The NDIS is expected to be discussed at the meeting of federal and state leaders in Sydney on Wednesday and Thursday.
by Laura Tingle
Talks have opened up between the federal and state governments about giving the states early access to a share of $20 billion of funds set aside for the National Disability Insurance Scheme, but there are concerns the states may have to cede control over the massive scheme in return.
The NDIS is expected to be discussed at the meeting of federal and state leaders in Sydney on Wednesday and Thursday, with the federal government proposing changes in the board of the National Disability Insurance Agency (which runs the NDIS) which the states believe may lead to them losing their right to nominate board members and, as a result, their say in how the scheme operates.
At the same time, it is understood Canberra has said it was open to discuss a push by some states – notably Queensland – for early access to funds raised by the federal government for the NDIS with the states collectively seeking several billion dollars of early funding.
The Gillard government oversaw an increase in the Medicare levy by half a percentage point from July 1 last year to 2 per cent with the extra revenue pledged to fund the NDIS raising around $3.3 billion in the first year, and $20.4 billion between 2014-2015 and 2018-2019, with 25 per cent earmarked for the states.
The money was only supposed to be drawn down from 2018.
But with some states under intense financial pressure, and the introduction of the scheme sped up in some places, there has been a push to release funds early to help them cover their disability costs.
It is understood there have been discussions about this possibility in recent days, though sources say the federal government is concerned that any drawdowns now would leave a hole in the state disability budget later as the disability fund effectively has a finite life.
But at the same time, the federal government is making renewed attempts to overhaul the current board of the NDIS – which contains key architects of the scheme – and replace them with appointments from ASX 50 companies.
Earlier this year, The Australian Financial Review reported that a brawl had erupted between the federal government and the states over a federal move to turn over at least half the board that oversees the NDIS.
Disability Minister Mitch Fifield argues the board should be appointed on the basis of financial skills while the states argue it should be a representative body that reflects their interests and those of different disability groups.
Senator Fifield argues the Disability Reform Council – which oversees the NDIS and includes state representatives – should be the representative body. Sources also say the NDIS legislation means there is no risk that the federal government can make any appointments to the board unilaterally and must consult the council.
It has emerged Senator Mitch Fifield commissioned corporate advisory firm Korda Mentha to review the skills and experience required by the NDIS board as it develops further from a body caring for 30,000 people to one looking after 460,000 and administering a $22 billion insurance-based scheme.
Korda Mentha has argued the next iteration of the board should have a strong ASX 50 or large government business enterprise-level experience in operational and financial systems and controls.
Victorian Disability Minister Martin Foley said on Monday the NDIS “is a joint Commonwealth-state agency as reflected in the 2013 intergovernmental agreement”.
“That agreement sets out terms of payment, and we would expect the Abbott government to honour all its funding commitments”, he said.
“This scheme has the potential to transform the lives of people with disabilities and should not be used to play politics.”