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Government’s Runaway Spending on Disability

The government’s spending on NDIS threatens to bankrupt Australia.

The NDIS is a runaway spending rocket which is failing to serve the disabled and getting worse. The service was never set up correctly in the first place and continues to waste billions and let down those who need it because of endemic bureaucratic bungling. There’s zero accountability within this agency. It is letting some abuse the system and as taxpayers we’re footing an exorbitant bill. The NDIS is not fit for purpose, yet a disability service is desperately needed and not reaching many of those it was meant to assist.

In questioning Minister Gallagher about what Labor is doing to fix this problem her answers were unhelpful and it seems she is being deliberately obstructive. Creating another level of bureaucracy won’t address the problem. It’ll only add another burden for taxpayers and extra layers of complexity for those needing help to try and navigate. If Labor is hoping that by ignoring the NDIS problem it will go away, they will be disappointment.

The NDIS needs addressing now before it’s too late.

Transcript

In serving the people of Queensland and Australia, I have four questions. I’ll do a little bit of explaining to get to the point. One Nation simply cannot support a bill that establishes an entirely new disability bureaucracy when the bill does not even define ‘disability’. I wonder: is this an admission that the NDIS has failed or that the government is letting it run completely out of control? I’ll come back to that. 

I remind everyone of the hasty and ill-thought-out concoction of the NDIS. Prime Minister Gillard hastily introduced it for election purposes before an election. Then she was voted out, and the Liberals and the National Party inherited a complete mess. They tightened it up, but it’s still sloppy. In tightening it, we got mixed signals going about services that are being provided to the disabled. That leaves them in a totally inadequate situation. I’m concerned about taxpayers and the disabled in these remarks and questions. If the NDIS continues in its current form, it will send the entire country broke and continue to provide inadequate services to the disabled. 

This bill does not deal with the NDIS. It establishes an entirely new bureaucracy in an entirely new agency. If the Disability Services and Inclusion Bill 2023 and the associated consequential bill pass into law, the Minister for Social Services will be given legislative authority for new spending programs to cover the 88 per cent of Australians living with a disability who cannot access support under the National Disability Insurance Scheme at the moment. 

I want to talk about the NDIS now because it provides financial support to just 610,000 participants, or 12 per cent of Australia’s estimated population living with a disability, while being the second-most expensive social program after the age pension. The annual running costs in the year ending 30 June 2023 were $38.8 billion. That is 26 per cent higher than Medicare, $30.8 billion; 40 per cent higher than aged care, $27.7 billion; and 40 per cent higher than the support for state government hospitals, $27.3 billion. Minister Bill Shorten expects the annual running cost in 2026 to be $50 billion, making it almost double what is spent on state government hospitals. The NDIS is unsustainable at these levels and will not be able to properly provide services for the disabled. 

I’m not going to sign a blank cheque for any government. I won’t be giving the government more spending power until I know how taxpayer money goes to those to whom it is intended, and many of the disabled are not getting the services necessary. Like many Australians, I’ve worked hard to bring up my children and to pay my taxes. Every tax dollar that the NDIA wastes is a dollar that is not spent on health, education and keeping us safe. NDIS participants using their plan money to holiday in exotic places and paying excessively for ordinary items like transit wheelchairs and aluminium shower chairs diminishes support for the program and prevents services to other disabled people who deserve support. Until I’m satisfied the Labor government can manage their departments, I’m not going to give them any more spending power. 

The Auditor-General investigated decision-making in the NDIA, the agency, between 1 July 2016 and 31 March 2017 as part of his report Decision-making controls for sustainability—National Disability Insurance Scheme access. In one group of 150 cases that were reviewed, the decision-maker’s name was not recorded in 42 cases. In another 18 of the 150 cases, there was no record of the reasons for the decision. That’s not accountability for taxpayers’ money. In a review of another 1,339 cases, 13 per cent—that’s almost one in seven—did not have sufficient evidence to support decisions to give lifetime support under the NDIS Act 2013. 

These findings in 2017 led to the Auditor-General making a number of recommendations. Seven of the nine recommendations made in relation to improving decision-making controls and fraud controls were not fully implemented by the time the Auditor-General investigated the NDIA again last year. Despite a history of approving access to the NDIS without lawful authority, senior bureaucrats in the NDIA will not make sure all delegates are trained. Of the 1,147 NDIA planners employed by the NDIA on 30 June 2020, only 73 per cent—under three-quarters—of them had been trained to spend billions of hard-earned taxpayer money. No wonder the NDIA costs cannot be controlled! Not only does the government need to show me it can manage the NDIA in accordance with the law passed in this chamber, but it also needs to deal with the demand shock created by the introduction of the NDIS. The sudden high demand created by the tsunami of money in NDIS participant plans has caused the cost of seeing an occupational therapist, a speech therapist or a psychologist—as well as others—to skyrocket. NDIS is more generous than the Department of Veterans’ Affairs or aged care, and that leads to inequality. That should not be the case. It’s a mess. It’s time the government aligned the price it pays for the same service across different government programs.  

Anyone can apply for a participant package under the National Disability Insurance Scheme Act 2013, but only people with a disability who meet the age, residency and disability requirements and can demonstrate that support is reasonable and necessary are intended to get support for a lifetime. As I’ve already said, it’s a lottery at the moment because decision-making is so poor in the National Disability Insurance Agency due to its messy and improper formation and its lack of foundation at its birth.  

While public servants sit in air-conditioned offices, an army of poorly paid disability workers provide the core supports needed by people with a disability. Disability workers are poorly paid, trapped in a system with little job security or prospects. They’re often working with questionable service agencies. Their employers are small businesses which often have no relevant experience and are unable to provide training or support in what can be confronting and stressful situations. No wonder there’s a shortage of disability workers right now. 

I want to see all National Disability Insurance Agency plans de-identified and made public. Australians need to know what is being funded. They’re the ultimate payers for this service. Employing a qualified chef to teach someone how to cook at home is a luxury that we cannot afford. Prior to NDIS, it was estimated that families provided 80 per cent of the support for a person with a disability and the government provided 20 per cent. The introduction of the NDIS was to shift some, but not all, responsibility to government, with families providing 60 per cent of the support and the government providing the remaining 40 per cent. We don’t know much about the level of family support provided today, but we do know only 30 per cent of all plans are managed fully or partially by the participant or their family, which suggests that government is taking on far more responsibility than was ever planned. Participant managed plans account for 30 per cent of the number of plans but just 12 per cent of the NDIS budget. These budgets are spent, but not overspent. Another 60 per cent of plans are managed by someone other than the participant or their family. These managed plans account for 46 per cent of the NDIS, four times as much. The remaining 10 per cent of NDIS plans are NDIA managed, and they account for 42 per cent of the NDIS budget. The NDIA consistently underspends these plans. Why?  

Until I see lawful, responsible and effective by the National Disability Insurance Agency, I will not be supporting any new spending power by government. One Nation supports disability services, yet they have to be sustainable for the Australian taxpayer or there will be no services in the future, and those services that there are won’t be fit for the disabled. Spending on the NDIS will outstrip all Medicare services. There is billions of dollars of fraud currently happening in the NDIS that the government has done next to nothing to stop. We’ll be opposing this bill until the government can prove it is running the NDIS in a way that isn’t going to send the country broke. 

I’ll go back to my opening question from my first question: is this new legislation an admission that the NDIS has failed or that the government is letting it run completely out of control?

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The Bureaucrats are Out of Touch and Out of Control

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The public servants in the Canberra bureaucracy are meant to be impartial. Being impartial would mean they only comment on their ability to carry out laws, not whether they agree with policies ideologically. What we see again and again is that the bureaucrats are not impartial. They make submissions that support the woke policies of the Canberra elite, like net-zero.

I asked the Australian Public Service Commission (APSC), who are meant to be the enforcers of the code of impartiality, about one particularly bad example where an agency endorsed the government’s net-zero ideas. Their response? “Well that’s just your opinion.”

The Canberra public service and their referee are so out of touch with everyday Australians that they can’t even comprehend the question. It’s easy to see why Canberra was the only state or territory in all of Australia to vote Yes on the Voice.

Transcript

CHAIR: Senator Roberts.

Senator ROBERTS: Thank you for appearing again. The Australian Public Service works under or in accord with the code of conduct. Is that correct?

Dr de Brouwer: Yes.

Senator ROBERTS: How does that work in practice? I know that is a broad question.

Ms Talbot: As we alluded to earlier in our evidence, we have the APS Code of Conduct, and that sets out the standards and, I guess, the expectations on all public servants. In particular, the Public Service Act is quite clear around articulating what the APS values are and how they apply to all public servants. I can go into more detail around the code of conduct requirements if you wish.

Senator ROBERTS: Basically, the code drives behaviour or indicates the behaviour or values that are appropriate.

Ms Talbot: It sets out what the appropriate behaviours are, what the appropriate expected standards of conduct are, and it does outline the APS values and goes into some detail about those values.

Senator ROBERTS: So it is broad not specific because it doesn’t apply to just one department or one agency? It’s very broad.

Ms Talbot: It applies to everyone, but sitting underneath that there is quite a detailed document, and in particular sitting under the Public Service Act there are also commissioner’s directions, which go into more detail as well around how everything actually applies.

Senator ROBERTS: Can you elaborate on the Australian Public Service value of impartiality, specifically how the Public Service should be interpreting it practically in making submissions to inquiries?

Ms Talbot: Is there some specific inquiry?

Senator ROBERTS: My concern is that it seems some agencies aren’t being fully impartial in making submissions, especially in the area of climate policy, for example. This is dangerous because it leads to group think. My interpretation of the value of impartiality is that if an agency or department is making a submission on, for example, a law change, that submission should be limited to the agency’s ability to carry out the policy change. That might mean resource considerations and practical issues of whether they can enforce a policy. Is that what you would be expecting in a submission that meets those values of impartiality, rather than making a submission in favour of or against a policy on the basis of political aspects?

Ms Talbot: What I can say is that the guidance around impartiality is reminding public servants that in conducting their duties they are to be apolitical and they are obviously not to be biased in the way in which they conduct their duties. I think you’re asking me more for an opinion around a particular instance that you have in mind.

Senator ROBERTS: I’m concerned about several instances. It seems we have some agencies and departments making submissions that endorse the policies being put forward from an ideological standpoint, not only commenting on the practicalities of implementing the policy for that agency or department, as I said. For example, the Australian Energy Regulator made a submission to the national energy laws amendment bill. In that submission they endorsed the net zero policy setting of the government and said they support it, which doesn’t seem to be impartial. Shouldn’t they only be commenting on their ability to implement the changes, not endorsing the policy driving the changes?

Dr de Brouwer: The requirement of impartiality, as Ms Talbot outlined, is that the APS is apolitical. But it also provides advice—and I will quote from section 10(5) of the act—’that is frank, honest, timely and based on the best available evidence’. This is within the CER’s view of what is the best available evidence, what is coherent with that and what is required to achieve that.

Senator ROBERTS: So they would be informed by scientific evidence, would they?

Dr de Brouwer: That is what I think the CER will say. You should ask them.

Senator ROBERTS: You are smiling.

Dr de Brouwer: We used to deal with this in estimates 10 years ago.

Senator ROBERTS: Net zero policy is within climate policy. That’s subject to a lot of contention in the public, so supporting that would seem to me not to be upholding impartiality, especially when there have been no logical scientific points, including empirical scientific evidence, to back up net zero anyway in the world. They failed the science test, so surely they are acting partially?

Dr de Brouwer: I think that is your view, Senator Roberts, and it is up to that authority to explain how it views the evidence and provide the explanation to you of why it’s acting impartially.

Senator ROBERTS: Thank you very much.

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Government spending $2.4 billion on casuals with one Labour hire firm alone

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During investigations into the the abuse of casual coal miners I found that the government has spent over $2.4 billion on casual labour hire from one firm, Chandler Macleod Group, alone. The government couldn’t even tell me what the total casual labour hire bill was across all agencies because they don’t even collect that data. The fact that the Australian Public Service Commission don’t even know how much money they’re spending is inexcusable.

Transcript

Senator ROBERTS: Thank you, Chair, and thank you all for appearing today. When we were investigating, over the last 2½ years, the abuses of casual black-coal miners in the Hunter Valley, we noted that there were thousands of casuals working for the Australian Public Service, with hundreds of millions of dollars being paid to labour hire firms. Why does the Public Service do this?

Mr Woolcott : Could you just put that question to me again, Senator? I didn’t quite understand. You’re talking about why we employ casual hire?

Senator ROBERTS: Casuals. We know that some people prefer to work casually; so I’ve got nothing against casuals. We know that casuals fulfil a basic secondary role within any workplace, with fluctuating workloads, someone going on leave, projects et cetera. Why does the Public Service use so many labour hire firms to employ these casuals?

Mr Woolcott : It’s for agency heads to determine how they construct their workforce. The Public Service Act sets out that the normal method of engagement is full-time, ongoing employment as a public servant, but there are provisions in the Public Service Act for non-ongoing and other aspects. It’s very much for each individual agency head to work out what is the appropriate mix of their workforce. Obviously, if it’s work that fluctuates then it’s quite appropriate for them to use labour hire and casuals to manage those fluctuations. But again, as I say, it’s a matter for each individual agency head. They’re the accountable authority. They have responsibility for delivering for the government and the Australian community and it’s for them to work out their proper mix.

Senator ROBERTS: As the Australian Public Service Commission, I imagine you’d be interested in efficiency, cost-effectiveness and employees’ conditions?

Mr Woolcott : Obviously we’re intimately involved in many of those aspects but, in terms of running that agency and running the duties and obligations that they are committed to undertake, it’s for them to do that.

Senator ROBERTS: I get that point. How many casuals are currently employed across the Australian Public Service—hundreds, thousands, tens of thousands?

Mr Woolcott : I think it’s 87 per cent that is ongoing. Ms Steele will have the data.

Ms Steele : That’s correct. In terms of casuals in the last year, we have at the moment 8,696 casuals. That’s an increase of 51 since December 2020.

Senator ROBERTS: Thank you. How many of those would you know are casuals in their own right employed directly by the Australian Public Service and how many are labour hire subcontractors or labour hire firms?

Ms Steele : I do not know that. I do know that those who are employed for a specific term or task are a further 10,816.

Senator ROBERTS: In addition?

Ms Steele : In addition to the casuals. There are two types of non-ongoing. One is casual, and one is you can be engaged for a specific term or task.

Senator GALLAGHER: And that can be contract, labour hire, fixed term?

Ms Steele : Correct.

Senator ROBERTS: Thank you. How many casuals have been employed in the Australian Public Service for more than six months?

Ms Steele : I would have to take that on notice.

Senator ROBERTS: Could you, and could you also provide a de-identified report—anonymous employees—by department, by labour hire company or direct employment, by cost and duration of service?

Ms Steele : We don’t collect that information about labour hire firms or companies; we only collect the number of casuals by agency.

Senator ROBERTS: This one you’ll probably have to take on notice too, Ms Steele: how many casuals, internal or labour hire, have converted from casual to permanent employment in the Australian Public Service in the past 12 months?

Ms Steele : I will take that on notice.

Senator ROBERTS: Thank you. Are casuals that the Australian Public Service has engaged through labour hire companies able to convert to the Public Service roles that they’ve been working in for more than six months?

Ms Steele : No.

Senator ROBERTS: If someone has been engaged for more than six months it would seem that they’re needed, so why wouldn’t they be eligible? Because the employer is not the Public Service?

Mr Spaccavento : I think it’s important to draw a distinction between a casual employee and a labour hire employee. A casual employee is an employee of the Australian Public Service and is eligible to convert to permanent employment if they meet the criteria laid out in the Fair Work Act and the Public Service Act. A labour hire employee is an employee of an entirely different company and not of the Public Service. A labour hire employee would not be eligible to convert to permanent employment.

Senator ROBERTS: Do you see some inconsistency there?

Mr Spaccavento : No, because in one instance the employee is a direct employee of the Australian Public Service, directly engaged by an agency. So it’s a contract of service versus a contract for service.

Senator ROBERTS: I understand that. We’ve seen the abuse of coal miners, for example, and we’ve seen hints of abuse of casual workers in other sectors as well—lost entitlements, basic safety provisions, significant pay cuts—and it seems to me that it’s just a naked attempt to go around the provisions of the Fair Work Act.

Mr Spaccavento : Casual employees in the Australian Public Service are engaged under the terms and conditions of agency enterprise agreements, so they receive essentially the same terms and conditions as permanent employees. I say ‘essentially’ because there’s some leave entitlements they don’t get and there is a casual loading. Labour hire employees are obviously different because they are employees of a different organisation. There’s a range of reasons why agencies would engage labour hire firms, and that would be a decision for that agency head to make.

Senator ROBERTS: In the course of our investigations in the Hunter Valley, Central Queensland and elsewhere we found, for example, that the Chandler Macleod Group was paid an estimated $2.4 billion over four years for providing labour hire contractors or labour hire employees to the Australian government. That seems pretty substantial to me.

Mr Spaccavento : I can’t comment on decisions that agencies have made.

Senator ROBERTS: Are you aware if these casuals under labour hire firms are paid the same and have the same terms and conditions as similar roles that they work beside?

Mr Spaccavento : Because it’s outside of our remit, we don’t have visibility of what labour hire employees are paid or the conditions they are on. It would be a matter of the employment arrangements they have made with the labour hire company and those employees. I couldn’t say yes or no to that question because we don’t have responsibility or visibility of it.

Senator ROBERTS: Minister, this is a request for an opinion: do you think that’s reasonable?

Senator Duniam: In terms of the decisions that heads of agencies make around it?

Senator ROBERTS: The employment of people for more than six months by a labour hire firm could be a way of getting around the requirement now to offer casual conversion.

Senator Duniam: As the commissioner outlined earlier, heads of agencies make decisions with regard to how they engage their workforce based on the needs at the time. There are a range of circumstances that they obviously take into consideration. I would have every faith in those heads of agencies that they are doing the right thing to ensure that the people they work for, the taxpayers of Australia, are getting the service that’s required and that their employees are being treated properly as well.

Senator ROBERTS: With respect, that’s a nice motherhood statement, but I’ve seen people who work for firms with reputable international and Australian reputations completely abusing workers in this country. That has come as a big shock. To compound that, neither the Labor Party nor the Liberal Party nor the National Party nor state and federal governments nor the various bureaucrats have been interested in this. They’ve ignored requests to investigate.

Senator Duniam: If there are specific cases of abuse of employees then there are appropriate channels to deal with those things. I would encourage you, or those you ask these questions on behalf of, to take action, because that’s the appropriate thing to do. I don’t think there’s anyone around this table, on that side or this side, that would seek to endorse any abuse of employees or withdrawal or withholding of entitlements.

Senator ROBERTS: It’s remarkable—and I’m not accusing people of doing that in the Public Service—and I’m trying to find out whether or not the government and the Public Service understand there is a potential for that. We’ve seen that widely in other industries from so-called reputable firms. I’ve heard some stories about the Public Service hiring $2.4 billion worth of labour hire people over four years. That’s a staggering figure.

Senator Duniam: I appreciate you’re not making an accusation. Certainly, your point is that there could be potential, or you’re trying to seek an understanding of whether there is. If there is a single case of this abuse then I would expect that it would be raised and referred to the appropriate authorities and dealt with accordingly.

Senator ROBERTS: What doesn’t give me confidence—I accept what you’re saying—is that some people in the Hunter Valley, for example, raised this repeatedly over the course of about five years and got nowhere, neither from the state nor the federal government, with blatant breaches of the law. I’m just trying to understand, if the Public Service know that this could be going on, what they’re doing to protect not only workers who work for them permanently, casually, directly, but also those who work indirectly through labour hire firms, because not all labour hire firms are ethical.

Mr Woolcott : I’m not aware of the particular issues that you are raising. Obviously, if you have concerns, please take them up with the relevant minister or with his department in relation to the way they manage their affairs.

Senator ROBERTS: I’m trying to find out whether or not you’re aware of the particular—

Mr Woolcott : I’m not aware of any of the particular concerns that you’re raising, Senator.

Senator ROBERTS: Or the potential for that. Are you aware that casual workers who are employed either directly or through labour hire firms have less job security and find it harder, for example, to get home loans, because one of the requirements for a home loan is a secure, permanent job?

Mr Woolcott : Am I aware of that?

Senator ROBERTS: Yes.

Mr Woolcott : Again, it’s not an issue that’s been brought to my attention.

Senator ROBERTS: So you’re not aware; okay. These workers who are working for the Public Service for more than six months miss out on the terms and conditions of government employment. Is that reasonable?

Mr Woolcott : You’re asking me for an opinion there.

Senator ROBERTS: I’ll ask the minister.

Senator Duniam: With respect to the decisions made by heads of agency around how they engage their workforce, either in the way you’ve characterised or otherwise, as the commissioner has outlined, it’s a matter for them based on the needs of the community they serve and the work that they do. Personally, I would love to ensure that everyone gets everything they’re entitled to, and I have every expectation that, for those who are engaged, under whatever contractual arrangement occurs, those contracts are in alignment with the law and are done in accordance with what is legally required of the employing agency. My hope is that everyone gets what they deserve and nothing less.

Senator ROBERTS: That’s my hope, too. But in the Hunter Valley, for a period of seven years now—five years until we started working on it—there were many people who were abused and exploited, and they were told to go and talk with the state department, WorkCover. They were told to take it up with the federal government, and nothing happened. We were then actively misrepresented when we tried to do something about it. Eventually, we prevailed in some areas and we’re still working on others. So it could happen in the Public Service, and I’m checking to make sure that the Public Service is aware of some of these things; that’s all.

Senator Duniam: You have brought this concern to the commissioner’s attention. Certainly, the minister that I’m representing will be aware of your concerns. Again, if there’s a specific instance or a series of them, we should deal with them in the appropriate forum.

Senator ROBERTS: One final question, Chair: what margin is paid to labour hire firms when you engage a casual through them? I’m now putting on my other hat; instead of protecting constituents, I’m protecting taxpayers, who are also constituents. What’s the margin?

Mr Woolcott : We don’t keep data on that, so I can’t answer that question. It would be a matter for each particular agency head, in terms of the arrangements they have. We don’t collect data on that issue.

Senator AYRES: Ms Steele, I didn’t hear your answer to Senator Roberts’ initial question. I think you gave an answer—tell me if I’m wrong—which was about the number of direct casuals and the number of non-ongoing; and, consistent with the APSC’s previous answers to the committee, you don’t have an answer for the number of labour hire employees engaged by the APSC?

Ms Steele : That is correct.

Senator AYRES: The justification for what I think is an impossible proposition is still the same, Mr Woolcott, is it?

Mr Woolcott : We collect data on Australian public servants, and arrangements under the APS act fall outside our terms of reference. Having said that, Senator, it’s always appropriate to look at ways to improve data collection and our understanding of the public sector workforce. We will continue to do so, and use the COO committee to that end.

Senator AYRES: Does that mean that you’re heading towards being able to collect that data, to be able to identify what proportion of the workforce is privatised, or are you just making a general comment?

Mr Woolcott : I’m just making a general comment at this point, Senator.

Senator AYRES: So it’s still studied ignorance on labour hire. With the survey work that the commission does on a regular basis, there’s been no consideration given to extending that survey work to the experience that labour hire employees have with the Public Service?

Mr Woolcott : Not at this point.

Senato r ROBERTS: There’s no guarantee—you can’t provide a guarantee—that there’s no wage theft going on in the industry, in the public sector?

Mr Woolcott : No, I can’t provide that guarantee.

Senator Duniam: Again, it’s important to say that, if there are examples of that, I’ll walk with you to the appropriate authority; we’ll make sure that they’re made aware, that investigations occur and justice is done.

Mr Woolcott : The workforce ombudsman, Sandra Parker, obviously looks at this aspect very closely in terms of both the private sector and the public sector.

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