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Joint Standing Committee on the National Disability Insurance Scheme
19/06/2015

FIFIELD, Senator the Hon. Mitch, Assistant Minister for Social Services, Commonwealth Parliament

Committee met at 08:01

CHAIR ( Mr Brough ): The committee will now commence its public hearings on the National Disability Insurance Scheme. I welcome Senator the Hon. Mitch Fifield, the Assistant Minister for Social Services, to our first session. Information on parliamentary privilege and the protection of witnesses and evidence has been provided to you. I now invite you to make a short opening statement. At the conclusion of your remarks, I will invite members of the committee to put questions to you. Thank you very much for being here with us this morning on this bright and breezy Canberra Friday morning.

Senator Fifield: Great to be here. Could I thank colleagues for the work that they are doing on this committee, but also particularly the spirit in which I know this committee has been operating. Thank you, indeed.

Colleagues, you would all be well aware that we are at about 13,500 participants in the scheme thus far, with seven trial sites underway, and that we are currently in the middle of negotiations with the jurisdictions for the plans for rollout beyond the existing trial sites to cover full jurisdictions. We are in a position where we have about 85 per cent of the bilateral targets being met in terms of participant numbers, which is up on the previous quarter, which was about 81 per cent. We do have average package costs pretty much where they should be. They were a little on the high side in the first quarter of the scheme's existence, but the agency has put a heck of a lot of effort in. Average package costs are not the ultimate or the only measure in terms of the scheme's budget, but they are an important measure, and the scheme has done some good work there.

There have been some significant changes in approach, which I know you are aware of but which I will briefly mention, given this is my first occasion to appear before you. When the scheme was commencing, when the agency started operations, they had originally envisaged that they would have, at full rollout, a staffing level of about 10,000 people. They are now envisaging that that will be something a little above 2,000 people. That has reflected their desire to focus on what is the core business of the agency, which is the policy for the scheme, and also the assessments that are done. The agency is looking at outsourcing a range of activities that they might have initially considered doing in-house. I think there is an early guide for the agency in terms of the gateway services in Tasmania, which have always been provided by non-for-profit organisations. We think that is an important change to reflect.

Also the agency, again, was originally looking at being a builder of new properties—of new facilities—and often looking at purpose-built facilities around the country. Quite sensibly, I think the agency has recognised that in the form that they are, as an organisation that is starting up, that property skills and management of properties are not areas where they have particular expertise. The Department of Human Services does have a lot of expertise in that area; it has a large property footprint. And so the Department of Human Services is, in effect, going to be the property manager for the agency and, wherever possible, look to co-locate with the Department of Human Services. It is also very open to the possibility of co-locating with state agencies, where that makes sense. So, again, that is a bit of a different approach.

In terms of ICT: you would have seen that we announced $143 million in the budget for the full-scheme ICT arrangements. Again, we are going to rely on and draw on the expertise that the Department of Human Services has in that area as well. So it is part of recognising where there are skillsets elsewhere in the Commonwealth that we can draw upon, and the agency focusing on what their core business really is and where they have that expertise.

I mentioned that we are currently in the midst of negotiations for the bilaterals for full-scheme rollout, which the last COAG meeting said we should have done by August. So we are working hard on that. Obviously, we are looking very closely at the proposed transition plans to make sure they are compatible with sector readiness and agency capability.

Something that is in the forefront of my mind at the moment as we look to transition is the states and their level of service provision. It is important that the states maintain their efforts in areas beyond the trial sites. As you know, the states maintain their current responsibilities in areas beyond the trial sites. I cannot tell you—I have lost track—the number of people and organisations who have come through my door and who have said to me in relation to areas beyond trial site coverage that they have approached a state government department, or a state government, maybe in relation to seeking an individual support package. But they are told, 'Sorry, there's no money left. All of our jurisdiction's funds, all of our additional money, is going into the NDIS trial site.'

That is not acceptable. The states do maintain that responsibility and the state investment in the trial sites to date is not such that it should be having an impact on their capacity to service those people for whom they still have responsibility. Another example is the case of supported accommodation, where someone might go to a state government with a proposition for an area outside a trial site and it will be the same response that is given—that is, 'Sorry, we are putting all of our money into the NDIS, so we don't have money to do what is currently our responsibility.' That is leaving a false impression with people, that there are deteriorations in state service provision that are a function of the NDIS, and so the NDIS is being blamed for what people see as a lack of service in areas beyond trial sites.

Where those cases have been raised with me by individuals, I have written to state governments on their behalf. I spend a bit of time serving as an intermediary between individuals and state governments in relation to state government services, but it is something that I am going to keep an eye on. It is something I will continue to raise with the states. Not for one second do I want to suggest to the committee how it might undertake its business, but I do not think it would be an inappropriate thing for the committee to keep an eye on it as well!

It is also important as we move to full rollout that we make sure, area by area as the scheme rolls out, that the states do not prematurely withdraw services. That is a separate issue, which again I think we will need to keep a close eye on. When the NDIS was first conceived by the Productivity Commission everything was spoken about in terms of individual funding, which I think the scheme should always have as its prime delivery mechanism. But there has been a bit of an evolution over time as to where and when it might be appropriate for the agency to make a contribution in another way than through an individual. That is part of the concept of the ILC. I do think that we need to keep an open mind, particularly in remote areas and areas with a high Indigenous population, such as the Barkly, as to what might be better or different delivery models. A model that might work in metropolitan areas might not necessarily work in those areas. I think it is important for governments and for the agency to keep an open mind about what we might do, what flexibility there might be, in different areas.

Safeguards is also something that is clearly on our minds. There is the work that the DRC is undertaking for the safety and safeguards arrangements which will be in place for the full scheme. As you know, it is essentially the current state arrangements which are in place. There is some other good work happening which will feed into the DRC's work. The Senate committee which Senator Siewert initiated, the Victorian parliamentary inquiry and the Victorian Ombudsman's work will also be important inputs. I will share with the committee where some of my thinking is. It is by no means settled but I think it is worth looking at, for safeguards and safety arrangements, whether we build on existing Commonwealth arrangements. I will cite two examples. I do not have a fixed view on this; it is something for comment by the committee and more broadly as part of the consultations.

In terms of complaints arrangements we currently have the Aged Care Commissioner and the Aged Care Complaints Scheme. In the budget we announced that the Department of Social Services complaints scheme will be transferred to the auspices of the Aged Care Commissioner. In terms of a complaints mechanism, could we expand the role of the Aged Care Commissioner to cover the complaints element? Many of the state jurisdictions have state disability complaints commissioners. Obviously there will need to be a mechanism of that sort. Rather than establish a new identity, could we build upon the expertise that we currently have? For issues of provider accreditation in aged care we have the Aged Care Quality Agency. There is a skill set there. Again, I just put on the table for discussion—I have no firm or fixed views—whether it might be appropriate in some way to use that Commonwealth expertise. I think that with safety and safeguards there is no point in having anything other than an open and up-front discussion and looking at all of the options. As I said, I am in no way fixed—just recognising that there is some Commonwealth experience already in those two organisations that may be something that we can draw upon. Chair, I know time is short, so I will conclude my remarks and look forward to a discussion.

CHAIR: I appreciate it. I will let the committee ask questions and I will wrap it up at the end.

Ms MACKLIN: Thanks, Minister, for coming today. We appreciate it. I am sure Mal would agree that the committee does strongly endorse your remarks about making sure that the states maintain their effort and continue to provide the services that they are obligated to provide. It has been a big issue that has been raised with us, and we will certainly keep raising it with them in the forums that we have. What would be useful is if you could assure the committee that the Commonwealth will also be maintaining its effort in all of the areas that need to be maintained before all of the programs that are going to come into the NDIS come in. I know the Commonwealth has extended funding for personal helpers and mentors, and that is appreciated by all the people affected, but if you could assure people that the Commonwealth, too, will maintain its effort.

You raised other issues about support being provided to people via non-individual packages. I understand the points you are marking about remote areas. I am sure you are aware that some groups of people with disability are very concerned about how assisted technology is going to be provided. They are worried that individuals are not going to get assistance that meets their individual concerns, that it is going to be too much of a centralised approach. So, I will just put that before you.

The issues that I primarily wanted to raise are really to reassure everyone—and I know the government has been, so I am not trying to be difficult about this, and I understand how budgets are written. I know, through estimates, that you and Dr Hartland agreed to provide the forward estimates figures that show that the NDIS is fully funded through the forward estimates. I am just looking at table 9.2 in Budget Paper No. 1, which I think is the table that shows best of all that that is the case. Of course, that only takes us through the projections until 2018-19. I assume you could tell me, if I am right, that the government is still proceeding with all the agreements with the states and territories—except WA; I understand they are in a different category—to the originally agreed timetable. Could you confirm that this is the case? Tell me if I am wrong; it seems to me that table 9.2 is the correct table. If you could show this table right through to the full rollout, that would reassure everyone that we as a committee are speaking to that the funding into the out years, right to the full rollout, is in the budget.

Senator Fifield: Just quickly, going through the issues, as you are aware, about 17 different Commonwealth programs are folding into the NDIS. We are very alive to the need to make sure that people have continuity of support, and that there may be some people who are receiving supports in particular programs who may not be eligible as NDIS participants. So we are looking to see where there is a need for the Commonwealth to continue a program separate to what is folding into the NDIS.

Ms MACKLIN: So, lower level mental health services, for example?

Senator Fifield: That is right. We are working those through. It is not always straightforward to get a handle on whether people will or will not need continuing support separately. So, rest assured we are aware of that issue and are working through it program by program. In terms of assisted technologies—

Ms MACKLIN: Just before we go off that: the maintenance of Commonwealth effort on the programs that will come into the NDIS?

Senator Fifield: Sorry, yes, absolutely. There will absolutely be the maintenance of Commonwealth effort on programs going into the NDIS.

CHAIR: I think what the department told us previously and you are just reiterating here, is that initially when you were folding in-kind into the program you were taking it as the whole lot of that part of the program. It is now recognised that there is always a legacy.

Senator Fifield: There is.

Ms MACKLIN: No, I accept that.

CHAIR: I was just confirming that that was right. There was a change of thinking along the way which is involved.

Senator Fifield: Yes, that is right. In terms of assistive technologies and other equipment: the agency has a had a discussion paper out there and I am aware of the range of views. It is something where we have to get the balance right between making sure that individuals do have the right to choose the sort of stuff that they want and where it could make sense for there to be some other bulk purchasing. It is something that the agency is having a look at. My default is towards the individual. The agency has not landed on a position, but it is an area that I am going to have an involvement with.

Ms MACKLIN: You might add our concerns!

Senator Fifield: Yes, absolutely!

Ms HALL: Could I add that it is absolutely imperative that there is individual flexibility? A person might have the exactly the same disability as another but just the tiniest bit of difference means that they need a different type of aid. It really is important that you get that right.

Senator Fifield: I hear you, and I am on the same page.

In terms of the agreed timetable for the scheme: we have not altered the agreed timetable, but we are working to the timetable as laid out in the intergovernmental agreements.

Ms MACKLIN: And no state or territory is trying to, leaving aside WA?

Senator Fifield: No state or territory is trying to change?

Ms MACKLIN: Or territory?

Senator Fifield: Well—

CHAIR: Do not be too pointed.

Ms MACKLIN: Given that there is only one that it might apply to, I will come to them!

Senator Fifield: Obviously, I read things in the newspapers as well. But we have not received a formal proposition from the Northern Territory to alter arrangements.

CHAIR: Is it fair to say that at this point the Northern Territory is still negotiating in good faith and you have every expectation that they will continue to participate, as they said they would at the start—officially?

Senator Fifield: Correct. My officials are still negotiating with the Northern Territory

CHAIR: We can take that as—

Senator Fifield: as per the original plan.

Ms MACKLIN: But, from the Commonwealth's perspective and from the Commonwealth budget's perspective, the end point is the same, and you would be able to produce a table that reassures people with disability that that money is in the budget as originally planned?

Senator Fifield: Yes, we have not changed the funding profile for the NDIS. I am very happy to produce a table.

CHAIR: You would not be able to produce a table showing where the income is coming from in the outyears, would you?

Ms MACKLIN: Should be able to.

CHAIR: Sorry, not the outyears, beyond the outyears—beyond the forward estimates. My understanding is that we are still seeking answers to how we are going to fund that—unless it comes out of consolidated revenue or debt or whatever? But what I am saying is that it is not like the Medicare co-payment, where it is a proportion of it but we all know it is not all of it.

Senator Fifield: In a nutshell: of the $22 billion for rollout, $10 billion will come from the states. And just to complicate things, about $3 billion of that comes from the DisabilityCare Australia Fund to the states. That is part of their $10 billion. So about $10 billion is from the states, $3 billion is money that the Commonwealth would have spent anyway, in the absence of the NDIS. There is $9 billion of additional Commonwealth investment.

Ms MACKLIN: Per annum?

Senator Fifield: Per annum. That is right. I am talking per annum figures here. The DisabilityCare Australia Fund, the Medicare proceeds, covers the Commonwealth's additional contribution, up to and including 2017-18. There is a slight gap in 2018-19 between the Commonwealth's additional contribution and what the DCAF funds cover. From 2019-20 on, the DisabilityCare Australia funds cover about 38 per cent of the Commonwealth's additional contribution.

Ms MACKLIN: What is clear, from this table, is the government is projecting that that is funded in the budget.

Senator Fifield: It is factored into the budget.

Ms MACKLIN: I think that is the important point.

CHAIR: My slightly different point is that it is factored into the budget and is taken into account, therefore it is in our overall projections. It is just that the government has to make decisions as to whether that comes out of consolidated revenue or that it is a special measure, and those decisions have not yet been looked at yet, I presume.

Senator Fifield: That is correct, but it is factored in.

Ms MACKLIN: Would you be able to produce a table that takes us out to the final year of the rollout? The table here only takes us to 2018-19.

Senator Fifield: We can certainly do that.

Ms MACKLIN: You would have seen the commentary we have seen and I think it would reassure people. I am not suggesting it is otherwise. We do not have a table—I do not think there is a table, is there? Is there a table other than this that shows it somewhere?

Senator Fifield: I do not think there has been a convenient table in any budget paper since the establishment of the NDIS. I remember, in previous incarnations, constructing my own—

Ms MACKLIN: That is why I am suggesting it might be helpful.

Senator Fifield: I think it would be helpful to do. We can certainly do that.

CHAIR: Are you done, Jenny?

Ms MACKLIN: The only other thing is the Northern Territory. As you know, we are going to the territory, and like you we have seen the comments and I understand from the public comments you have made that you are obviously committed to a national scheme. If you had any suggestions about how we could help, you might want to do that separately.

CHAIR: You might want to do that another time.

Senator Fifield: Yes, we can do that offline. I know one of the issues raised by the territory has been whether all of those people that they thought would be within the scheme are within the scheme. The agency has been working through individual cases to see if there are reasons in the assessment as to why people were deemed to be not eligible and whether they, in fact, should have eligible. The agency is working through those, case by case, and that is information that we will obviously be sharing with the territory. As you know, that is the purpose of the Barkly trial. That is why it was chosen. We all collectively knew that it would be a challenging environment. We expected challenges and we have to work through them.

Ms MACKLIN: And Western Australia?

Senator Fifield: In Western Australia, we have the NDIS trial and the My Way trial. The agreement is that we have an evaluation of those and that is the intention.

Ms MACKLIN: The problem seems to be—and I am not blaming you for this, at all—that we have the evaluation finishing after the time that we should all be trying to get a new agreement. I cannot quite see how we are going to get to a position where we learn from the evaluation, where the evaluation actually guides a decision. How do you see that happening, given the disconnect?

Senator Fifield: I think Western Australia is open to discussion before the evaluation is completed.

Senator SIEWERT: I go to housing. To say that it is confusing to the community is a significant understatement. Where are we up to and what is the time line? To cross committee issues here, we have just received an answer back from the department that was, quite frankly, insulting to the committee, in terms of telling us what was going on.

Senator Fifield: I have not seen it.

Senator SIEWERT: It said, basically, 'Wait until September to find out what is going on.' That is very late in the piece, and we are getting conflicting answers from the NDIA and the department about what is going on with housing. Where are we at? Is the time line September? That is just remarkable.

Senator Fifield: Let me start at first principles and work from there. Yes, the NDIS will have an important role in specialist disability housing. We are determined to make sure that the NDIS's effort in this area does not allow the states to withdraw from what will be their ongoing responsibility for mainstream and social housing.

CHAIR: Can you tell us how you are going to achieve that or how you hope to achieve that.

Senator Fifield: Sure, I will do that. The states will have ongoing responsibility for mainstream social public housing. NDIS's focus will be in specialist disability housing. There are essentially two housing streams in the state jurisdictions: there are the dollars which flow through their public housing and there are the dollars that flow through disability housing. So the dollars that flow through public housing, social housing, they will continue to have responsibility for. The NDIS in effect, I guess, stands in the stead of the specialist disability housing dollars that currently flow through state disability departments. The Productivity Commission report spoke of a figure of something like $500-odd million in the scheme in relation to housing. We have heard the figure of $700 million.

Senator SIEWERT: That is the figure that is commonly —

Senator Fifield: Essentially, if you indexed that $500 million figure from when the PC did their work forward, you get to a figure of $700 million. That $700 million figure is the aggregated components of capital, much of which would be attached to the packages of an individual. A large amount of that is money that will be attached to the packages of individuals who are currently receiving housing support—specialist disability housing supports. In what the agency is working through at the moment, there are a couple of things. One is: what is the amount of money that will be available at full scheme for the agency to invest in creating new specialist disability housing stock? The other is: what will be the dollars along the way in the lead-up to full scheme that will be available? Obviously, the money that will be available will be more at full scheme than in transition, and it will be a much smaller amount again in the existing trial site phase. So that is one thing they have to work out.

The other thing they have to work out is: what will be the mechanism for determining projects that the NDIS will have an involvement in? What I envisage is that there will be organisations who will have specialist disability housing propositions that they will bring forward to the agency—organisations who might have some land or even a bit of capital—and the agency can leverage off the contribution that organisations bring for specialist disability housing propositions. What the agency has to work out is: what are the dollars available that will not be attached to an individual's package and that they can use in that way to stimulate the supply of specialist disability accommodation, and what is the mechanism for doing that? In the department's answer, when they are referring to September, they are probably referring to work reporting back to the Disability Reform Council.

Senator SIEWERT: You are looking at allocating proportions of that, say, $700 million. Is that still the level that you are working on?

Senator Fifield: It is a—

CHAIR: If we call it $500 million to $700 million, would you be comfortable with that?

Senator Fifield: Yes, as long as it does not imply—which I think has been part of the public confusion—that there is a stand-alone annual pot of housing funding that can in total—

Senator SIEWERT: This is what is in fact out there.

CHAIR: Let us drill into that a little more from Rachel's perspective, because it is a really key point for us when we are articulating all the rest of it too. It is not decided yet, is it—that is the bottom line? It is still in a state of flux, and you hope that they will come in September to COAG with position papers that are then agreed to say, I presume—correct me if I am wrong—something like, 'We see x per cent being attached directly to individual packages for modifications et cetera and this percentage potentially being in a pot that can be used for things like innovative housing, and that sort of thing.' It is something like that?

Senator Fifield: That is right. The thing to factor in, and the thing that has been lost in the public discussion, is that the conceptualisation of a $700 million annual pot of money that can be put in total towards housing disregards the fact that there are currently people in specialist disability accommodation for whom their providers would want a component of capital attached to their package. That is something that really has been lost in the public discussion. There never was going to be a separate, discrete $700 million housing fund. Answering the chair's question as to how we are going to make sure that we do not supplant the states' mainstream social housing responsibility, it is by being very careful and very clear about the circumstances in which the agency will partner with other organisations and by making it clear—committee members would know this—that it never was the intention, and it will not be the case, that the NDIA will become a ninth public housing authority. It will not be a builder and it will not be an owner of accommodation. It will look at propositions, proposals for where the agency dollars can leverage off what other organisations can bring to the table.

Senator SIEWERT: I want to be clear—is the figure of around $700 million the funding that is on the table? You say there is not a discrete amount of money but that is what is understood out there.

Senator Fifield: That $700 million figure is an extrapolation of the $500-odd million figure that was in the PC report.

Ms MACKLIN: Is it still the figure that is projected to be spent on housing related assistance?

Senator Fifield: In one form or another, yes.

CHAIR: To be even more precise, would you be more comfortable in saying that, whilst you might hope that that is the case, it will be decided by COAG and there will be some sort of definitive position going forward from September, hopefully agreed, that this is the sort of money, and it may differ from that? I am not saying that that is what we want; I am just trying to get to where we are likely to be.

Ms MACKLIN: It is not really a COAG matter, is it?

Senator Fifield: Sorry—the COAG Disability Reform Council.

CHAIR: I am just truncating. Taking Rachel's point, I think we are all hearing $700 million. But the reality is that you are dealing with the states and they have not actually agreed with that at this point in toto.

Senator Fifield: It does not formally need their agreement. That money is in the budget. It is part of the NDIS budget. There is no less money in the scheme. This is money that is in the scheme and always was going to be in the scheme. The only question—

Ms MACKLIN: This is really important for all of us to get out—

Senator Fifield: That is right. At the last COAG Disability Reform Council meeting, when I was explaining this—which was not the first time that I had taken the Disability Reform Council through this—there were some who said, 'Oh, that means money is being taken from the scheme.' I said, 'No. Not a dollar is being taken from the scheme. The money is there. The money always was there.' The only issue is that there has been a misconception about the flexibility for the agency to deploy those funds. A big chunk of those funds will be attached to individuals. There never was, within the agency and within the budget, a separate $700 million fund as such. That $700 million is the aggregation of the various contributions that the agency will make, in different forms, to housing.

Senator SIEWERT: That is why I am struggling with saying that it may be $700 million or it may not.

Senator Fifield: When people have heard the figure $700 million, some have thought it means that there will be $700 million which will be divided on a per capita basis by the states and each state will receive a cheque which they can then spend on housing. That is what a lot of people have thought. Others have thought a step back from that, that there is a $700 million fund all of which will be spent on new housing projects. And neither of those two things is correct.

Ms HALL: Does money for modifications come out of that $700 million as well, or is that just for—

Senator Fifield: Mods is separate.

Ms HALL: It is separate. That is all the clarification I wanted.

CHAIR: I like to talk in a practical sense. You say that the money that is attached to an individual is part of that. Can you give us an example of the capital funding? What sorts of examples would there be? For an existing—

Senator SIEWERT: Individual capital? That is what I am struggling with.

CHAIR: Yes.

Senator Fifield: You have someone's package costs which cover their recurrent needs. In addition to that, there may be a capital component attached to it in recognition of the fact that they live in specialist disability accommodation that may be more expensive to build and maintain than other accommodation and that therefore there is a capital—

Senator SIEWERT: So you get a component for specialist housing and you put that into the pot if you are building a group home, for example—the example is four people who get together and build something. Is that what you are talking about? When they are getting it with their individual package, it is actually not for modifications?

Senator Fifield: No. Modifications are separate.

Senator SIEWERT: It is only for builds if—you also made the point that if you are in existing supported accommodation people expect a capital component. Can we tease—

Senator Fifield: Yes. You might be in existing specialist disability accommodation which will over time need to be rebuilt or refurbished, so there would be a capital component in recognition of that.

CHAIR: It is almost a depreciation-style thing stuck in there so it can maintain a standard for them—

Senator Fifield: That is right.

CHAIR: and for that other group. This is really interesting, because we all get this in our electorates as well. If I am looking at doing some sort of property and, as in the examples you used earlier, I have the land et cetera and there are four people and they have all of the supports they need, is there then potential for them to have a capital component annually built in because their needs are so great that the capital-intensive nature of their living accommodation would warrant that, and that could be an offsetting factor so that the service providers know they can service loans or whatever with it?

Senator Fifield: That is exactly right.

CHAIR: I have never been able to get that clear.

Ms MACKLIN: That is as I have always understood it but the critical point is that—and I think this where Rachel's and the committee's frustration is—as you know, there was supposed to be a policy paper. It has not emerged and that is what is frustrating. This could all be explained—not only how the agency and you, through the disability ministers, will maintain the effort and protect the investment going into disability housing from the states but also how we leverage private investment. There are plenty of families who want to continue to contribute to the housing of their sons or daughters, and of course we all want to see that happen. So when will we see this policy paper that, frankly, we have all been promised for a very long time?

Senator Fifield: It will not surprise you that one of the issues has been a difficulty in getting the jurisdictions to agree on the content. What might be helpful is to have a short public paper that outlines the Commonwealth's view and the principles.

CHAIR: What you have just articulated here I think we would all agree with: your statement of what those components are, what is there et cetera. It would only be a couple of pages but I think it is essential.

Senator SIEWERT: How soon, then, are you expecting that?

Ms MACKLIN: But we have to get this leverage point right too.

CHAIR: Yes, that is a big part of it.

Ms MACKLIN: The point of the $700 million is to do what you said but it is also to help leverage other investments. How that is going to happen has never been resolved, to my understanding. It would be very helpful to have that aired and discussed.

Senator SIEWERT: I understand the issue you mentioned about jurisdictions, but how soon is the Commonwealth paper?

Senator Fifield: As I said, I think it would be helpful if we issued a Commonwealth paper. I have always been clear as to what the role of the agency is. Other jurisdictions have not been. That has been one of the challenges in terms of having an agreed paper. But I think there would be benefit, as the chair suggested, in having a short Commonwealth paper that could fill that information gap.

Senator SIEWERT: You did not answer about the timing of the Commonwealth paper.

Senator Fifield: I think we could do that before September. It may just be something in my name. That might be the more straightforward thing.

Senator SIEWERT: I understand what you are saying.

CHAIR: That would still be very welcome.

Senator SIEWERT: And it would be very helpful.

Dr GILLESPIE: Minister, do you have any opinion on or projections of the workforce development that will be required when the whole system is more individualised rather than clustered? If, going forward, rather than having big group homes there are more individual packages, how do you see the sector providing the workforce that will inevitably have to be exponentially larger because they will be at disparate locations? Do you think it is developing satisfactorily?

Senator Fifield: There is a workforce strategy which will be released later this year. The disability workforce has to effectively double for the full scheme. But the disability workforce has almost doubled over similar periods of time in the past. The number of participants in the NDIS will be a 30 per cent increase on the number of people who are currently serviced by the state arrangements. Obviously there will be existing participants who are having higher levels of service and better levels of service. We already have quite a mature disability sector in terms of service providers. Yes it will be a challenge for the providers to grow but I do not think it is too much of a stretch. That is something we will have to monitor. That is where the interim pricing regime which is in place at the moment is important, because you would not want to have demand increase at a rate that outstrips the supply of services. If you did, we all know that what happens is that the price of the service providers would go up and would eat into people's packages. That is where careful consideration will need to be given as to how long the agency's interim pricing arrangements are in place.

Dr GILLESPIE: You have mentioned that you are happy with the average package price. Could you remind us what that is at the moment.

Senator Fifield: Yes, it is now around $36,000—average package costs. Early in the life of the scheme it was about $45,000. Obviously that is partly a function in the first quarter of, in a very small cohort, a reflection of the characteristics of some of the people who came in but it also, I think, in that first quarter, reflected an approach of the agency where to some extent the agency was giving individuals a list of funded supports and people were, not unreasonably, ticking everything. The planning conversations evolved to what they were always intended to be, which was, 'What are mainstream services that you should be connecting with that you are not? How can we help you connect with those? What are the natural supports in your life? How can we reinforce those? What are your goals? What are your plans?' and then looking at how funded supports can help people achieve those. So it was a more sophisticated conversation than perhaps there was in the very early days of the scheme.

Dr GILLESPIE: Are you happy that the engagement with existing tier 2 services is satisfactory and is not vanishing before our eyes or anything like that, because of uncertainty about how the system works or will work?

Senator Fifield: There is a lot of work going on about mapping exactly what the parameters of tier 2 will be in the scheme, and that is something that will evolve over time. But you are right. Some of the existing tier 2 services are currently provided by the Commonwealth and some are currently provided by the states. We will not be prematurely vacating those for which the Commonwealth is responsible, but we do have to make sure that the states do not.

CHAIR: So tier 2 that ends up outside of the NDIA is not you?

Senator Fifield: Tier 2 essentially has been renamed ILC, for information, linkages and capacity building. The services under the auspices of the NDIA are those services that are not delivered in an individual funding mechanism.

CHAIR: This has been evolving, we believe. In the original agreements, those issues were not decided. I know at one point the agency said they feel they could do it within their financial cap that they already have.

Senator Fifield: Yes.

CHAIR: Is that where we have arrived at?

Senator Fifield: Yes.

CHAIR: We heard early last year that South Australia intended to keep playing in that field, and we know New South Wales has been very vocal in saying they are not. Do you see those gaps being filled by the agency?

Senator Fifield: That is the intention—that the agency provide those. If a particular jurisdiction wants to maintain a contribution then that is good.

CHAIR: Good luck to them. Well done.

Ms MACKLIN: On employment, I thought it would be useful for us to hear your thinking about how you see, once we get into the transition phase, that there will be new ways of doing things between the NDIS, ADEs and the Disability Employment Services. How will people be able to access individual choice, taking their entitlements, if you like, from the Disability Employment Services and ADEs to meet their employment aspirations?

Senator Fifield: The starting point for me is, although the NDIS is not an employment program as such, there will be something really wrong if in design of the scheme we are spending $22 billion a year and we are not seeing an improvement in employment outcomes for people with a disability. If only by virtue of the fact that someone who is an NDIS participant is getting the daily living supports that they need, that should put a lot of people in a much better position in the first place to consider employment. If you are getting personal attendant care at a time in the morning that lets you get out and about, potentially to a job in good time, that is just one example of assistive technologies. It is at that most fundamental level: people getting the daily living supports that they need.

The second thing is the planning conversation that people have. Employment should be at the heart of that planning conversation. What we also need to do is to recraft the DES, and we have the—

Ms MACKLIN: So how is that thinking happening?

Senator Fifield: We have the opportunity with the expiry of the DES contracts in March 2018 to recraft the DES. We have extensive engagement with providers and people with disabilities which commenced about three weeks ago on what a new, post-2018 DES model might be like. I am very keen for it to have a component where some of the current $1 billion a year that we spend on the DES, or a component of that, might attach to the individual. An individual can get to direct that in a way that they think improves their employability, which would allow the DES, for those people—and I think it is 20 or 30 per cent of DES participants—

Ms MACKLIN: For example, as part of your NDIS package?

Senator Fifield: It might sit in parallel. I think there are 20 or 30 per cent of DES participants who will also be NDIS participants, so we have to make sure that the DES supports and services people—

Senator SIEWERT: It is too wide when you take out that component?

Senator Fifield: Correct. That is what I see. There will be some things that the NDIS appropriately does to help someone's employability, which may be as simple as the daily living supports that they get. There may be some additional things on top of that which may not be specifically intended to improve their employability, but it is a by-product. Then you will have the DES supports that someone has, a component of which I think should be attached to them as an individual, so that you can put those two things together—

Ms MACKLIN: When do you think we will see the policy thinking around this? Who is doing that?

Senator Fifield: The Department of Social Services. As you would know, the DES was transferred from the Employment portfolio to the Social Services portfolio. The reason I put to the Prime Minister that that happen was precisely so we would have a much greater capacity to bring the NDIS and the DES together. There are consultations happening now and there will be discussion papers issued later in the year. March 2018 seems a little way off, but we need to be making decisions in the near future to set things up for then.

Ms MACKLIN: Because the tender arrangements obviously will be different?

Senator Fifield: That is right. There is a lot of work to do, but there is a really good opportunity to bring those two elements together.

Ms MACKLIN: We will see something this year?

Senator Fifield: Yes.

Ms HALL: One little concern I have is around rehabilitation. It falls through the cracks everywhere now. Could you comment on that?

Senator Fifield: It all depends how rehabilitation is defined—

Ms HALL: Yes.

Senator Fifield: What people tend to mean when they talk about rehabilitation are those things which are the responsibility of the hospital systems and the health systems in the states. The tricky issue is once someone is stabilised. So there are supports that are appropriate for the agency to provide once someone is stabilised, but we have to make sure we do not have a gap—that we do not have a disagreement—about where the state health responsibility ends and where the NDIA responsibility starts.

Ms HALL: Is there work being done in that space?

Senator Fifield: There is. The community affairs committee is looking at the issue of young people in nursing homes, and there are some issues that have started to emerge from that where there have been some gaps. That is where the work of the community affairs committee is very helpful.

CHAIR: We will leave it there. We very much appreciate your generosity with your time today. Your advice to the committee and conversation with us has been very insightful and worthwhile. I appreciate it is a very big task and that there are some big decisions to be made in the near future. The committee remains committed in a bipartisan fashion to continue to work with all parties to make this the best we possibly can. Thank you very much.