Most of the savings in this year's budget came from cuts to the National Insurance Disability Scheme (NDIS).
The government wants to save A$37.8 billion over four years, predominantly by cutting NDIS eligibility for more than 300,000 people with higher functional capacity.
This includes more than 160,000 current NDIS participants, as well as those who would have entered the scheme.
But the success of a slimmed-down scheme will depend on the availability of high-quality alternative services for those who no longer qualify for the NDIS.
With eligibility changes starting in January 2028 , the clock is ticking to establish these alternative " foundational supports ".
Remind me, what's been announced and why?
The federal government has committed $5 billion - a 50% share of a $10 billion funding agreement with states and territories - for foundational supports.
But aside from $2 billion provided to fund Thriving Kids , there is little detail in the budget about what else is planned.
The remaining $3 billion is currently being held in a contingency fund, and has not been earmarked for any specific programs.
Foundational supports are "commissioned services". This means providers are contracted to deliver a set of programs or supports.
Currently, people on the NDIS source these supports from the market, paying for them using their NDIS plan.
Commissioned services can be effective. They can provide services to more people, at a lower cost per person, and ensure services are available where few others exist.
Direct commissioning can also help governments oversee the quality of services and ensure people are directed to supports with a strong evidence base. Spending is then less likely to be wasted on ineffective services, such as junk therapies.
Direct commissioning is better suited to services that need funding certainty, rather than competition, to thrive, such as information and advocacy, supported decision-making and peer support.
Conversely, it's likely that commissioned services will offer less choice and individual tailoring than the NDIS.
Foundational supports will work best when they address lower levels of need and where the priority is timely access to an evidence-based service, rather individual autonomy and choice.
Priorities for government
The government should target foundational supports that focus on specific groups of people who will not in the future receive support from the NDIS.
It should also focus on services where a direct commissioning approach would be a more effective and efficient way of ensuring access to evidence-based supports.
Here are three ways to put this into practice.
1. Expand Thriving Kids
Supports for children with developmental delays and disability should be a priority. These should be aimed at building the independence and capacity of children and families.
The government's Thriving Kids initiative is a good start. But it is inadequately funded to meet the likely demand, and only covers children aged eight and under. The program should be scaled up and extended to all school-aged children.
Scale is important. Too few services can mean either there aren't enough spots for each service and long wait-lists, or the services are spread too thin: there's a little bit of help for everyone but not nearly enough.
Foundational supports must be a good substitute for individualised funding and commissioned in line with best practice .
This might mean, for example, allied health professionals such as occupational therapists or speech pathologists providing group-based support in various settings, including childcare centres, schools and community spaces such as libraries.
The aim would be to provide enough practical, low-barrier support early, rather than requiring families to navigate fragmented clinical systems on their own.
2. Develop supports for people with psychosocial disability
Psychosocial disability is where a severe and enduring mental health condition impairs a person's ability to function. And currently there is significant unmet need for psychosocial supports outside the NDIS.
The government should develop a new national psychosocial disability program to provide evidence-based supports for adults with significant psychosocial disability.
The program should deliver consistent services nationwide, tailored to the needs of different regions, with specific services to meet the needs of First Nations people.
Examples of targeted foundational supports for people with psychosocial disability could include:
- community participation programs, such as clubhouses and social or activity-based groups
- recovery colleges (mental health education services co-developed and delivered by people with lived experience and mental health professionals)
- family education
- peer-led supports.
3. Increase other supports for people with disability
The government should also ensure more generalised disability supports are available for all people with disability . These are important to help people with disability develop skills, increase independence, and participate in the community.
These supports are particularly important for people with intellectual disabilities and cognitive impairments - whether they qualify for the NDIS or not. And they will become more important if the government proceeds with cuts to NDIS participants' budgets to social and community participation funding.
The government has set aside an additional $200 million for this purpose, but that's not nearly enough.
People with disability should have access to:
information about disabilities, either through mainstream services or through specialist sites such as the Disability Gateway and disabled peoples' organisations, and referral to other forms of support
skills development, including self-advocacy and supported decision-making, and the skills required to get and keep a job, as well as navigating housing options
peer support programs
programs to build their social and community participation
programs aimed at parents and carers
A lot has to go right for the $37.8 billion in savings to be delivered without leaving disabled people to fall through the cracks.
The government needs to act now to develop and invest in the foundational supports that will not only make its budget add up, but ensure that Australians living with disability get the help they need.
Grattan Institute's Disability Program has support from the Summer Foundation.
Owain Emslie does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
