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NDIS – Time to Save Money and Deliver on a Promise

15 June 2017 at 9:02 am
David Gilchrist
There is considerable support for a modified planning process for the National Disability Insurance Scheme, writes Dr David Gilchrist as he unpacks his latest research, released on Thursday.

David Gilchrist | 15 June 2017 at 9:02 am


NDIS – Time to Save Money and Deliver on a Promise
15 June 2017 at 9:02 am

There is considerable support for a modified planning process for the National Disability Insurance Scheme, writes Dr David Gilchrist as he unpacks his latest research, released on Thursday.

The NDIS is expensive and risky – at full roll out it is intended to impact almost half a million people, cost around $22 billion and reach every community in Australia. As such, we all want it to be successful. However, one of the most fundamental elements of the scheme – the service planning process – is in need of a rethink in order to give the NDIS a chance at delivering on its promise.

A new report out today [Thursday], commissioned by the Independent Centre for Not-for-profit Research (ICANR) and undertaken by myself and a team at the advisory firm BaxterLawley, shows that there is considerable support for a modified planning process that is risk-based, involves providers where appropriate, and recognises that this critical part of the NDIS process can be delivered more cheaply and more effectively than the current arrangements allow. Indeed, a risk-based approach to planning may see savings in the vicinity of $400 million per annum – all of which can be reallocated to service delivery.

At the highest level, the NDIS is aimed at increasing choice and control in services and supports for hundreds of thousands of Australians living with disability. Indeed, this is an aspiration that, along with the NDIS itself, is virtually universally supported. This aspiration is intended to be protected by certain operational aspects of the NDIS, including in relation to the role played by Australia’s disability service organisations or providers. In fact, there has been an enduring concern that providers may impede the opportunity for participants in the NDIS to exercise choice and control and, notwithstanding a lack of evidence to support such a notion, a number of restrictions have been placed on the role of disability service providers in order to avoid undue influence. These restrictions are negatively impacting the effectiveness of the scheme and resulting in higher costs – in money, quality and timeliness – to participants, the NDIS and service providers.

The planning process is the critical first stage in ensuring participants have the choice and control we all support. However, under the current regime wherein only NDIS personnel or certain non-provider personnel are able to conduct the planning process, planning alone is expected to cost around $1.76 billion during the roll out period to 2020 and then between $900 million and $1 billion per annum thereafter. And there is building evidence that the process is not achieving a quality outcome that might be expected for the sum paid.

Ostensibly in defence of participant’s opportunity for choice and control, disability service providers are prevented from having a significant role in the planning process as the NDIS is concerned that they are conflicted and may be biased in their planning suggestions. Instead, the NDIS relies on its own staff and some contracted personnel to undertake this important process. However, many NDIS planners lack the experience and the qualifications to prepare plans – a problem that is likely to grow as demand for plans outstrips capacity to develop them. Additionally, the NDIS itself also has a conflict in that the planning process is used to establish a budget for participants and can be used as a lever to assist the NDIS to remain sustainable.

By excluding service providers from the service planning process, the NDIS is costing more to implement and delaying service delivery. However, it is service users who stand to lose most. Indeed, this situation jeopardises the prospects for the scheme to achieve its universally supported objective of providing choice and control to those Australians with disability because the quality of the plans has been questioned, the prospect for the development of clinically inappropriate plans being developed may be increased and there is no flexibility in relation to situations where providers are also guardians or have had a long relationship with their clients. Critically, it is also negatively impacting the ongoing capacity of service providers at a time when the success of the NDIS roll out relies heavily on being able to deliver timely, efficient services.

More generally, an ongoing weakness in the NDIS roll out process has been the lack of involvement of disability service providers. This means that organisations with highly skilled and experienced people who often have significant knowledge of their clients have been excluded from the planning process.

In this report, we suggest that a hybrid planning process inclusive of service providers and supported by a risk-based regulatory program can help to ensure higher quality and timely plans can be activated within a framework that is actually cheaper for the NDIS to support.

About the author: Dr David Gilchrist is a chartered accountant and an economic historian. He holds a PhD in economics from the University of Notre Dame Australia and is currently professor of accounting at the University of Western Australia. He was foundation director of the Curtin Not-for-profit Initiative for five years. He currently holds a number of industry roles including as chairman of Nulsen Disability Services, a director of BaxterLawley Advisory, a member of Chartered Accountants Australia and New Zealand’s National Not-for- profit Advisory Committee, a member of the Australian Charities and Not-for-profits Commission Advisory Board and of the Australian Accounting Standards Board Academic Advisory Panel. In his work, Gilchrist has advised a number of Australian governments and authorities relating to human services governance, sustainability, accountability and strategy, most recently related to the NDIS amongst other things.

David Gilchrist  |  @gilchristdj

Dr David Gilchrist is a chartered accountant and an economic historian. He is currently professor of accounting at the University of Western Australia.

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