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What Is the NDIS?

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The National Disability Insurance Scheme


The National Disability Insurance Scheme (NDIS) has been labelled one of the most important social policy reforms that Australia has seen in a century. The scheme represents a revolutionary reform of the disability system in Australia, with its significance likened to the introduction of Australia’s universal national healthcare system Medicare. This chapter provides an overview of the NDIS as it was originally described by the Productivity Commission in its 2011 inquiry into a national disability long-term care and support scheme in Australia. It provides an interpretation of how the NDIS sought to introduce a new approach to disability care and support, based on insurance principles. It also comments on several headline changes made to the design of the scheme as it was written into intergovernmental agreements and legislated through the National Disability Insurance Scheme Act 2013 (the Act).

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  1. 1.

    The scheme would not replace the disability support pension, which would continue outside of the scheme.

  2. 2.

    The language of ‘tiers’ is no longer used by governments to describe the different aspects of the scheme. The movement away from ‘tiers’ language was to avoid the assumption that the scheme was a hierarchy of supports with some aspects being ‘better’ or more desirable than others. We have chosen to use the language of tiers as we think it is a useful way to differentiate between different aspects of the scheme.

  3. 3.

    The NDIS was intended to cover all residents of Australia who were either a citizen or permanent resident, New Zealand citizens who were Australian residents on 26 February 2001 and asylum seeks (Productivity Commission 2011, 1:64).

  4. 4.

    According to the Productivity Commission (2011, 2:14), ‘permanent’ refers to the irreversible nature of the disability even if it may be of chronic episodic nature.

  5. 5.

    An exception to the aged care requirement was to be made for people reaching pension age while already in the NDIS. These people could elect to either stay with the NDIS or move to the aged care system. If moving to the aged care system, they would be governed by the support arrangements for that system, while staying with the NDIS would mean their previous care arrangements would continue. Either way, people at or over the pension age would be required to make a capped co-contribution to their care on the same basis as the general population with other costs to be met by the Commonwealth Government under the National Health and Hospital Network Agreement (Productivity Commission 2011, 1:16–17).

  6. 6.

    Unlike the NDIS , the NIIS was to be ‘fully funded’ with each jurisdiction responsible for underwriting its own scheme. This was considered more feasible for these state-funded schemes, which would be funded from various sources, and would allow the NIIS to use of price signals to encourage safe choices and reduce accidents (e.g. higher premiums on dangerous vehicles, such as motorbikes) (Productivity Commission 2011, 2:858–859).


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© 2021 The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.

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Cowden, M., McCullagh, C. (2021). What Is the NDIS?. In: Cowden, M., McCullagh, C. (eds) The National Disability Insurance Scheme. Palgrave Macmillan, Singapore.

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