New NDIS Account to Lock in Funding
Thursday, 17th March 2016 at 10:31 am
The Federal Government has announced it will guarantee the final funding source for the National Disability Insurance Scheme by setting up a special “future fund” to hold Commonwealth contributions.
Social Services Minister Christian Porter introduced a Bill to Parliament to establish the NDIS Savings Fund Special Account. The Fund will collect underspends and savings that the Minister said would help meet the Commonwealth’s contribution to the scheme from 2019-20.
“We will set up the fund and then set aside specific, identified and protected savings,” Porter said.
“At full scheme in 2019-20, the NDIS will transform the lives of around 460,000 Australians who are living with disability. Today’s announcement will give them the final certainty they deserve.
“The Commonwealth will fully fund its on-going contribution to the scheme. We are committed to properly, adequately and sustainably funding the NDIS.”
Minister Porter said the new fund would have an opening balance of $162.4 million, which was set aside in the 2015-16 Mid-Year Economic and Fiscal Outlook.
“Lessons learned from the NDIS trials have identified some future costs during transition that will be lower than originally anticipated,” he said.
“The fund will allow us to pool and protect underspends and specific savings from across government over future years, locking them in as forward contributions to the NDIS.
“The fund will grow consistently over future budgets, allowing us to meet our NDIS funding requirements in 2019-20 and beyond.”
When the NDIS is fully operational in 2019-20, it is estimated to cost $22 billion each year.
The Commonwealth’s share will be $11.3 billion a year. Of that, an estimated $6.3 billion already has been identified:
- Existing Commonwealth disability funding ($1.1 billion/year)
- The Commonwealth share of the Medicare Levy contribution ($3.3 billion/year)
- Redirected funding, which is currently provided to the states for specialist disability services ($1.9 billion)
Finance Minister, Mathias Cormann said the Government must find $5 billion of additional funding to fully fund its absolute commitment to the full roll out of the NDIS.
“We’ve been upfront about the $5 billion NDIS shortfall we inherited from Labor, and we are meeting that responsibility head on in a clear and unequivocal way that will protect the NDIS for future generations,” Cormann said.
“This NDIS special account will be the structure that allows us to close the inherited funding gap – it’s the sustainable way to pay our bills, without racking up borrowings for future generations to repay.”
The National Disability Insurance Scheme Savings Fund Special Account Bill was introduced to the House of Representatives on Wednesday.