Health Minister Mark Butler guarantees no one will shift off NDIS without other supports waiting

Mark Butler has guaranteed he won’t cut people off the NDIS until alternative supports are in place, setting a deadline ticking for the States to get on board.

But premiers are pushing back on hefty expectations they will step up, despite Federal Health Minister insisting they’ve already signed up to spend the billions of dollars required.

Mr Butler unveiled a sweeping plan this week to reset the National Disability Insurance Scheme to its original purpose of supporting people with significant and permanent disabilities, and contain its galloping costs.

He wants urgent financial controls in place from July, but a new standard assessment for eligibility based on functional capability, not diagnosis, won’t be introduced until 2028.

The NDIS was budgeted to cost $52 billion this year, but that amount has blown out by $13b since December.

Prime Minister Anthony Albanese said the scheme had been on the verge of collapse.

“Every single Australian should get the care that they need, but what we shouldn’t have is a system that is growing exponentially — 22 per cent growth — unsustainably, costing more than Medicare and the PBS combined,” he said.

The plans to effectively freeze the funding for the next four years and significantly tighten eligibility from 2028 will save $35 billion by 2030 and well beyond $100 billion over the next decade compared with doing nothing.

But it will also see about 160,000 people currently receiving support removed from the NDIS.

Mr Butler said that number was an estimate based on “initial modelling” and an understanding of the cohorts of people using the scheme.

Key to the changes is the States rebuilding programs for people who need lower levels of support, which were largely dismantled when the NDIS started.

“Of course, we’re not going to change eligibility and move people off the scheme before we’re confident and we know the community is confident there are other systems of support in place,” Mr Butler said.

We don’t support a unilateral decision-making process where the Commonwealth makes announcements which impact on us.

“This is the commitment I gave with Thriving Kids, and yes, there was an arm wrestle about that, yes, there was a bit of a standoff about that, but ultimately I think governments all recognise we’ve just got to do this work for the sake of the community.”

However, asked several times to offer the same guarantee, Mr Albanese did not.

“We want to make sure that they get the care that they need,” he said.

Mr Butler says the premiers have already signed up to pay for half of the $10b for these so-called foundational supports, with only $4b of that allocated so far to the Thriving Kids initiative for under-9s.

Asked whether this was his understanding, WA Premier Roger Cook’s first reaction was: “When did we do that?”

He backed the need to reform the NDIS and said his State was getting on with the Thriving Kids work, but warned future shifts must be collaborative.

“We don’t support a unilateral decision-making process where the Commonwealth makes announcements which impact on us, both from a service delivery point of view, but materially, from a cost point of view,” he said.

His Treasurer, Rita Saffioti, went further, saying WA didn’t “want it to be a cost-shifting exercise”.

NSW leader Chris Minns warned that the States had already kicked in significant amounts of money.

“I’m not standing here saying don’t reform the system, but I am saying as part of that reform, we’ve got to be honest with people, and we can’t provide NDIS-like services at the State level,” he said.

“It’s not a question of me not wanting to do it. If I could, we would.

“But at the moment, we are under pressure . . . so taking on another major challenge, even one that’s handed over from the Federal government in good faith, I think people have got to be realistic about what the States can do.”

Mr Albanese said the Commonwealth would work constructively with the States and Territories, providers, and the community.

The NDIS wasn’t raised at Thursday’s National Cabinet meeting.