Disability ministers warn NDIS overhaul risks leaving 200,000 participants without services

State and territory disability ministers have rung alarm bells over the Albanese government’s proposed overhaul of the NDIS, warning they can’t deliver “like-for-like services” for more than 200,000 participants expected to be shifted off the scheme by 2031.

The Albanese government’s National Disability Insurance Scheme bill is designed to dramatically curb the growth of the $50bn-a-year scheme by first reducing budgets and then the number of people who can access it from 2028.

The legislation is being scrutinised by a Labor-led Senate committee, which is due to deliver recommendations next week.

In a joint submission uploaded to the NDIS inquiry on Thursday, states and territories agreed that curbing the scheme’s growth was important, but warned that goal should not be prioritised over participant safety, wellbeing and life outcomes.

Disability ministers said they were not “meaningfully consulted” on the proposed change and were concerned about unilateral powers given to the federal NDIS minister “signalling a broader shift away” from shared governance.

More than 240,000 participants are expected to be shifted off the NDIS in the four years after new eligibility rules are introduced in 2028, department modelling shows.

Disability ministers criticised a lack of “clearly defined alternative supports” which it said created the “risk of unmet need and cost-shifting to state and territory systems (including health, education and justice), which are not equipped for increased demand and cannot deliver like-for-like services with the NDIS”.

“Without a careful, coordinated approach that aligns these changes with broader improvements across the disability support system, there is a significant risk that people with disability will end up in hospitals or other settings that are inappropriate and unable to meet their needs, or have no access to services at all,” the submission said.

“States and territories are not in a position, and have made no agreement, to deliver like-for-like services to people who are exited from the NDIS.”

The Senate inquiry has been told that planned 50% cuts to social and community participation budgets would increase isolation, segregation and create “unsafe situations” for NDIS participants.

The federal health minister, Mark Butler, refused to be drawn on the concerns when asked on Thursday if the government was prepared to reconsider the scale of the cuts.

“The plan that I announced many weeks ago now … and it was part of the budget that the treasurer delivered in May, was a very well-developed plan that thought carefully about the way in which we could get the NDIS back on track, secure it for the long term, but very much still with people with disability at its centre,” Butler said.

The minister dismissed the need to extend the Senate inquiry as he reaffirmed his hope to pass the legislation before parliament rose for the winter break on 2 July.

The opposition leader, Angus Taylor, said the Coalition wanted the inquiry to be longer but did not say whether there would be a deal with the Greens to extend it.

“The most important thing here, though, is that we actually see what is necessary to make it sustainable,” he said.

Victoria unveils first stage of Thriving Kids plan

The Victorian government unveiled the first details of its Thriving Kids program on Thursday, which will begin rolling out from October.

Thriving Kids was announced by the federal government last year as part of its plan to remove children under nine with mild developmental delays and autism from the NDIS by 2028. The $4bn plan is jointly funded by state and territory governments and the commonwealth.

Under the Victorian plan, every child will be offered two developmental assessments – one before starting kindergarten and another before primary school – to identify developmental delays.

The free assessments will be conducted by clinicians and allied health professionals from maternal and child health services, kindergartens and early parenting centres.

The Victorian minister for children and disability, Lizzie Blandthorn, said the program would prepare children for the start of their education journey.

“All children develop at different ages, stages, and in different ways, each is their own unique person and personality. But we will make sure is that if there are any early indicators, they are picked up as early as possible, and then referred to the Thriving Kids service,” she said.

“Whether it be [for] peer support, family services, supported play group or allied health – like speech pathology or occupational therapy – we want to pick up all of those individual differences or delays, not just autism and neurodivergence.”

She stressed children with permanent and significant disabilities or those with high support needs will continue to access the NDIS.

Blandthorn said the Thriving Kids announcement was “unrelated to the bill” currently being examined by a federal Senate inquiry, which state and territory ministers are concerned goes “further” than the changes they had agreed to.