Wednesday, 27 November 2019
National Disability Insurance Scheme Amendment (Streamlined Governance) Bill 2019; Second Reading
I present the explanatory memorandum to this bill and move:
That this bill be now read a second time.
This bill amends the National Disability Insurance Scheme Act 2013 to introduce streamlined governance arrangements that will simplify rule-making and decision-making under the act.
The bill makes important provisions that will give the Commonwealth minister responsible for the National Disability Insurance Scheme increased certainty about timing of decisions under the act requiring state and territory agreement, including appointments and terminations to the board of the NDIA and the NDIS Independent Advisory Council and the making or amending of some of the NDIS rules. It includes provisions to ensure that information held by the NDIA and the NDIS commission can be obtained by the Royal Commission into Violence, Abuse, Neglect and Exploitation of People with Disability, or the disability royal commission. The bill also ensures that the states and territories will continue to have an essential and strong role in the stewardship scheme.
These administrative arrangements will ensure that the governance arrangements that underpin the NDIS are efficient and effective, building on the recommendations from an independent review of the act in 2015, the Productivity Commission inquiry into the costs of the NDIS in 2017 and intergovernmental agreements supported by the Council of Australian Governments.
The NDIS is one of the largest social and economic policy reforms in Australia's history.
The scheme is continuing to grow apace as it rolls out across the country. Over 310,000 Australians are currently receiving support through the NDIS, and around 114,000 of these people are receiving support for the very first time. The vision of the NDIS, to enable every Australian with a significant and permanent disability to access the reasonable and necessary support they need to participate fully in their communities, is progressively being realised.
Since 1 July this year, the NDIS has been available across the continent. The scheme will continue to grow at a rapid pace over the next few years, with around 500,000 participants estimated to benefit from the scheme over the next five years.
This government has been fully committed to the NDIS from day one. We are bringing forward this bill to establish streamlined governance arrangements to ensure that the governance structure that underpins the NDIS is effective, efficient and adaptive.
The NDIS is a significantly complex reform, with governance shared between the Commonwealth and state and territory governments. The current NDIS governance structure includes a legislative framework, the NDIA board, the NDIS Independent Advisory Council and the Council of Australian Governments Disability Reform Council. Each body plays an important role in ensuring the NDIS remains true to its objectives.
Under current legislative and governance settings, the states and territories have significant roles and responsibilities in NDIS policy and funding arrangements. Setting and amending NDIS rules and the giving of directions to the chief executive and NDIA board, as well as making appointments and terminations, generally requires unanimous agreement from all jurisdictions. This has resulted in a governance structure that is complex, with decision-making processes being more time-consuming and less efficient than required for such a significant reform.
Difficulties with the current governance arrangements have been consistently identified during the NDIS trial and transition periods. Past experiences of the requirement to obtain unanimous agreement from all states and territories has meant that NDIS rules, or amendments to rules, which have agreement at the officials' level have taken up to 10 months to be formally agreed before they could be registered.
Unnecessary delays in decision-making was recognised as a critical issue by the Productivity Commission in its 2017 review of NDIS costs. In the PC's final report, handed down in October 2017, while acknowledging the complexity of shared governance arrangements and the valuable knowledge and expertise of all governments for designing and refining the Scheme, the PC concluded:
… such timeframes could pose significant operational difficulties for the NDIA.
The shared governance arrangements requiring unanimous agreement from states and territories to progress a large range of critical issues is indeed cumbersome and complicated. This reduces the Commonwealth's ability to respond rapidly and flexibly to emerging issues.
This government, along with the states and territories, has therefore reached the view that better arrangements are required as the NDIS approaches full scheme. Changes will improve the effectiveness of governance arrangements to provide an agile and responsive legislative environment.
This is good news for Australians living with significant and permanent disability, their families and carers who are set to benefit from the NDIS. These changes will simplify what is a complicated and inefficient system of decision-making.
The changes proposed by this government include introducing a 28-day consultation process with state and territory disability ministers on matters under the NDIS Act that require agreement. If they do not respond after 28 days they will be taken to have agreed. All state and territory disability ministers have been consulted and have been voluntarily following the 28-day convention since November 2017. Formalising this commitment in law provides the right incentives for all governments to manage the NDIS efficiently.
The changes proposed by this government also establish arrangements with the Commonwealth minister to be able to appoint members to the NDIA board based on majority agreement of the states and territories, instead of under the current requirement for unanimous agreement.
The NDIA board is responsible for overseeing the implementation of the NDIS and its long-term sustainability. The board manages the financial and delivery risk of the scheme, including maintaining an actuarial and insurance approach to decision-making. The board develops the NDIA's business strategies, manages risks to the organisation and the NDIS and, through its CEO, handles the day-to-day management of the NDIA.
The NDIA board is a national board, not a representative board. Members are appointed to the board if they have the right skills and expertise to carefully mange the significant scale, cost and potential risk in delivering the NDIS—without regard to where they live.
Allowing the minister to appoint board members based on majority agreement will ensure that the best and majority-supported candidates are appointed in instances where there is not unanimous agreement.
The changes proposed by this government also establish arrangements for the Commonwealth minister to be able to appoint members to the NDIS Independent Advisory Council, based on consultation with states and territories.
The function of the advisory council is to provide the board with independent advice, which the board must consider when performing its duties, having regard to the role of families, carers and other significant persons in the lives of people with disability.
The changes proposed by this government also establish new arrangements for consultation with states and territories relating to any proposed changes to some NDIS rules—namely, those rules that relate to the payment of NDIS amounts and the NDIA CEO's power to disclose information. These are consequential amendments that will have no impact on the scheme's purpose or design, people's access to the NDIS, the determination of participants' reasonable and necessary supports or the content of their plans.
Finally, the changes proposed establish a clear authority for the disability royal commission to obtain information from the NDIA and the NDIS commission. This will help to ensure public confidence that the disability royal commission has the information it needs to do its job.
The NDIS and its beneficiaries deserve the best and most efficient governance arrangements possible. The changes proposed in this bill will help us deliver this world-leading reform.
The Morrison government is committed to working with states and territories and the NDIA to deliver a fully funded, high-quality NDIS. This bill represents a significant step forward, cutting red tape and ensuring governance arrangements for the NDIS enable responsive delivery and agile decision-making as we move into full scheme.
I commend this bill.
I rise to oppose the National Disability Insurance Scheme Amendment (Streamlined Governance) Bill 2019. With this bill the government is seeking a lower bar for the appointment of board members of the National Disability Insurance Agency. The current standard in legislation is that the Commonwealth and all states and territories support the appointment of a board member other than the chair. This bill seeks to lower that standard to a majority of the group. This is not the way forward for this important national scheme.
We've recently had research out of the University of Western Australia, a report called Six years and counting: the NDIS and the Australian disability services system, a white paper. The study draws on 63 reports on the NDIS written since 2013. Amongst its disturbing conclusions are as follows:
In one conclusion the report states:
Importantly, these are not simply "transition problems" or "risks that will be solved as markets adjust". The current state of the system is the new system. It is a system that only works for some service users and for some service providers. It is increasingly evident that it leaves major gaps in terms of responsibility allocation and funding capacity between state/territory and the Commonwealth governments in critical service areas such as housing, health, education and employment. It also leaves states and territories to pick up the bill when people with disability are diverted to other health and welfare systems due to supply breakdown.
Whilst this is a good study out of the University of Western Australia, nearly anyone with experience of the NDIS in 2019 can tell you it has some major problems. As Bob Dylan said, you don't need a weatherman to know which way the wind blows. We don't actually need a sixty-fourth academic study to tell us that the NDIS is not working anywhere near as it should be consistently for all people with disability in Australia. You only need to spend a little time talking and listening to people with a disability, their carers and loved ones to get a real sense of what's going on. Some success stories, but too many failures.