Introduction
NDIS is a welfare support scheme for the Australian disabled community, which was launched on 1st July 2013 – introduced by the Gillard Labor Government. The aim of the NDIS program is to provide financial support directly to people with significant or permanent disabilities and to minimize the effects of their disabilities on their individual lives. The beneficiary members can, however, opt to get the type of services at their discretion the way they would prefer to do the same. However, it may be counted as a minor drawback that to qualify for the support, the funding must be available in your area – there must be a qualified NDIS member in your area. Certain people are in dire need of funds, but the facility is not available near them for the lack of NDIS members. For receiving a support package from the NDIS, the following terms & conditions apply:
- You must be an Australian Citizen – a permanent resident or a protected unique category visa holder of the areas where the NDIS support is available
- You should have a permanent and significant physical disability or be in the early phases of one.
- At the time of application, your age should be under 65.
- That you should meet any other condition that you were required to meet in the individual case.
Funds’ Receipts & Disbursements
How the NDIS receives and disburses its funding is a complex process and one that can be reviewed in great detail. A question relevant to the process is whether or not the NDIS has been maintaining a significant level of equilibrium of the funds with regards to receipts and payments. The term equilibrium refers to the stability or balance of the contra effects of a transaction under any circumstances. Associate Professor Helen Dickinson explains how much finances the NDIS consumes and the sources from which the money is obtained. Helen Dickinson is an expert in public service who holds the position of Associate Professor, Public Service Researcher, and the Director of the Public Service Research Group at the School of Business, University of New South Wales, Canberra. She possesses exceptional experience in the following subjects:
- Governance
- Leadership
- Commissioning
- Priority Setting
- Decision-making
- Other relevant fields
The Consensus of Government
So, where do the funds actually come from? In the future, reliable funding for the NDIS is uncertain as the Government is planning to do away with a chunk of its proposed budget – as much as $8.2 billion in the Medicare levy. The planned reduction indicates that the NDIS does not need to be funded. It is pertinent to point out that in the last year, there had been no projected hope because the Labor agreed to raise for those only with income exceeding $87,000 per annum. This measure can add more credibility to the budget for the next financial year. The credit rating agencies are likely to scrutinise this, which will also be a valuable resource for the government.
However, Treasurer Scott Morrison has said in his speech that the fiscal position has improved as compared to the previous year. Based on this statement, the Treasurer further disclosed that they could assure Australians living with a disability as well as their families and caretakers of meeting all the planned expenditure for the NDIS from the current year’s budget. Furthermore, the facility shall be extended without increasing the Medicare levy. Further focal points in the speech were as follows:
- The government thinks that Labor has not redressed the funding gaps of the NDIS properly.
- Prime Minister Scott Morrison also said during his budget speech delivered on 8th May 2020 that “the economy is finally shaking off the dulling effects of the downturn in the mining investment boom”. Therefore, the economy is more robust, and the anticipated budget would, of course, be more substantial too.
- He also pointed that under the present situation, businesses have not been making much money, and he said that the crisis has had heavy toll on entrepreneurs as well as on the government.
- He also expressed the view that employers have a feeling of being stewed in their fat by keeping their employees at work.
- Despite this financial crunch, the employees’ wages shall be increased to some extent.
- As far as tax receipts are concerned, these had been $4.8 billion (till Feb) – higher than what we had estimated at MYEFO in December. In addition to $1.2 billion in higher individual tax receipts and $3 billion in higher company tax receipts.
- Morrison also stressed upon the need to control expenditure as far as possible.
- He, however, pointed out that Labor has proposed to increase the Medicare levy on those earning more than $87,000 per annum.
- There were some excellent points of the budget speech besides the above. The bottom line is that Labor is trying to withhold its promise to increase the levy for the higher income groups.
Funds’ Continuity
As a token of guarantee about continuous funding to the NDIS, Treasurer Scott Morrison has mentioned the support being availed by Gary Warren (brother-in-law to Morrison). Morrison said that Gary Warren had a health problem called sclerosis of a serious nature, and he entirely depends on the financial assistance that he receives from the National Disability Insurance Scheme.
Details of Support
The NDIS funding support is available based on the individuals’ needs such as provision of a transporting device for mobility (including a wheelchair) to help you transport yourself from your home to school / job & vice versa, to attend to household tasks, and to go to receive therapeutic support, etc.
Financing Agencies
The question is, where do these funds come from? Well, the Productivity Commission has suggested in its original report that for NDIS funding, the Federal Government should be the sole agency.
However, you may not consider that funding source as a simple one as the revenue comes from various sources. It’s a pooling system in which the funds come from the Commonwealth, the State, and the Territory Governments. 50% of the funds for the NDIS are provided by the Federal Government while the remaining 50% are contributed by the State and the Territories under mutual agreements renewable every five years. The contribution of funds to the scheme is realised through the NDIS Saving Fund Special Account established for the purpose.
NDIS Funds – Key Data
According to Labor, it was decided that the combined revenue streams shall ensure that the NDIS has been fully funded by 2023. Furthermore, the estimate was that the Commonwealth would contribute $11.2 billion approximately to the NDIS in the year 2019, out of which a sum of $6.8 billion shall be through receipt of existing disability funds and the share of the Disability Care Australia Fund provided by the Commonwealth.
Therefore, after the transaction mentioned earlier, the remaining funding gap is of around $4 billion per annum – provided the scheme gets fully operational. Also, the Commonwealth announced an increase in the Medicare levy from 2 to 2.5% of taxable income with effect from July 2019 for the purpose of filling up of the funding gap. It’s expected that such estimates would boost revenue during the first two years by $8 billion.
The Fate of the Bill
The bill has, however, been held in abeyance among the tripartite on the plea that the increase should not apply to all & sundry. Instead, the same should refer to the higher income tax groups:
- The Senate
- Labor
- The Greens
Redressal of the Grievance
Keeping in view the last week’s tax collections, the Treasurer stated that they had surpassed the target of receipts that was fixed for December. It endorses the fact that the levy was not required at all.
It is hoped that funding for the NDIS is no longer a big deal. Even so, there are certain people especially in the disabled community who are concerned about the continuity of funding for the long term.
Conclusion
In a nutshell, NDIS has been receiving its funds from the Federal Government, the State and the Territories, and disbursing the same to disabled people in a systematic manner. Even so, the equilibrium of receipts & payments has not been maintained adequately. Like other projects, NDIS also has a significant disparity in its demand and supply as the number of beneficiaries is 460,000. But despite all the bottlenecks, the scheme has been functioning vigorously, and it is hoped that the same shall continue in the future also. The NDIS is motivated to achieve the following important goals:
- Helping the disabled build relationships
- Finding jobs for the disabled
- Helping the disabled live a healthy life with dignity
- Delivering knowledge, good health, & wellbeing
- Establishing self-confidence
However, the recent wave of coronavirus (COVID-19) has changed the modus operandi including the pricing formula, plans, and reduction in personal interactions.