discussion paper act...agreed that ernst & young (ey) conduct the review. the purpose of the...

Discussion PaperIndependent Review of the Operationof the National Disability InsuranceScheme Act 2013 (Cth)

September 2015

Review of the Operation of the NDIS Act – September 2015 EY | i

Table of contents1. Introduction ........................................................................................................12. Objects and principles ..........................................................................................33. Design of the legislative framework .......................................................................44. Becoming a participant.........................................................................................55. Participant plans ..................................................................................................76. Registered providers of supports ..........................................................................97. Nominees ......................................................................................................... 118. Reviewable decisions ......................................................................................... 159. Compensation and debt recovery ....................................................................... 1610. Governance ...................................................................................................... 1711. Other matters ................................................................................................... 20Appendix A Review Terms of Reference .................................................................. 21Appendix B Objects and principles of the NDIS Act .................................................. 22

Review of the Operation of the NDIS Act – September 2015 EY | 1

1. Introduction

1.1 Background and contextThe Australian Government has commissioned an independent review of the NationalDisability Insurance Scheme Act 2013 (Cth) (NDIS Act), as required under Section 208 ofthe NDIS Act. In accordance with this legislative requirement, Disability Ministers haveagreed that Ernst & Young (EY) conduct the review.

The purpose of the review is to assess the operation of the legislative framework(comprising the NDIS Act and the NDIS Rules) and develop recommendations as to whetherany improvements can be made to better support the objectives and principles of theNDIS Act. Appendix A outlines the Terms of Reference for the review.

It is important to note that the review:

► Is not intended to evaluate the performance of either the National Disability InsuranceScheme (NDIS) or the National Disability Insurance Agency (NDIA). Though the reviewwill consider aspects of the NDIS and NDIA to the extent that they directly relate to, orare impacted by, the legislative framework.

► Is one of many public review processes that will allow stakeholders to comment on keyaspects of the NDIS. Other notable reviews that are planned or ongoing include theProductivity Commission’s Review of Scheme Costs, the Review of theIntergovernmental Agreement and the Evaluation of the Trial of the NDIS.

1.2 Purpose and scope of this Discussion PaperStakeholder engagement will be central to the review process. EY will rely on stakeholderfeedback to inform its findings and recommendations.

This Discussion Paper forms a key component of EY’s engagement with stakeholders. Itspurpose is to prompt feedback from stakeholders (through written submissions) on the keyquestions that the review is seeking to address.

The Discussion Paper is structured thematically; covering the key elements of legislativeframework. The final section of the document provides stakeholders the opportunity toraise issues in relation to the operation of the NDIS Act that are not covered in thisDiscussion Paper.

1.3 Making a submission to this Discussion PaperIt is not expected that all stakeholders should answer all questions. Stakeholders areencouraged to answer those questions they feel are most relevant to them. Stakeholdersare also welcome to provide feedback on areas relating to the NDIS legislative frameworkthat are not covered by this Discussion Paper.


Written submissions to this Discussion Paper are sought by 9 October 2015. Submissionscan either be emailed to [email protected] or posted to the following address:

Review of the NDIS ActErnst & YoungGPO Box 281Canberra ACT 2601

1.4 ConsentBy providing a submission in response to this Discussion Paper you are consenting to thefollowing terms. The information contained in your submission will be provided by EY to theAustralian Government (Department of Social Services) in accordance with the terms of ourengagement. The submission may also be made available to the public, unless youexpressly state that certain information is confidential. You retain all intellectual propertyrights in your submission, but you grant to EY and DSS a royalty-free, perpetual andirrevocable licence to use, copy, reproduce, adapt and modify your submission for anypurpose relating to the review of the NDIS Act. If your submission contains personalinformation, we will comply with our obligations under the Privacy Act 1988 (Cth). A copyof our Privacy Policy Statement is available at www.ey.com.au.

mailto:[email protected]

http://www.ey.com.au/


2. Objects and principlesChapter 1 (pt 2) sets out the objects and principles of the NDIS Act. Key among the objectsof the NDIS Act (which are listed in full in Appendix B) are:

► To give effect to Australia’s obligations under the Convention on the Rights of Personswith Disabilities done at New York on 13 December 2006 ([2008] ATS 12)

► To provide for the NDIS in Australia

► To support the independence and social and economic participation of people withdisability

► To provide reasonable and necessary supports, including early intervention supports,for participants in the NDIS launch

► To enable people with disability to exercise choice and control in the pursuit of theirgoals and the planning and delivery of their supports

► To facilitate the development of a nationally consistent approach to the access to, andthe planning and funding of, supports for people with disability

Key among the principles of the NDIS Act (which are listed in full in Appendix B) are:

► People with disability have the same right as other members of Australian society torealise their potential for physical, social, emotional and intellectual development.

► People with disability and their families and carers should have certainty that peoplewith disability will receive the care and support they need over their lifetime.

► People with disability should be supported to participate in and contribute to social andeconomic life to the extent of their ability.

► People with disability should be supported to exercise choice, including in relation totaking reasonable risks, in the pursuit of their goals and the planning and delivery oftheir supports.

► People with disability have the same right as other members of Australian society to beable to determine their own best interests, including the right to exercise choice andcontrol, and to engage as equal partners in decisions that will affect their lives, to thefull extent of their capacity.

► The role of families, carers and other significant persons in the lives of people withdisability is to be acknowledged and respected.

Questions for stakeholders1. Do the Objects and Principles of the NDIS Act provide a sufficient basis for giving effect

to Australia’s obligations under the Convention on the Rights of Persons withDisabilities?


3. Design of the legislative frameworkThe NDIS Act is the legislation which establishes the NDIS and the National DisabilityInsurance Scheme Launch Transition Agency (known as the NDIA).

The NDIS Act is relatively non-prescriptive and principles-based. For instance, a key objectof the NDIS Act is that participants are provided ‘reasonable and necessary supports’. TheNDIS Act does not prescribe the types of supports that would be considered ‘reasonableand necessary’ across all participants. Rather, it outlines the broad criteria that the NDIAshould apply in determining what constitutes ‘reasonable and necessary supports’ in thecontext of individual participants.

Under the NDIS Act, the Commonwealth Minister may make NDIS Rules.1 These set out themore detailed operation of the NDIS. For instance, the Supports for Participants Rulesprovide greater detail on the ‘assessment and determination of the reasonable andnecessary supports that will be funded and the general supports that will be provided forparticipants under the NDIS.’2 The NDIS Rules have the same legal force as the NDIS Act.While the NDIS Rules are not passed directly by both Houses of the CommonwealthParliament, either House can disallow (or veto) them. There are currently 18 NDIS Rules.3

The legislative framework of the NDIS was initially designed to balance the need to enshrineaccountability mechanisms and protections in primary legislation, while giving governmentsufficient flexibility to develop and amend operational aspects of the NDIS (recognising theunique, evolving and complex nature of the Scheme).

The NDIA publishes Operational Guidelines. These are based on the NDIA’s interpretation ofthe NDIS Act and NDIS Rules, and are intended ‘to assist the NDIA perform or exercise itsfunctions or powers in making decisions or recommendations affecting members of thepublic.’4 As interpretations of the legislative framework, the Operational Guidelines do nothave legal force. Consequently, they do not fall within the scope of this review.

Questions for stakeholders2. Does the design of the legislative framework (i.e., high level primary legislation

supported by detailed NDIS Rules) enable government to further the objects andprinciples of the NDIS Act?

1 Section 209 of the NDIS Act sets out the process by which the Commonwealth Minister may makeNDIS Rules. This process (including the level of State and Territory approval required) variesdepending on the section of the NDIS Act to which a NDIS Rule applies.2 National Disability Insurance Scheme (Supports for Participants) Rules 2013.3 A list of the NDIS Rules can be accessed via ComLaw at:https://www.comlaw.gov.au/Series/C2013A00020/Enables.4 NDIA (2015), ‘Operational Guidelines’, available at: http://www.ndis.gov.au/about-us/operational-guidelines.

https://www.comlaw.gov.au/Series/C2013A00020/Enables

http://www.ndis.gov.au/about-us/operational-guidelines


4. Becoming a participantTo become a participant of the NDIS, a person may make an access request to the NDIA. Onreceiving an access request, the NDIA will then determine whether the person meetscertain access criteria. These criteria include the age requirements, residence requirementsand either the disability requirements or early intervention requirements outlined in Table1.

Table 1: Summary of the access criteria

Category Access criteria

Agerequirements

► Aged under 65 when the request is made► Note: Currently there are further age restrictions in certain

jurisdictions until scheme is rolled out completely

ResidenceRequirements

► Reside in Australia► Be an Australian citizen or hold a permanent visa or a protected

special category visa► Satisfy other requirements that are prescribed by relevant NDIS

Rules

Disabilityrequirements

► The person has a disability that is attributable to one or moreintellectual, cognitive, neurological, sensory or physical impairmentsor to one or more impairments attributable to a psychiatriccondition.

► The impairment or impairments are, or are likely to be, permanent.► The impairment or impairments result in substantially reduced

functional capacity to undertake, or psychosocial functioning inundertaking, one or more of the following activities: communication;social interaction; learning; mobility; self-care; self-management.

► The impairment or impairments affect the person’s capacity forsocial or economic participation.

► The person is likely to require support under the NDIS for theperson’s lifetime.


Category Access criteria

Earlyinterventionrequirements

► The person has one or more identified intellectual, cognitive,neurological, sensory or physical impairments that are, or are likelyto be, permanent; or has one or more identified impairments that areattributable to a psychiatric condition and are, or are likely to be,permanent; or is a child who has developmental delay.

► The CEO is satisfied that provision of early intervention supports forthe person is likely to benefit the person by reducing the person’sfuture needs for supports in relation to disability.

► The CEO is satisfied that provision of early intervention supports forthe person is likely to benefit the person by: mitigating or alleviatingthe impact of the person’s impairment upon the functional capacityof the person to undertake communication, social interaction,learning, mobility, self-care or self-management; preventing thedeterioration of such functional capacity; improving such functionalcapacity; or strengthening the sustainability of informal supportsavailable to the person, including through building the capacity of theperson’s carer.

► The early intervention support for the person is most appropriatelyfunded through the NDIS.

Source: NDIS Act ss 21-25.

Some concerns have been publicly raised about the NDIS access criteria. These include:

► The access criteria (particularly the concepts of permanence [s.24(1)(b)] and that earlyintervention will reduce a person’s future needs for supports [s.25(1)(b)]) are seen bysome stakeholders as not reflecting the real life experiences of mental illness or therecovery-oriented approaches of the mental health sector.

► The disability requirement that a ‘person is likely to require support under the NDIS forthe person’s lifetime’ [s.24(1)(e)] is seen by some stakeholders as having questionableutility, given that an individual can be a participant of the NDIS without receivingsupports funded by the NDIS.

Questions for stakeholders3. How well do the access criteria enable government to further the objects and principles

of the NDIS Act? With particular reference to the following principles:People with disability have the same right as other members of Australian societyto realise their potential for physical, social, emotional and intellectualdevelopmentPeople with disability should be supported to participate in and contribute to socialand economic life to the extent of their abilityPeople with disability and their families and carers should have certainty thatpeople with disability will receive the care and support they need over theirlifetime.

4. How clearly defined are the access criteria?5. What amendments could be made to the legislative framework (if any) to:

a. Enhance the clarity of the access criteria?b. Improve the effectiveness and/or efficiency of the access request process?


5. Participant plansOnce an individual becomes a participant of the NDIS, they start the planning andassessment process. At the end of this process, participants will have a participant plan.Under Section 33 of the NDIS Act, a participant plan must include:

► A statement of goals and aspirations – prepared by the participant, this specifies thegoals, objectives and aspirations of the participant, and the environmental andpersonal context of the participant’s living.

► A statement of participant supports – prepared with the participant and approved bythe NDIA, this specifies:

► The general supports (if any) that will be provided to, or in relation to, theparticipant

► The reasonable and necessary supports (if any) that will be funded under the NDIS

► The date by which, or the circumstances in which, the NDIA must review the plan

► The management of the funding for supports under the plan

► The management of other aspects of the plan.

As indicated above, the NDIS funds supports for participants that are deemed to be‘reasonable and necessary’. Section 34 of the NDIS Act defines a reasonable and necessarysupport as one that:

► Will assist the participant to pursue the goals, objectives and aspirations included intheir statement of goals and aspirations

► Will assist the participant to undertake activities, so as to facilitate their social andeconomic participation

► Represents value for money in that the costs of the support are reasonable, relative toboth the benefits achieved and the cost of alternative support

► Will be, or is likely to be, effective and beneficial for the participant, having regard tocurrent good practice

► Takes account of what it is reasonable to expect families, carers, informal networks andthe community to provide

► Is most appropriately funded or provided through the NDIS, and is not moreappropriately funded or provided through other service systems (such as the healthsystem, the education system, etc.)

The Supports for Participants Rules provide more detail on how the concept of reasonableand necessary supports should operate in practice. In particular, these rules outline thesupports that are more appropriately funded or provided through other service systems(and, as such, will not be funded or provided under the NDIS).

Division 3 of Chapter 3 of the NDIS Act outlines who can be responsible for managing thefunding for supports under a participant’s plan (i.e. the participant, a registered plan


management provider, the NDIA or the plan nominee), and how this responsibility should bedetermined. Section 44 of the NDIS Act and the Plan Management Rules detail thecircumstances in which participants must not manage the funding for supports under theirplan to a specified extent. These are:

► If the participant is an insolvent under administration

► If the NDIA is satisfied that management of the plan to that extent would: (1) presentan unreasonable risk to the participant; or (2) permit the participant to managematters that are prescribed by the NDIS Rules.

Division 4 of Chapter 3 of the NDIS Act outlines three mechanisms by which a participant’splan can be reviewed (and potentially changed):

► The participant can request the NDIA to conduct a review of their plan (which they cando so at any time). The NDIA, however, can decide not to conduct the review

► The NDIA can initiate a review of the participant’s plan (which it can do so at any time)

► The participant’s plan can prescribe a date by when, and the circumstances in which, areview of the plan must be conducted

The Disability Reform Council recently endorsed an Information, Linkages and CapacityBuilding (ILC) Policy Framework.5 ILC (formerly known as Tier 2) is the component of theNDIS that provides information, linkages and referrals to efficiently and effectively connectpeople with disability, their families and carers with appropriate disability, community andmainstream supports. It is intended that ILC will not only allow the NDIS to provide betteroutcomes for people with disability, their families and carers, but also reduce the demandfor, and level of support required through, individual funding packages. Funding for ILC isauthorised by Chapter 2 of the NDIS Act.

Questions for stakeholders6. How well does the legislative framework’s definition of what constitutes ‘reasonable

and necessary supports’ support the independence and social and economicparticipation of people with disability?

7. What amendments could be made to the legislative framework (if any) to:a. Improve the effectiveness and/or efficiency of the participant planning and

assessment process (including review)?b. Ensure the NDIA has the required capacity to control costs in relation to participant

plans?

5 For more detail, see: http://www.ndis.gov.au/ilc-policy.

http://www.ndis.gov.au/ilc-policy


6. Registered providers of supportsAny person or entity can apply to the NDIA to be a registered provider of supports (in termsof managing the funding for supports under plans and/or the provision of supports). Tosecure registration, a person or entity must:

► Have an Australian Business Number (ABN) and an account with a financial institution

► Make a series of declarations in relation to their compliance with the NDIA’s terms ofbusiness and other relevant legislation (e.g., employment and workplace health andsafety laws)

► Submit evidence of their suitability to manage the funding for supports under plansand/or to provide supports (such as their qualifications and experience)6

As at June 2015, there were 1,955 providers registered with the NDIA.7

Under the Registered Providers of Supports Rules, registered providers are not required toreport to the NDIA on a periodic basis. They are required, however, to notify the NDIA in theevent of a number of prescribed outcomes (e.g., if the provider is the subject of an adverseaction by a responsible authority or the provider becomes an insolvent underadministration).

Under the NDIS Act, it is not intended that all providers will be registered with the NDIA. If aprovider wants to manage a participant’s plan on behalf of the NDIA or deliver supportsunder a participant’s plan managed by the NDIA, they are required to be registered.Participants (or their nominee) that self-manage the supports in their plan, however, arenot required to use NDIA-registered providers.

During the trial period, the NDIA is responsible for the registration of NDIS providers, whilethe States and Territories have agreed to maintain existing quality and safeguardsarrangements. To support the transition to full scheme, the Disability Reform Council hasagreed to the development of a national quality and safeguarding framework for the NDIS.A Consultation Paper on the national framework was released in February 2015.8 Itcanvassed a range of options relating to:

► NDIA provider registration

► Systems for handling complaints

► Ensuring staff are safe to work with participants

► Safeguards for participants who manage their own plans

► Reducing and eliminating restrictive practices in NDIS funded supports

6 National Disability Insurance Scheme (Registered Providers of Supports) Rules 2013.7 NDIA (2015), Quarterly Report to COAG Disability Reform Council, 30 June, available at:http://www.ndis.gov.au/sites/default/files/Q4-Report-to-COAG-Disability-Reform%20Council.pdf.8 NDIS Senior Officials Working Group for the Disability Reform Council (2015), Proposal for aNational Disability Insurance Scheme Quality and Safeguarding Framework: Consultation paper,February.

http://www.ndis.gov.au/sites/default/files/Q4-Report-to-COAG-Disability-Reform%20Council.pdf


Agreement is currently being sought from Commonwealth, and State and TerritoryMinisters to releasing the consultation report. Once agreed the report will be made publiclyavailable. It is expected that a COAG Regulation Impact Statement will be completed andmade available for consideration to Ministers in early-2016.

Questions for stakeholders8. How well does the legislative framework (including, but not limited to, the provider

registration requirements) enable government to promote innovation, quality,continuous improvement, contemporary best practice and effectiveness in theprovision of supports to people with disability?

9. Do the registration requirements strike the right balance between supporting principlesof choice and control, including in relation to taking reasonable risks and the rights ofpeople with a disability to freedom from abuse, neglect and exploitation?

10. How clearly defined is the NDIA’s role in the registration of providers?

11. What amendments could be made to the legislative framework (if any) to enhance theeffectiveness and/or efficiency of the provider registration process?


7. NomineesThe NDIS is based on the presumption that people with disability have capacity to makedecisions which affect their own lives. The NDIS Act recognises, however, that ‘there maybe circumstances where it is necessary for a person to be appointed as a nominee of aparticipant, and to act on behalf of, or make decisions on behalf of, a participant.’9

The NDIS Act gives force to two types of nominees:

► A plan nominee – who can undertake all activities that a participant would undertakeunder the NDIS, including the preparation, review or replacement of the participant’splan, and/or the management of the funding for supports in the participant’s plan. Aplan nominee, however, cannot undertake activities on behalf of a participant that maybe outlined when the plan nominee is appointed.

► A correspondence nominee – who can undertake all activities that a participant wouldundertake, except for the preparation, review or replacement of the participant’s plan,and/or the management of the funding for supports in the participant’s plan. ‘The actsthat a correspondence nominee is able to do include making requests to the Agency(for example, requests for information), and receiving notices from the Agency, onbehalf of the participant.’10

Under the NDIS Act, a nominee can be appointed either at the request of the participant orat the initiative of the CEO of the NDIA. With reference to the latter, the Nominees Rulesstates that:

► ‘If the participant has not requested that a nominee be appointed’, the CEO is to haveregard to the ‘principle that a nominee should be appointed only when necessary, as alast resort, and subject to appropriate safeguards’.

► ‘In appointing a nominee in such circumstances, the CEO will have regard to theparticipant’s wishes and the participant’s circumstances (including their formal andinformal support networks).’ 11

The legislative framework requires that, in appointing a nominee, the CEO ‘must haveregard to whether there is a person who, under a law of the Commonwealth, a State or aTerritory:

a. ‘Has guardianship of the participant’

OR

b. ‘Is a person appointed by a court, tribunal, board or panel (however described) who haspower to make decisions for the participant and whose responsibilities in relation to theparticipant are relevant to the duties of a nominee’12

The NDIS Act requires nominees ‘to ascertain the wishes of the participants and to act in amanner that promotes the personal and social wellbeing of the participant.’ 13 This

9 National Disability Insurance Scheme (Nominees) Rules 2013.10 Ibid.11 Ibid.12 National Disability Insurance Scheme Act 2013.


requirement, however, is based on the reasonable judgment of the nominee. For instance,Section 80(3) of the NDIS Act allows nominees to refrain ‘from doing an act if, at therelevant time, the nominee reasonably believes that:

a. ‘He or she has ascertained the wishes of the participant in relation to the act

b. ‘Not doing the act promotes the personal and social wellbeing of the participant’ 14

In August 2014, the Australian Law Reform Commission (ALRC) released the Final Reportfrom its review of equal recognition before the law and legal capacity for people withdisability.15 As part of the review, the ALRC developed a Commonwealth decision-makingmodel and national decision-making principles, which provide a foundation for supporteddecision-making for people with disability. The Commonwealth decision-making model isbased on the twin concepts of:

► Supporters – a person appointed by a person requiring decision-making support to: (1)support them in making decisions; (2) develop their decision-making capacity; and/or(3) support them in expressing their will and preferences. ‘Where a supporter ischosen, ultimate decision-making authority remains with the person who requiresdecision-making support.’16

► Representatives – a person who either assists a person requiring decision-makingsupport to make decisions or, where necessary, makes decisions on their behalf. In asituation where a person requiring decision-making supports is unable to make adecision, representatives are required to make a decision for the person based on whatthe person would likely want and, in the least, with consideration to the human rightsrelevant to the situation.

The national decision-making principles, meanwhile, are outlined in Figure 1.

13 Ibid.14 Ibid.15 ALRC (2014), Equality, Capacity and Disability in Commonwealth Laws, ALRC Report 124, August.16 Ibid.


Figure 1: ALRC National Decision-Making Principles

Principle 1: The equal right to make decisionsAll adults have an equal right to make decisions that affect their lives and to have thosedecisions respected.Principle 2: SupportPersons who require support in decision-making must be provided with access to thesupport necessary for them to make, communicate and participate in decisions that affecttheir lives.Principle 3: Will, preferences and rightsThe will, preferences and rights of persons who may require decision-making support mustdirect decisions that affect their lives.Principle 4: SafeguardsLaws and legal frameworks must contain appropriate and effective safeguards in relation tointerventions for persons who may require decision-making support, including to preventabuse and undue influence.

Source: Recommendation 3–1, ALRC (2014), Equality, Capacity and Disability in CommonwealthLaws, ALRC Report 124, August.

The ALRC also made a number of recommendations regarding the treatment of decision-making under the NDIS Act, the NDIS Rules, the Social Security (Administration) Act 1999(Cth) and the Aged Care Act 1997 (Cth). The recommendations relating to the NDISlegislative framework include:

► Amend the objects and principles of the NDIS Act to ensure consistency with thenational decision-making principles.

► Amend the NDIS Act and NDIS Rules to replace ‘correspondence nominees’ with‘supporters’, and ‘plan nominees’ with ‘representatives’.

► Amend the NDIS Act ‘to incorporate provisions dealing with the process and factors tobe taken into account by the CEO of the [NDIA] in appointing representatives. Theseprovisions should make it clear that the CEO’s powers are to be exercised as a measureof last resort, with the presumption that an existing state or territory appointee will beappointed, and with particular regard to the participant’s will, preferences and supportnetworks.’17

► Amend the NDIS Act ‘to provide that, before exercising the power to appoint arepresentative, the CEO of the [NDIA] may make an application to a state or territoryguardianship or administration body for the appointment of a person with comparablepowers and responsibilities. The CEO may then exercise the power to appoint thatperson as a representative under the NDIS Act.’18

17 Ibid.18 Ibid.


Questions for stakeholders12. How well do the nominee provisions provide choice and control to, and protect the

rights and wishes of, people with disability?13. What amendments could be made to the nominee provisions (if any) to:

a. Enhance effectiveness/and or efficiencyb. Ensure the legislative framework interacts appropriately with State and Territory

legislation?


8. Reviewable decisionsChapter 4 (pt 6) of the NDIS Act outlines what decisions made by the NDIA are reviewabledecisions, and the process of administrative review. Broadly speaking, this process entails:

► The NDIA must notify each person directly affected by a reviewable decision that theycan request the CEO to review the decision

► On receiving a request to review a reviewable decision, the CEO will allocate thedecision to an internal reviewer. On completing the review, the internal reviewer willconfirm the reviewable decision, vary the reviewable decision, or set aside thereviewable decision and substitute a new decision

► If a person is not satisfied with the outcome of internal review, they can make anapplication to the Administrative Appeals Tribunal (AAT) for review.

Questions for stakeholders14. What amendments could be made to the legislative framework (if any) to enhance the

effectiveness and/or efficiency of the merit review process?


9. Compensation and debt recoveryChapter 5 of the NDIS Act and the Supports for Participants – Accounting for CompensationRules provide the basis for which the NDIS interacts with compensation payments. Thebroad intent of these provisions is that the NDIS should not fund supports that could befunded by compensation payments for which participants are eligible. Accordingly, theNDIS Act grants the CEO of the NDIA the power to:

► Require a participant or prospective participant to take action to obtain compensation(in situations where the participant or prospective participant is deemed entitled tocompensation and not to have taken action to claim or obtain the compensation)

► Take action to claim or obtain compensation in the name of a participant or prospectiveparticipant (in the event that a participant or prospective participant does not takerequired actions themselves)

► Recover compensation fixed after NDIS payments have been made

► Take into account compensation, or forgone compensation, in approving a statement ofparticipant’s supports

Chapter 7 (pt 1) of the NDIS Act provides the NDIA with debt recovery powers. The intent ofthese provisions is to ensure that all funding ascribed for supports under the NDIS is beingused for its intended purposes and with integrity, and that all payments made by the NDISare to people entitled to receive them. Where this does not occur, whether due toadministrative or systematic fault, participant error, or intentional fraud, the NDIS Act givesthe NDIA the ability to recover these costs.

Questions for stakeholders15. What amendments could be made to the legislative framework (if any) to

a. Enhance the effectiveness and/or efficiency of the compensation and/or debtrecovery processes?

b. Ensure the NDIA has the required capacity to control costs in relation to thecompensation and/or debt recovery processes?


10. GovernanceThe governance arrangements of the NDIS are set out in Chapter 1 (pt 5), Chapter 6, andChapter 7 (pt 2 and 3) of the NDIS Act, as well as through the Risk Management Rules andthe Rules for the Scheme Actuary. These arrangements cover several layers of interlinkedresponsibility, covering multiple parties including the NDIA, the NDIS Board andIndependent Advisory Council, the Commonwealth Minister, the COAG Standing Council onDisability Reform (now the COAG Disability Reform Council), and the Joint SelectCommittee of the Commonwealth Parliament (Figure 2).

Figure 2: NDIS governance arrangements

Source: NDIA (2015), ‘Governance’, available at: http://www.ndis.gov.au/about-us/governance.

Table 2 summarises the roles and responsibilities of key governance entities of the NDIS, asstipulated under the NDIS Act.

Table 2: Roles and responsibilities of key governance entities of the NDIS

Entity Description

COAG StandingCouncil on DisabilityReform (now theCOAG DisabilityReform Council)

► Comprised of Treasurers and relevant Ministers from alljurisdictions.

► Primary decision-maker on NDIS policy issues (noting that somedecisions are taken to COAG)

CommonwealthMinister

► Responsible for administering the NDIS legislation and the NDIA,exercising statutory powers and making the NDIS Rules (with theagreement of the States and Territories).

► Is able to delegate powers to the CEO NDIA, with the agreementof the jurisdictions.

NDIA Board ► Comprised of eight members and a Chair. Board members arerequired to have skills, experience or knowledge in at least one ofthe following fields: (1) the provision or use of disability services;(2) the operation of insurance schemes, compensation schemes


Entity Descriptionor schemes with long-term liabilities; (3) financial management;and (4) corporate governance.

► The functions of the Board include setting the strategic directionof the NDIA, maintaining stakeholder relationships with all othergovernance stakeholders, and ensuring NDIA compliance withstatutory requirements.

IndependentAdvisory Council

► Comprised of up to 12 members and a Principal Member. Councilmembership is determined on a representative basis. Keyrepresentation criteria include: (1) a majority of the members arepeople with disability; (2) at least two of the members are carersof people with disability; (3) at least one of the members is aperson who has skills, experience or knowledge in relation todisability in rural or regional areas; and (4) at at least one of themembers is a person who has skills, experience or knowledge inthe supply of equipment, or the provision of services, to peoplewith disability.

► The Council’s function is to provide independent advice to theBoard in regards to the performance of the NDIA across a rangeof aspects, in which its members have experience. The Board isobligated to consider all Council advice and must report back tothe Standing Council on advice received and any actions taken.

CEO ► Appointed by the Board for a specified term not longer than threeyears, excluding the first CEO who was to be appointed by theMinister.

► Responsible for the day-to-day administration of the Agency anddelegated most of the administrative powers in the legislation,such as making decisions on access requests, participant plans,and funded supports.

► The CEO is able to delegate any or all of their powers under thelegislation to officers of the NDIA.

Scheme Actuary ► Nominated by the Board. There is no limit on the duration of aperson’s nomination as Scheme Actuary.

► Must be a Fellow of The Institute of Actuaries of Australia. TheScheme Actuary cannot be the same person as the ReviewingActuary.

► Among other things, responsible for assessing the financialsustainability of the NDIS.

Reviewing Actuary ► Nominated by the Board for a specified term not longer thanthree years.

► Must be a Fellow of The Institute of Actuaries of Australia. TheReviewing Actuary cannot be the same person as the SchemeActuary.

► Among other things, responsible for reviewing and reporting tothe Board on actuarial reports and advice received by the Board.


The governance arrangements of the NDIS reflect the federal nature of the Scheme. Whilethe Commonwealth Minister plays a key decision-making role in the NDIS, he or she isrequired in many instances (e.g., Board and Council appointments and the making ofNDIS Rules) to first secure agreement from the States and Territories before making adecision.

The NDIS Act also establishes the functions of the NDIA. Key among these functions are:

► To deliver the NDIS so as to:

► Support the independence, and social and economic participation, of people withdisability

► Enable people with disability to exercise choice and control in the pursuit of theirgoals and the planning and delivery of their supports

► Ensure that the decisions and preferences of people with disability are respectedand given appropriate priority

► Promote the provision of high quality and innovative supports that enable peoplewith disability to maximise independent lifestyles and inclusion in the mainstreamcommunity

► Ensure that a reasonable balance is achieved between safety and the right ofpeople with disability to choose to participate in activities involving risk

► To manage, and to advise and report on, the financial sustainability of the NDIS

► To develop and enhance the disability sector, including by facilitating innovation,research and contemporary best practice in the sector

► To build community awareness of disabilities and the social contributors to disabilities

► To collect, analyse and exchange data about disabilities and the supports (includingearly intervention supports) for people with disability

► To undertake research relating to disabilities, the supports (including early interventionsupports) for people with disability and the social contributors to disabilities

Questions for stakeholders16. How well do the governance arrangements enable government to further the objects

and principles of the NDIS Act?17. What amendments could be made to the legislative framework (if any) to enhance the

effectiveness and/or efficiency of the NDIS’s administration?


11. Other mattersThis review encompasses all aspects of the NDIS legislative framework. Accordingly, if youhave any issue or comments to raise in respect to areas not covered by this paper, you arenonetheless invited to submit them. This discussion paper focuses on what appear to be keyareas of interest and contention, but is by no means intended to be an exhaustive collectionof all existing issues surrounding the legislative framework.

Questions for stakeholders18. Are there any other aspects of the NDIS legislative framework that you believe are

impacting on:a. Government’s ability to further the objects and principles of the NDIS Act?b. The efficiency of the NDIS’s administration?c. The capacity of the NDIA to control costs?d. Other legislation, including State and Territory legislation?e. The effectiveness of information sharing between the NDIA, jurisdictions and

providers?


Appendix A Review Terms of Reference

The terms of reference of this review, as agreed by Ministers, require that the reviewconsider:

1. The operation of the NDIS Act in furthering its Objectives and Principles

2. If the NDIS Act can be simplified

3. If the NDIS Act can be amended to increase the efficiency of the NDIS’s administration,including providing greater clarity around access requirements

4. If the NDIS Act can be amended to ensure that NDIA has the required capacity tocontrol costs

5. Whether parts of the NDIS Act could be refined, removed or replaced for the purposesof more effective regulation (including de-regulation where appropriate)

6. If the NDIS Act can be amended to ensure it interacts appropriately with otherlegislation, including State and Territory legislation

7. Any interim or final recommendations for legislative change from other reviews

8. Any other matter relevant to the general operation of the NDIS Act


Appendix B Objects and principles of the NDIS Act

ObjectsThe objects of the NDIS Act are to:

a. In conjunction with other laws, give effect to Australia’s obligations under theConvention on the Rights of Persons with Disabilities done at New York on13 December 2006 ([2008] ATS 12)

b. Provide for the National Disability Insurance Scheme in Australia

c. Support the independence and social and economic participation of people withdisability

d. Provide reasonable and necessary supports, including early intervention supports, forparticipants in the National Disability Insurance Scheme launch

e. Enable people with disability to exercise choice and control in the pursuit of their goalsand the planning and delivery of their supports

f. Facilitate the development of a nationally consistent approach to the access to, and theplanning and funding of, supports for people with disability

g. Promote the provision of high quality and innovative supports that enable people withdisability to maximise independent lifestyles and full inclusion in the mainstreamcommunity

h. Raise community awareness of the issues that affect the social and economicparticipation of people with disability, and facilitate greater community inclusion ofpeople with disability

i. In conjunction with other laws, give effect to certain obligations that Australia has as aparty to:

i. The International Covenant on Civil and Political Rights done at New York on16 December 1966 ([1980] ATS 23)

ii. The International Covenant on Economic, Social and Cultural Rights done at NewYork on 16 December 1966 ([1976] ATS 5)

iii. The Convention on the Rights of the Child done at New York on 20 November1989 ([1991] ATS 4)

iv. The Convention on the Elimination of All Forms of Discrimination Against Womendone at New York on 18 December 1979 ([1983] ATS 9)

v. The International Convention on the Elimination of All Forms of RacialDiscrimination done at New York on 21 December 1965 ([1975] ATS 40)

General principles guiding actions under the NDIS Act1. People with disability have the same right as other members of Australian society to

realise their potential for physical, social, emotional and intellectual development.


2. People with disability should be supported to participate in and contribute to social andeconomic life to the extent of their ability.

3. People with disability and their families and carers should have certainty that peoplewith disability will receive the care and support they need over their lifetime.

4. People with disability should be supported to exercise choice, including in relation totaking reasonable risks, in the pursuit of their goals and the planning and delivery oftheir supports.

5. People with disability should be supported to receive reasonable and necessarysupports, including early intervention supports.

6. People with disability have the same right as other members of Australian society torespect for their worth and dignity and to live free from abuse, neglect andexploitation.

7. People with disability have the same right as other members of Australian society topursue any grievance.

8. People with disability have the same right as other members of Australian society to beable to determine their own best interests, including the right to exercise choice andcontrol, and to engage as equal partners in decisions that will affect their lives, to thefull extent of their capacity.

9. People with disability should be supported in all their dealings and communicationswith the Agency so that their capacity to exercise choice and control is maximised in away that is appropriate to their circumstances and cultural needs.

10. People with disability should have their privacy and dignity respected.

11. Reasonable and necessary supports for people with disability should:

a. Support people with disability to pursue their goals and maximise theirindependence

b. Support people with disability to live independently and to be included in thecommunity as fully participating citizens

c. Develop and support the capacity of people with disability to undertake activitiesthat enable them to participate in the mainstream community and in employment

12. The role of families, carers and other significant persons in the lives of people withdisability is to be acknowledged and respected.

13. The role of advocacy in representing the interests of people with disability is to beacknowledged and respected, recognising that advocacy supports people with disabilityby:

a. Promoting their independence and social and economic participation

b. Promoting choice and control in the pursuit of their goals and the planning anddelivery of their supports


c. Maximising independent lifestyles of people with disability and their full inclusion inthe mainstream community

14. People with disability should be supported to receive supports outside the NationalDisability Insurance Scheme, and be assisted to coordinate these supports with thesupports provided under the National Disability Insurance Scheme.

15. Innovation, quality, continuous improvement, contemporary best practice andeffectiveness in the provision of supports to people with disability are to be promoted.

16. Positive personal and social development of people with disability, including childrenand young people, is to be promoted.

17. It is the intention of the Parliament that the Ministerial Council, the Minister, the Board,the CEO and any other person or body is to perform functions and exercise powersunder this Act in accordance with these principles, having regard to:

a. The progressive implementation of the National Disability Insurance Scheme

b. The need to ensure the financial sustainability of the National Disability InsuranceScheme

General principles guiding actions of people who may do acts orthings on behalf of othersIt is the intention of the Parliament that, if this Act requires or permits an act or thing to bedone by or in relation to a person with disability by another person, the act or thing is to bedone, so far as practicable, in accordance with both the general principles set out inSection 4 and the following principles:

a. People with disability should be involved in decision making processes that affect them,and where possible make decisions for themselves

b. People with disability should be encouraged to engage in the life of the community

c. The judgements and decisions that people with disability would have made forthemselves should be taken into account

d. The cultural and linguistic circumstances, and the gender, of people with disabilityshould be taken into account

e. The supportive relationships, friendships and connections with others of people withdisability should be recognised

f. If the person with disability is a child—the best interests of the child are paramount, andfull consideration should be given to the need to:

i. Protect the child from harm

ii. Promote the child’s development

iii. Strengthen, preserve and promote positive relationships between the child and thechild’s parents, family members and other people who are significant in the life ofthe child

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