Supports to Evidence-Based Interventions: Rather than cutting a category with proven long-term benefits, savings could be found by auditing other areas of NDIS spending. For example, reports have noted that funding for psychosocial disability supports is often “poorly aligned to the evidence about what works best”. This criticism is not aimed at clinical, evidence-based professions like psychology. Rather, it targets a systemic issue where NDIS funding is used for generic, non-therapeutic, or unstructured supports that are not part of a cohesive, recovery-oriented plan. The NDIS Psychosocial Disability Recovery-Oriented Framework itself is built on principles of supporting personal recovery and ensuring an evidence-based approach.6 A systematic review of all support categories could identify areas where funding is not delivering value for money. These funds could then be redirected to either reduce the scheme’s overall cost or reinvest in high-impact, capacity-building services delivered by qualified professionals.

  3. Additional Savings Opportunities:

    • Strategic Investment in Assistive Technology (AT): Upfront investment in appropriate AT can reduce long-term reliance on more costly person-to-person supports. A strategic approach to AT provision, focusing on long-term value and participant capability, can generate significant downstream savings.
    • Optimising Plan Management: While plan management provides crucial support, optimising the systems and processes used by plan managers through better

technology and streamlined reporting can reduce administrative overhead and create efficiencies across the scheme.

  • Reducing Administrative Appeals: The average cost of an Independent Expert Review is over $10,000, while proceeding to an AAT hearing costs nearly $30,000 on average. These formal disputes are not only costly but are often stressful and adversarial for participants. Investing in better upfront decision-making, clearer guidelines, and improved communication would reduce the number of costly appeals. This approach directly aligns with the NDIS Review’s core goal to “put people with disability back at the centre of the NDIS” and the NDIA’s commitment to being “transparent, responsive, respectful, [and] empowering”. Reducing the need for appeals saves significant administrative resources while dramatically improving the participant experience, helping to “restore trust, confidence and pride in the Scheme”.7

The combined total of these alternative savings pathways is more than sufficient to cover the $2.3 billion annual cost of the early childhood cohort, making the proposed cuts a false and unnecessary economy.

RECOMMENDATIONS

Based on the evidence presented, Unbound Minds puts forward the following recommendations:

  1. Protect and Enhance Investment in Intensive Early Intervention: That the Committee recommends the Government protects and enhances funding for evidence-based, intensive, and individualised early childhood supports for NDIS participants under the age of 9, recognising this as a critical, high-return investment in both human potential and long-term economic sustainability.
  2. Prioritise Scheme Integrity for Savings: That the Committee recommends the Government mandate that necessary scheme savings be found by aggressively targeting fraud, waste, and overcharging. This should include expanding the resources and powers of the Fraud Fusion Taskforce and the NDIS Quality and Safeguards Commission to investigate and prosecute non-compliant and criminal behaviour.
  3. Implement Operational Efficiencies: That the Committee recommends the NDIA urgently implement the operational efficiencies identified by the NDIS Independent Review and the ANAO, particularly regarding the development of sophisticated pricing models and risk-based compliance frameworks, to ensure scheme sustainability without compromising essential, evidence-based services.

CONCLUSION

The path to a sustainable NDIS does not lie in diminishing the futures of children with disabilities. The scientific and economic evidence is unequivocal: reducing access to intensive early intervention is a false economy that will lead to poorer outcomes for individuals and higher long-term costs for the Australian community. The necessary savings can and must be found by strengthening the integrity and operational efficiency of the scheme. We urge the Committee to protect this vital investment in Australia’s children.

Yours sincerely,

redacted

Justin Khoury

Chief Executive Officer

Unbound Minds

REFERENCES

  1. The Economic Case - Parent-Infant Foundation, accessed September 30, 2025, https://parentinfantfoundation.org.uk/why-we-do-it/the-economic-case/

  2. Early Child Development - Return on Investment, accessed September 30, 2025, https://cdn.ymaws.com/www.alphaweb.org/resource/collection/O5A9A2C5-9B9C-4F25-96F6-B36E8936647A/TPH_ECD_ROI_BN_190119.pdf

  3. The Return on Investing in Children | Urban Institute, accessed September 30, 2025, https://www.urban.org/sites/default/files/2023-09/The%20Return%200n%20Investing%20in%20Children.pdf

  4. COST-EFFECTIVENESS OF INFANT AND EARLY CHILDHOOD MENTAL HEALTH TREATMENT - Georgetown University Center for Child and Human Development, accessed September 30, 2025, https://gucchd.georgetown.edu/Docs/iecmh/Cost-Effectiveness%200f%20Infant%20and%20Early%20Childhood%20Mental%20Health%20Treatment.pdf

  5. Long-Term Economic Costs of Psychological Problems During Childhood - PMC, accessed September 30, 2025, https://pmc.ncbi.nlm.nih.gov/articles/PMC2887689/

  6. Psychosocial Disability Recovery-Oriented Framework - NDIS, accessed October 1, 2025, https://www.ndis.gov.au/understanding/how-ndis-works/psychosocial-disability/psychosocial-disability-recovery-oriented-framework

The NDIS Review, accessed October 1, 2025, https://www.ndis.gov.au/about-us/improving-ndis/changes-ndis-legislation/ndis-reviewYours sincerely,

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