Policy Progress: How does Australia’s NDIS fare?

By Isabella Royce | 16 Jul 13

This article is part of our July focus on “Australia in the World”. Click here for more articles in this issue.

By Isabella Royce

Coming into force this July, the National Disability Insurance Scheme Act 2013 (Cth), known as Disability Care Australia or NDIS, continues to occupy a great deal of the media’s attention. With an emotive introduction to Parliament by Prime Minister Gillard and rare bi-partisan support, the question circling many Australian households is: what is the NDIS?

The NDIS, in short

As explained by ABC contributor Ya’el Frisch in Ramp Up, the Scheme is entitlement, not welfare. This is an important distinction between the NDIS and its predecessor, the Disability Support Pension (DSP), as the DPS was a means-tested, income supplement based on historical budget allocations which viewed Australians with disabilities as essentially “passive welfare recipients” with little control over the little funds available. The wealth of support for the NDIS comes from its insurance approach, in which the costs of disability care are shared amongst the community to ensure that eligible recipients receive the lifetime support they need to fully participate in the mainstream community. Funding will be granted to applicants on an annual basis rather than through a weekly pension, to provide for services, aids and equipment.

Most importantly, the insurance scheme collaborates with participants through the Launch Transition Agency to develop a personal, goal-based plan tailored to the individual’s desires and needs for not just a manageable life, but a meaningful and socially-inclusive existence. As an Australian with a disability, Stella Young explains “discussions about money are beside the point (for people with disabilities).” She continues, “We don’t think in terms of dollars; we think in terms of showers per week, mobility aids that meet our needs and general access to our communities.” The question thus becomes not “what disability do you have?” but “what are its impacts on your life?”

Eligible participants for NDIS funding are persons with a disability that is, or is likely to result in, permanent impairment. The impairment must be substantial and reduce the person’s functional capacity in communication, social interaction, learning, mobility, self-care and/or self-management. Under section 3(d) of the Act , eligible persons will develop an individualised plan of their goals and aspirations with the Launch Transition Agency and determine what is “reasonable and necessary” to achieve their plan. As a stated objective of the Act is to promote innovative support to maximise independent lifestyles, the scheme moves away from stereotyped service models and looks at what is necessary to fully accommodate people’s needs, rather than providing only basic services. The 2013 Federal Budget revealed the Australian Government’s commitment of $1 billion over four years to support the first stage of the NDIS, with funding to begin in July 2013 for around 10,000 people with significant disabilities and aimed to increase to 20,000 people from mid-2014.

How do we compare with other nations?

While this step has been met with wide support and is seen as a progressive leap in our society, how do we actually fare globally? According to a World Bank report (PDF File) “across the world, pension systems and their reforms are in a constant state of flux driven by shifting objectives, moving reform needs and a changing enabling environment.” This is certainly true of the recent reassessments in the UK in the wake of the financial crisis.

Britain’s Disability Living Allowance (DLA) was replaced on 10 June 2013 by the Personal Independence Payment (PIP), which works as a pension requiring more frequent assessment of claimant’s disabilities and seeks to reduce the number of people allegedly “abusing the system”. In contrast to Australia’s NDIS, PIP aims to reduce the number of eligible claimants, which has risen by 30 per cent to 3.3 million in the last ten years, and will cut pension spending by £2.24 billion pounds between now and May 2016. The result will be approximately 500,000 fewer claimants and a reduction of indefinite lifetime awards granted; a figure that currently stands at 70 per cent of recipients. According to BBC News, claimants fear the new PIP will not be able to fully accommodate the extent of their needs. This goes some way to emphasise the progressiveness of Australia’s scheme, which aims to work personally with claimants to design a plan tailored to their individual needs. The UK’s PIP requires ongoing assessment carried out by private multinational contractor Atos Origin to determine whether or not individuals are “fit for work” and eligible persons will receive a daily living pension of £53 or £79.15 a week and a mobility component of either £21 or £55.25. In terms of global progress, it thus appears that the UK’s rigid pension scheme is falling behind Australia, with emphasis placed on restricting “abusers” and saving pence, rather than principles of social inclusion and individual control.

However, disability schemes are not an exclusively first-world concept, with the findings in Cuba proving to be quite surprising. In 2001, even members of Britain’s House of Commons Health Select Committee acknowledged  “the success of the Cuban health care system”.  While the nation has experienced its fair share of devastating historical blows, such as the loss of 80 per cent of its trade following the collapse of the Soviet Union in the 1990s and the 51 years of a United States trade embargo, the nation’s healthcare and disability benefits have remained a top national priority. The 1995 Action Plan for Care for Disabled Persons has been praised by many institutions, including the Inter-American Institute on Disability and Inclusive Development, and is based on the popular “Pay As You Go” (PAYG) pension system. To receive a full pension, claimants must have a physical or mental inability to work, and if eligible will receive 40 per cent of their average earnings taken from the highest five of the last ten years, plus one per cent of earnings per year of employment. For partial-pension claimants (that is, those unable to perform usual work) 30 to 50 per cent of lost earnings will be awarded, depending on the number of years of employment. While the main focus is on work-related disabilities, the generous payouts ensure that claimants receive substantial assistance from a government with far smaller budgetary capacity than developed nations. This goes to show that a commitment to fair and inclusive policies does not have to be seen as dependent on an economic boom.

Progress requires a change of perception

While many believe that Australia’s NDIS is well-overdue, it appears we are still leading the way ahead of our Common Law ancestor, Britain, in terms of a socially-progressive and individualistic approach to disability schemes. Perhaps the overriding notion to draw from all this can be summed up by the Disability Rights Education and Defence Fund (DREDF) in that we must see people with disabilities as “subjects with legal rights, and not objects of welfare, health and charity programs.”  The prevalent social policy behind our previous legislation and many other global schemes has been one that segregates and excludes people with disabilities from mainstream society and provides little stability in year-to-year assessment and changing criteria. It is in this sense that NDIS marks an important shift in national perceptions towards people with disabilities and a positive global step towards more socially inclusive policies.