During recent Estimates, NDIS Integrity Chief, Mr. John Dardo, stated that 90% of plan managers showed significant signs of fraud, and 87% of service providers were unregistered and unmonitored, lacking adequate training for their responsibilities. Mr Dardo said, “we have no idea what they do when putting in their invoices.” This underscores the broken state of the NDIS, stemming from an ill-considered election promise devoid of data, reminiscent of the Gillard government’s hasty policy announcements without sufficient planning.
I proposed that an inquiry should evaluate the merits of returning responsibility for these services back to the states from which they originated. I pointed out that an unintended consequence has been a shortage of workers in the health and aged care sectors due to the excessively high pay NDIS service providers receive—often triple what they would earn in equivalent roles within these sectors.
Labor’s penchant for wasteful spending was exemplified by the squandering of $430 million on “the Voice,” funds that could have been more effectively allocated to NDIS services.
Ultimately, taxpayers foot the bill for this waste. I advocate for a shift away from the costly and ineffective centralised service model towards competitive federalism.
Transcript
At the recent Senate estimates hearings, the NDIS integrity chief, Mr John Dardo, admirably confirmed that 90 per cent of plan managers displayed significant indicators of fraud. The level of fraud it is now so high that there are dozens of examples of organised crime groups abusing the systems, with millions of dollars being rorted. The system is so out of control that 87 per cent of service providers are unregistered and unmonitored. I quote words that appeared in an article about Mr Dardo:
We have no idea of knowing what they do when they put in their invoices.
It’s taxpayers’ money, spent on something they have no idea of. He had the courage to admit that. He said that existing cases exceeded Australia’s judicial capacity, without finding more.
NDIS funds must not be used to pay for sex workers, expensive holidays or new cars that other taxpayers cannot afford. Projections are for a blowout of NDIS spending to $90 billion within a decade; it must be prevented. Using the system to peddle drugs is happening extensively. The name of this bill says what we already know about the NDIS. It’s broken and getting worse. It’s a licence for criminals and fraudsters to print money. It’s so far off track that the hope that this bill will get things back on track is a pigs-can-fly pipedream.
Since the Gillard Labor government’s NDIS inception, there has never been a track. It was hatched with no meaningful metrics or plan. It was simply an election slogan to desperately buy votes in an election that Prime Minister Gillard lost. It was hatched as a headline grabber and a vote harvester. Typical of ‘uniparty’ initiatives—and of policies and legislation in our parliament over recent decades—it lacks the discipline of a system based on hard data and a focus on customer needs. It was done to look good, not to do good. A hastily cobbled together election policy, it had holes in it a mile wide that clearly enabled fraudulent claims to be made with little chance of being picked up and stopped.
As servants to the people of Queensland and Australia, Senator Pauline Hanson and I have been calling out the NDIS fraud model since 2016. A significant effort is now needed to remove dodgy plan managers and service providers and to protect capable and honest plan managers and providers, using stricter laws to prevent participants from being defrauded, to prevent unscrupulous service providers from abusing vulnerable people and to save NDIS for genuinely disabled people with real needs. If we really care, we’ll clean up this mess. If we really care for disabled people, then we’ll have to get tough and sort out the criminals and the rorters. Providers, managers and recipients who commit fraud under this NDIS scheme must be heavily penalised and banned from any involvement in the scheme again. Wasted money through overspending has cost taxpayers well in excess of $8 billion already, and it’s essential to ensure that the current 150,000 unregistered care or service providers become registered and then are monitored for effective compliance.
The Gillard Labor government introduced the NDIS. In their election loss, they handed the incoming coalition government an illegitimate, loose and sloppy mishmash of slogans and empty titles, lacking discipline, coherence, focus and care, and lacking solid systems. If they’d cared, Labor would have put together a proper system, but they didn’t. They should have put together a system to provide effective care and to protect taxpayers’ hard-earned money. The Liberal and National parties tried to refine the monster, and now the NDIS is back in Labor hands for more mismanagement. The NDIS must be reconsidered and protections against mismanagement and abuse strengthened.
But who should be responsible for management? References to the non-constitutional National Cabinet are just a poor joke. National Cabinet is a mere grouping of state ministers responsible for similar portfolios, with no statutory authority or constitutional recognition of its existence or authority. It’s toothless—all mouth and no accountability. There’s no accountability in the current system. Right at the very top there’s the bogus unconstitutional National Cabinet. In such cabinets the state and federal government ministers just go, ‘They’re responsible.’ That means no-one is responsible. There is no accountability. It’s fundamentally structurally flawed.
I suggest an inquiry to consider the alternative model: putting the responsibility for providing for the needs of people living with a disability back to the states and territories, where it was stolen from. Clearly, each state is responsible. The states would work to ensure that services were monitored, reasonable and meeting client needs under a model reflecting the proven benefits of competitive federalism, the foundation under which our Constitution and government is made. This will provide the level of accountability that has been missing to date. Centralising doesn’t work; decentralising closer to the surface does. One of the unintended consequences of Labor’s mismanagement of NDIS funds is the shortage of aged-care and healthcare workers who migrated to work in the lucrative NDIS model. This is because NDIS wages are so overinflated that a worker can receive three times the rate of pay for the same work done in other sectors. This is not just hurting the NDIS. This rorting, mismanagement and waste of taxpayer funds is hurting aged-care and healthcare workers.
Labor wastes money in other areas, too. Look at the wasted $430 million plus that the doomed referendum cost Australians—just like the Gillard government’s NDIS facade, which was based on slogans and empty promises lacking substance. Just think how that $430 million could have been spent directly to improve the lives of remote Australians living in need or spent on improving NDIS services and security for people who are disabled in some way. Then there are the follies of government cutbacks, such as when psychological services were cut from 20 appointments to a relatively useless 10 appointments for needy participants. Just think about what could have been supported with the wasted money—health, education and child protection are a few. Frontline staff are in short supply now, partly because of poor pay, inadequate training and lack of support and partly because of NDIS rorts and sloppiness. Many NDIS carers and support staff have little or no training in basic personal caring skills. Many recipients have physical health needs and their carers should have sound skills in lifting, mobility, feeding, toileting and showering. Expecting NDIS carers to do these things with no, or inadequate, training is unfair and dangerous for the recipient and the carer.
I have described a support system in crisis. This bill tinkers around the edges. As it is, this bill will not make significant positive differences, and who pays for all of this waste? Always, it’s we the people. Instead of tinkering around the edges of a broken system, do the work! I call on the government to do the work to define disabled people’s needs for service and taxpayers’ needs for protection. Instead of the ubiquitous fraud under low levels of accountability, consider returning to the original system of state governance. One Nation knows what history repeatedly proves: administration and services are of higher quality when services are closer to recipients. That enables understanding of needs, which is core to effective service. Replacing centralisation with competitive federalism provides a marketplace in governance. That’s what we all want. That’s what we need because improved governance provides accountability, effective service and better care.
At the recent estimates in June, the head of the Fraud Investigations Unit revealed that the volume of fraud cases reaching the courts is so high that the country’s judiciary is overwhelmed. This significant issue is driving up the cost of services.
I then enquired about the services provided to individuals with autism and was told that there are 200,000 people on the program with autism as their primary diagnosis.
No commitment was made to increase allowances for care providers.
Transcripts | Part 1
Senator ROBERTS: Thank you, Chair. Thank you to witnesses for being here today. We have been receiving a lot of phone calls and emails from constituents about the NDIA and the NDIS. What’s the fundamental need for having an NDIA and an NDIS as separate agencies? While they have different functions, the functions of NDIA and NDIS could be combined, doing away with a whole department and host of bureaucracies currently costing the taxpayer millions of dollars. It’s confusing to people. Could you please explain them?
Ms Falkingham: Yes, Senator. We have a scheme that’s set out under the act. There is only one agency, which is the National Disability Insurance Agency. We also have a commission. That might be what you’re referring to—the National Quality and Safeguards Commission. But the NDIS is not an agency, it’s not an entity of any type; it’s a scheme.
Senator ROBERTS: Why are people so confused about it?
Ms Falkingham: I think that over the course of the last 11 years we haven’t necessarily done the greatest job of explaining and communicating about the scheme—who it’s for, who it’s not for, what type of supports you can get on the NDIS and what supports you can get from outside the NDIS. Some of the confusion you might be speaking about goes to whether people have got an issue with their provider. If they have an issue with their provider, often it’s the National Quality and Safeguards Commission that they can make a complaint to, if it’s a registered provider. But, obviously, we also have things called local area coordinators. That’s a partnership we have with the community sector, which is often when people go in the first instance to speak to someone about getting onto the scheme. There are a lot of people involved in this scheme. One of the review’s recommendations is to really streamline that and have this concept of a navigator, and so we can start to have one person walk with a person with disability in an end-to-end kind of way along the planning process.
Senator ROBERTS: What’s being done in relation to auditing agency service providers who are sucking the scheme dry through fraudulent claims for services overcharged or not actually even provided?
Ms Falkingham: It’s an excellent question. I might ask John Dardo to come to the table. He can take you through all the work we’re doing on our crackdown on fraud.
Mr Dardo: I’m the deputy CEO and I look after contact centres and the integrity functions as well.
Senator ROBERTS: Sorry, what are the functions?
Mr Dardo: The Integrity functions—things like compliance, fraud and integrity checks.
Senator ROBERTS: Thank you.
Mr Dardo: Before I give a bit of a summary about the work that we’re doing, there are a couple of things that are really important to note. The No. 1 priority we have when we do integrity work is to make sure that participants’ safety is looked after. As we talk about the stuff today, it’ll be easy for some people to assume that participant safety is not the No. 1 thing we do, but participant safety is actually the most critical thing we do as we do our integrity work. As we do that integrity work, obviously we also look at things like sustainability of the scheme and making sure that the community can have confidence that people are getting the right services from the right providers. If we do it well, we get a level playing field for the providers, because the good providers can compete on a level playing field; they don’t have to compete against dodgy providers. The work we’re doing has lots of layers. There is a lot of work that we doing to identify, with intelligence, the providers or the things that are bad for the scheme. As we do that work, we’re working with other agencies to build layers of defence. That is because there is no silver bullet to getting integrity right within the scheme. One thing that we have is the Fraud Fusion Taskforce. It’s now 19 agencies.
Senator ROBERTS: The what taskforce?
Mr Dardo: It’s the Fraud Fusion Taskforce. There are 19 government agencies. It includes us, Services Australia—we co-chair it—the tax office, Attorney-General’s, the Australian Criminal Intelligence Commission, and a raft of other delivery agencies that do government payments and programs, such as Education, Employment and Workplace Relations, ASQA, who look after registered training organisations, professional standards that look after the quality of the medical professionals, Health and Ageing—there are a lot of agencies involved. The reason we partner with those agencies is that the people that are doing the worst things against the scheme and the worst things against participants don’t just work against the NDIS; they rort other systems as well. They rort the tax system, the Medicare system or the VET, vocational education and training, system. The patterns they use to defraud the scheme are similar across those systems. So, when we work with the other agencies, we’re more likely to detect those people, and we’re building a preventive architecture that doesn’t just stop fraud against the NDIS; it is also reusable to stop fraud against Medicare, vocational education and training, family day care or child care. So that taskforce is going brilliantly. It has a regular rhythm. We do a lot of work together to develop intelligence. We have intelligence alerts that come out to all the relevant agencies about providers or schemes that seek to defraud. We then act on those to stop payments or we work with the commission, who are also on the taskforce, to prevent bad players from being registered providers. In some cases, we do operations together. ASQA, the guys that look after registered training organisations, only came on board in the last month or so. Within a week or two of coming on board, we worked with them, and the tax office provided some support and the commission provided support, and warrants were executed on a provider that was problematic. So we work together really well.
Senator ROBERTS: How many service providers have been charged for falsely claiming fees for services not provided?
Mr Dardo: There are many, many dozens. Right now, there are approximately 20 prosecutions in progress, as in right in front of the courts right now.
Senator ROBERTS: That’s across Australia?
Mr Dardo: Yes. There are also several that are imminent. The affidavits have been produced. The work has been done with law enforcement. It’s been done with CDPP to result in either search warrants or charges. So there are more in the pipeline that are imminent. In addition to that, we’ve got to keep in mind that prosecution is the last resort. What we want to do is build a scheme where they can’t even get to the point of doing dodgy claims.
Senator ROBERTS: What I have seen and what I’ve concluded is that the NDIS was started as an election promise, it was cobbled together and flung out there—it wasn’t ready to go—and as a result there have been two things. Initially, there was a lot of corruption because the systems were loose, which is understandable, and then, as they tightened up, some people were missing out on services. Could you give me on notice, please, since the inception of the NDIS, the number of people charged for falsely claiming fees for services not provided, on an annual basis. I’d like to see if there’s a trend—if there’s a pick-up or a decrease. I mentioned the fact that, when you have a trend, it may be due to better enforcement or due to more—
Mr Dardo: Keep in mind the charges that are laid aren’t phrased exactly the way you described them, but certainly we can give you, on notice, the trend. What I will say is we are detecting now more than we could ever detect before, because the systems were not mature. They have been matured as we invest more in building more mature systems. For example, certainly in the last six to eight years, payments would be going out the door, and there were some periods through the day or through a weekend where payments were being processed with no NDIA eyes, or human eyes, looking at those payments. So payments were walking out the door without any system knowing that the payments were going out the door, because the systems were not mature enough or built in a way to prevent those payments.
Senator ROBERTS: We all know that the minister has been talking a lot about tightening up because ultimately the cost is getting out of control. What that means is that people who deserve good care don’t get it. So, by holding back the fraudsters, we’re protecting people to ensure they get their care in the future.
Mr Dardo: Absolutely. To give you examples, there are the prosecutions, but, even more important than that, in terms of the volume of the response that we’re implementing at the moment, there are the stoppers. There’s the stopping of payments where the providers are problematic or the claims are problematic.
Senator ROBERTS: So you’re making them jump through more hoops?
Mr Dardo: We’re stopping the claims, and we’re saying, ‘We’re not confident that this claim is legitimate; you need to provide evidence that it’s legitimate.’ In some of our stopper work, we’re hitting 50 to 87 per cent stop rates on claims. We have providers that have put claims in. We’re saying, ‘Sorry; that doesn’t look quite right,’ and they’re either withdrawing or cancelling their claims, or not responding at all—they’re walking away completely, and in some cases they’re shutting down their businesses and walking away because they’ve realised the game is up. And we’re not talking at the margins for these claims. Some of these claims are in the hundreds of thousands of dollars—
Senator ROBERTS: We’ve heard about them.
Mr Dardo: or in the millions of dollars. Our ability to now detect it is allowing us to stop it before it goes out. If we can stop it before it goes out, we then don’t have to try and recover the money or raise a debt to recover the money. We need to get better at stopping it. Before they even exist to make the claim, we need to get better at bringing that further forward in the supply chain. As we look at many of these claims and many of these providers, what we’re seeing is that the behaviours have been going on for years. It’s just that we’re better now at seeing them and preventing or stopping them. It is generating some angst, and I’ll describe that in more detail. There are providers that have been really bad in setting up their business model to take funds out of the system, with an understanding with participants or nominees that they would provide a certain set of services which maybe should not have been provided by the NDIS, whether it be rent subsidies, alcohol or other lifestyle expenses, gift vouchers or gift cards. The participants or their nominees have grown accustomed to a standard of living—they may have signed leases on the understanding that that was the lifestyle they would enjoy—and we’re now identifying that those providers are problematic, and we’re saying, ‘Sorry; you can’t keep claiming that money to subsidise that type of spend.’ You can imagine that some of our participants are having their standard of living disrupted.
Senator ROBERTS: That is a recurring theme in some of the questions constituents put to us—that genuine care is not being considered but lifestyle choices are, and so money is going on that. This is another one that’s recurring: when will families or friends supporting a person with high-level needs be appropriately supported? They’re not adequately supported, but care providers are being overly supported.
Mr Dardo: There are certainly some really black-and-white spaces. There are providers that are just providers—they’re brilliant and they’re awesome, and what they do is fantastic. There are some providers that have a mixed business model—they do some good work, but they do a whole bunch of dodgy stuff to supplement their income, their lifestyle or their business. There are some providers that are really just fraudsters, criminals or criminal syndicates, and they’re using the NDIS for cash flow. There are some participants and providers that are the same thing. We have participants who have set up businesses to pay themselves to look after themselves, or nominees who have set up businesses to look after their kids. We have examples of cases where it’s not clear that it’s a provider or a participant or a nominee, because it’s all intermingled. The family group has set up three entities, and they’re paying each other to look after each other, or a mother has drawn down $100,000 a year as an income to pay herself for looking after her child with disability. There are some things there that are very intermingled between a provider and a participant. The conflicts of interest are pretty extreme. Then you have participants who have not understood what they can and can’t agree to with a provider, so they’re accepting things that they shouldn’t be. Examples just in the last week: a $20,000 holiday, a $10,000 holiday. There are participants who are claiming things that they shouldn’t and in the past would probably not have been detected. We had a participant that bought a car, brand new, for $73,000. The money was processed overnight. Fortunately, when we were able to approach them, they understood that they shouldn’t have done that and they were willing to repay the money. We have other participants who haven’t understood what they should be claiming and when we approach them they cease contact and refuse to engage. Then there are the vast majority of participants that are trying to do the right thing, and we have to figure out how we get the balance right so that we help the people who are trying to do the right thing get it right more often. For the providers that are doing an awesome job, we need to help them survive and flourish. For the ones that are running mixed businesses, we need to exit them from the scheme, and, for the providers that are dodgy, we need to exit them from all government services, not just the scheme—we need to exit them from Medicare, AHPRA and everything else that they’re involved with.
CHAIR: Senator, this will need to be the last question.
Senator ROBERTS: Can you give us the number of providers per year, for the last five years, who have been exited from the system please.
Mr Dardo: We can. There are some different metrics there, but we can see what we can get for you.
Senator ROBERTS: It sounds like the agency is waking up to what’s happening, so thank you.
Transcript | Part 2
Senator ROBERTS: Before I continue with my questions—I think they will be to Ms Falkingham—Mr Dardo, I want to say I appreciate your candid nature and your openness. I’ve rarely seen someone in your position who, when confronted with a senator telling them about a problem, says: ‘That’s not the end of it. It’s worse than that, actually.’ It’s only by us understanding it and what you’re doing that we can help you. Thank you. I appreciate that. Ms Falkingham, why have many persons with autism or on the spectrum had their services cut, often with little explanation provided?
Ms Falkingham: I am not aware of any evidence to support that claim. I will get the scheme actuary up and he can talk about the amount of money we invest in participants with autism.
Mr Gifford: I don’t have the precise figure with me but I believe it would be more than 200,000 participants in the scheme who have autism as their primary disability. There’s no data that would suggest that people with autism are having their services cut. The growth in plans of participants with autism is different to the scheme population more broadly.
Senator ROBERTS: What’s the plan to support older people currently receiving a support package that far exceeds the age pension yet their package will cease when they reach retirement age? Their needs will not diminish and may become more acute yet their support will be slashed.
Ms Falkingham: It might be a question for our colleagues in DSS. The NDIS review has made a number of recommendations in relation to the interface between aged care and NDIS, so we can absolutely do better for ensuring that people are receiving that continuity of support if they have been on the NDIS, which we do now for people under 65. The NDIS review has made a recommendation around the interface and how we can improve upon that, but I will check if my colleague wants to add to that.
Mr Griggs: If you qualify before you’re 65, you don’t come off the scheme at 65.
Senator ROBERTS: What happens? When they go on the pension, don’t they come off the scheme?
Mr Griggs: No.
Senator ROBERTS: Not at all?
Mr Griggs: No, not if you qualified before 65.
Senator ROBERTS: Remember, these are coming from a lot of our constituents via emails and personal calls. Are you aware of clients who own their own home being pressured to sell their own home by the service providers to move to group care?
Ms Falkingham: I will check whether Deputy CEO Penelope McKay has any evidence. I do hear that anecdotally, but I’m not aware of whether we have any current cases. We can take that on notice for you.
Senator ROBERTS: Why is the focus seemingly moving away from providing support based on practical needs like assistance with cooking, cleaning, showering and hygiene to non-essential services that are routinely overcharged? We’ve heard stories of fishing and so on. Is there a switch there from genuine need to—
Ms Falkingham: Every decision we make is based on reasonable and necessary. The things you have outlined are absolutely the core of the scheme in terms of daily living and supporting daily living expenses, so I’m not sure. We can follow up for you, but some people will have goals in their plans that go to recreational goals and achievements, so obviously we will try to support a participant to achieve that goal by providing appropriate disability supports to enable them to do that. But things like building capacity, that’s what you’re speaking about in relation to cooking and cleaning and supporting people to live a good life. They are the core of our scheme and that’s predominantly what we fund now.
Senator ROBERTS: We’ve heard from constituents saying they have someone who will take them fishing but he comes in, does a quick look around—that’s a welfare check—and leaves. Is that the kind of thing some people are paying for?
Ms Falkingham: If you have evidence of that, I’m really happy to follow that up.
Senator ROBERTS: Why do agency service providers apparently get priority to receive payment over actual care givers who do massive amounts of unpaid work? In other words, personal care givers, family, do a massive amount of work and don’t get paid but agency service providers do.
Ms Falkingham: Obviously informal supports are a critical part of someone’s life and it is one of the things we discuss as part of the planning process. We fund paid supports under the scheme, but informal supports will always be a critical part of our community, and having family to be able to support loved ones is a really critical part of that. We obviously always provide respite services for families as well, who do provide a lot of informal supports, but that is the nature of our scheme. It is what we are funding under the NDIS.
Senator ROBERTS: Why is the carers allowance so pitifully small relative to paid agencies when many carers provide ongoing personal support 24 hours per day all year?
Ms Falkingham: I think that might be a question for DSS.
Mr Griggs: Carers allowance is part of the social security system. It’s not part of the NDIS. We can talk about that tomorrow in outcome 1 of DSS, when my team will be here, and they can take you through that.
Senator ROBERTS: When will care providers be remunerated appropriately because they put in more needed work hours than agency service providers? We’ll talk about that tomorrow.
https://img.youtube.com/vi/4iP2O7jiyyw/maxresdefault.jpg7201280Senator Malcolm Robertshttps://www.malcolmrobertsqld.com.au/wp-content/uploads/2020/04/One-Nation-Logo1-300x150.pngSenator Malcolm Roberts2024-06-28 17:37:042024-09-11 17:38:08Fraud is Overwhelming in the NDIS Sector
My questions to the NDIS Quality & Safeguards Commissioner was primarily about the quality and safety issues that render the system inefficient and hazardous.
It became evident that fraud was rampant, leading to significant financial waste and leaving many recipients’ needs unmet.
While some recipients received excessively extravagant packages with overvalued components, such as massages, fishing trips and cruises, others remained in dire need of basic assistance for eating, washing, toileting and dressing.
Initially, the system functioned fairly well, but it has now expanded excessively, resulting in waste, unmet needs, and dangerous conditions for vulnerable recipients.
