What is the National Disability Insurance Scheme (NDIS) and how does it work?


The National Disability Insurance Scheme (NDIS) has been trialled in selected Australian sites over the past three years. It is now providing funding packages to more than 25,000 Australians under 65 who have a permanent impairment that substantially reduces their intellectual, cognitive, neurological, sensory, physical, psychological and social functioning.

The number receiving the packages is expected to grow to about 460,000 when the scheme becomes fully operational in July 2019. When NDIS participants turn 65, they have the option to stay in the scheme or receive support through aged care services. People who develop impairments from 65 years onwards receive aged care support.

There are 4.3 million Australians aged 16 to 65 with disability and many will not meet the criteria to be eligible for the NDIS. They may still receive assistance through the scheme’s newly introduced programproviding information, linkages and referrals to connect people with disability, their families and carers with community and mainstream supports.

The NDIS will not replace the Disability Support Pension, which provides income support through Centrelink to people aged 16 to 65 who are unable to work because of their disability. The NDIS provides additional funding to meet the special needs of a person with disability, such as to buy a wheelchair or have assistance at home.

Why do we need the NDIS?

The NDIS was established in response to a 2011 Productivity Commission report that found disability services were “underfunded, unfair, fragmented and inefficient”. The commission recommended a system of flexible individual funding packages that could be used to purchase disability supports.

Before the NDIS, state governments contracted disability service providers to deliver specified services. For instance, some delivered personal care in the home, while others provided day activity centres and other services for people with intellectual disability.

Service provision across different states varied. The person receiving support was usually assigned to one disability service provider and restricted to the supports that agency provided, even when they wanted something different. It was also difficult for people to change service providers.

Disability activists supported the 2011 recommendations for the NDIS scheme and its focus on choice and empowerment to help those with disability meet their goals.

The amount allocated by the NDIS varies across individuals. Some eligible people in trial sites haven’t received any funding, such as when their goals were to maintain informal contact with family and friends. By contrast, some received large allocations, including those leaving disability institutions who needed considerable support to live in a five-person group home, a shared flat, or alone with support. The average individual allocation to date is A$39,600.