NDIS overhaul risks isolation, fears disability royal commissioner

One of the heads of the disability royal commission fears proposed changes to the national disability insurance scheme would lead to more isolation and segregation for Australians, ignoring one of the major lessons from the landmark inquiry.

Alastair McEwin, a former Australian disability discrimination commissioner, called on the Albanese government to halt its planned overhaul of the $50bn-per-year NDIS amid mounting concern in the disability community.

McEwin’s warning came as the government’s own NDIS reform advisory committee issued a “brutal” assessment in the first meeting of federal, state and territory disability ministers since legislation was introduced to parliament.

Labor is pursuing drastic measures in an attempt to contain the disability scheme’s surging cost and save $36.2bn over four years, including by tightening eligibility criteria and subjecting participants to standardised assessments.

It is also planning to cut budgets for social, civic and community participants, the stream of funding designed to reduce isolation and build independence.

The health minister, Mark Butler, has argued the cost of the supports were skyrocketing and not all were providing value for money, citing examples of support workers taking participants out only to spend the entire time scrolling on their phone.

“That’s not community participation. Yes, it’s getting out of the house, but we want something more than just getting out of the house,” Butler last month told Guardian Australia’s Australian Politics podcast after announcing the changes.

McEwin was concerned about the consequences of slashing budgets for social participation, particularly given the evidence he heard as a commissioner overseeing the royal commission into violence, abuse, neglect and exploitation of people with a disability.

The inquiry heard harrowing evidence about the affect of social isolation and segregation on people with a disability, along with proof of the benefits of community inclusion.

“One of the fundamental pillars of why we established the NDIS in the first place was so that people could get out and about into the community. The social and community participation factor is incredibly vital to almost everybody I know who is on the NDIS,” McEwin said.

“We can’t often quantify or qualify the impact because often it means how you’re feeling from a sense of belonging and inclusion in the community.”

Hearing-impaired participants such as McEwin can use the social participation budgets to hire Auslan interpreters, allowing them, for example, to better experience public events.

“We’re going to see a huge number of people more isolated, more segregated,” he said.

Internal government modelling first reported by Guardian Australia showed about half of all participants – 393,401 people – have funding for social activities in their NDIS plans.

That stream of funding for more than 60,000 participants is expected to be halved between October and February 2027, with the remaining to be cut by the end of next year.

The health department estimates the social funding reduction will result in an average 25% reduction for participants – rather than the full 50% cut – because not everyone spends all of their allocated funding.

The government will also set up a $200m fund to help mainstream and disability organisations run programs.

There are no changes to funding for daily living activities, such as showering, cooking and cleaning.

McEwin expressed reservations about “overreach” in the legislation, in particular new powers allowing the federal minister to cut funding to some supports and make decisions on pricing.

The changes will have ramifications for state and territory jurisdictions, which co-govern the scheme with the Commonwealth and have responsibility for helping to roll out the Thriving Kids program for children with autism and developmental delay.

Guardian Australia can reveal the disability ministers received what one state source described as a “brutal assessment” of the proposed overhaul from the government’s own NDIS reform committee.

The committee’s co-chairs, El Gibbs and Dougie Herd, warned the changes would harm participants and criticised the lack of consultation on the legislation, according to two sources familiar with Friday’s meeting.

A Senate inquiry into the NDIS bill is scheduled to hold public hearings on 9,10 and 11 June before tabling its findings on 16 June.

The Greens oppose the changes, meaning Labor will need to rely on the Coalition’s support to get it through the parliament.