Productivity Commission reinforces concerns about rushed NDIS rollout

By Stephen Easton

Thursday October 19, 2017

Decision Making Process, Risk Management

The Productivity Commission confirms the initial roll-out of the National Disability Insurance Scheme is not going to be completed on time, even with the federal agency going like the clappers to sign up new participants.

The National Disability Insurance Agency approved about 15,000 plans, or 165 a day, in the second quarter of this year. Based on its own modelling it will need to tick off about 500 a day, while also reviewing hundreds more. One of the major differences between the rollout and the PC’s original proposal is that the NDIA is much smaller than originally envisaged.

“The reality is that the current timetable for participant intake will not be met,” states the PC’s final report on the scheme’s costs. “Governments and the NDIA need to start planning now for a changed timetable, including working through the financial implications.”

The current estimate is that the agency will need a workforce of about 10,000 when the scheme is fully rolled out, of which 7000 will need to be outsourced to “partner organisations” due to a cap on directly employed staff that peaks at 3000 after the transition period is complete. The commission recommends the cap be removed, and also argues the NDIA should be an independent corporate entity, to ensure it can run as an independent insurance scheme, not as part of the public service under the control of current and future federal governments.

The NDIS has huge support but there are mixed views of the implementation among people with disabilities, service providers and academics. By far the most common complaint is that a strong focus from the government side on keeping the rollout on time and within budget has seriously compromised the outcomes for a lot of individual participants.

The ambitious timetable, which the federal government has no plans to extend, has led to the personalised support planning process being done quickly over the phone by staff with limited expertise due to its being outsourced. The goal is to get as many people on NDIS as possible, then worry about how well their needs are being met later.

“In the transition phase, the NDIA has focused too much on quantity (meeting participant intake estimates) and not enough on quality (planning processes), supporting infrastructure and market development,” according to the report.

“For the scheme to achieve its objectives, the NDIA must find a better balance between participant intake, the quality of plans, participant outcomes, and financial sustainability.”

The report advises that “greater emphasis is needed on pre-planning, in-depth planning conversations, plan quality reporting, and more specialised training for planners” by the federal agency.

The scheme is not heading for a cost blowout, according to the commission’s analysis. In fact, 1.5% of the budget for the trial sites was left over after three years. Some costs were higher than expected — there were more eligible children than predicted, for example — but this was more than offset by the fact that “not all committed supports were used”, which is not necessarily a good thing.

“While lower than expected levels of utilisation means lower scheme costs, it also implies poorer outcomes for participants,” the PC explains. It is too early to revise the $22 billion projected cost of the transition to full scheme.

The report also confirms that supply in the disability services and support workforce is not likely to meet demand and recommends significant government intervention in the market including independent price monitoring and regulation, as well as a targeted migration program: “It is estimated that 1 in 5 new jobs over the next few years will need to be in disability care, but workforce growth remains way too slow.”

Another aspect of the NDIS is that it allows state governments to step back from some services they have provided, and the report also backs up concerns that this transition is not being managed effectively.

“Some disability supports are not being provided because of unclear boundaries about the responsibilities of the different levels of government. Governments must set clearer boundaries at the operational level around ‘who supplies what’ to people with disability, and only withdraw services when continuity of service is assured.”

The Treasurer asked the PC too look at the scheme’s costs but the report points out “benefits are just as important” and the findings are framed accordingly. It notes:

“Taxpayers’ willingness to fund the NDIS will depend on their perception of value for money, in terms of:

  • people with disability experiencing better lives as a result of the scheme
  • the scheme making it easier for families and carers to play a supporting role
  • the way the scheme invests in people with disability
  • the confidence taxpayers have that the NDIS will be available to cover their care needs (or those of their loved ones) should a disability be acquired in the future
  • the supports that are funded (and the evidence base to support what is funded)
  • efficiency gains and cost savings in the disability support system and other government services.”

Happily, the PC reports some benefits are already being realised, for some participants. But it also acknowledges average satisfaction has begun to fall, and says it’s the more complex cases where most trouble lies.

“The groups at risk of having a less positive experience include those with psychosocial disability, complex and multiple disabilities, and language and cultural barriers, as well as people with disability transitioning into the community from the criminal justice system, the homeless and the socially isolated,” according to the report.

The PC highlights the fact that multiple separate problems have emerged during the transitional period to get all currently eligible people into the NDIS and combined, they present a major risk to success of the ambitious reform.

“And all this is against a backdrop of significant change in governance and funding arrangements (with some arrangements still to be bedded down). The arrangements are also tied to insurance-based principles that do not fit easily within the existing model of government oversight.

“The newly established Agency also needs to find and skill staff, while developing operational guidelines from scratch under circumstances where legislation is untested. The transition period is going to be more protracted than previously expected.”

NDIA has ‘learned from the past’

Meanwhile, the NDIA has listened to complaints and announced a new “pathway” that aims to improve the experience of interacting with the scheme for participants and service providers alike.

“Central to the new participant pathway is the delivery of face-to-face engagement for all NDIS plan development, based on the individual’s preference,” says a statement published yesterday. “This improvement has already resulted in a substantial increase in the number of plans being developed in person.

“Having learned from the past, the new pathway will now be progressively piloted and tested over the coming months before being rolled out nationally. The NDIA will continue to engage with stakeholders on the testing and implementation of the new pathway.”

The changes include “a consistent point of contact, who plays a key role in empowering participants to achieve outcomes” and a promise that planning will be done by “a skilled Local Area Coordinator or NDIA planner who will spend time understanding the unique needs of each participant”.

“We also need a strong and vibrant provider market that contributes to improving outcomes for participants,” sais CEO Robert De Luca.

“As part of the new provider pathway, the NDIA will provide better information and insights to support business decisions and make it easier for providers to transact with the Scheme and connect with participants.

“Implementing all improvements will take time, but we are committed to responding as quickly as possible to the feedback. It is important to get the new pathway experience right before implementing all the improvements across Australia. To that end, we will be proceeding to pilot the new pathway before it is rolled out nationally.”

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