NDIS expenditures are projected to rise to $64 billion by 2029.
Despite the workforce’s move to manage the costs of Australia’s National Disability Insurance System (NDIS), the program remains one of the most expensive programs on a federal budget that goes beyond both defence and education.
NDIS is a taxpayer funding program created by workers in 2013, aimed at covering the costs of disability services and products for Australians.
But one concern is that it covers a wide range of areas and some recipients receive services supported by a wide range of taxpayers, from mowing the lawn to cleaning the home. Additionally, it is expected that the number of recipients will also climb.
As a result, the cost of the programme skyrocketed, with the Albanese Labour Government vowing to take control of it.
Current budget figures predict that by the next fiscal year, NDIS costs will be $52 billion, with over $51 billion allocated to defense by 2025-26, with $31.1 billion set aside for federal education initiatives.
This year it will be $48.5 billion.
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According to budget estimates, NDIS expenditure recorded the second highest annual growth among government major spending, tracking interest-only payments only.
Not only this, NDIS spending is projected to rise to $63.6 billion between 2028 and 2029, further increasing the gap between IT and other key budget items. By the end of the decade, defense spending is projected to reach $61 billion.
Graham Young, executive director of the Australian Institute of Progress, criticizes the projected growth of its spending.
“How about this increase?” he asked. “Are you expecting an increase in cases with disabilities? Will fraudsters exploit new loopholes?
Policy changes and ongoing challenges
To curb costs rising, the federal government introduced reforms last year aimed at achieving NDIS growth of 8% between 2026 and 2027.
The latest actuary report shows that the decline in growth rate fell to 8.4% between 2025 and 2026, down from 12% this year.
Treasurer Jim Chalmers defended the administration of the government’s scheme at its budget address, stating that “structural improvements” had been made.
The government also acknowledged that fraud within the scheme costs taxpayers $2 billion a year.
NDIS Fraud Fusion Taskforce has launched over 500 investigations and has referred 50 individuals to court.
Meanwhile, the NDIS Quality and Safeguards Committee has implemented over 2,000 compliance actions, including rejecting more than 1,200 provider registration applications.
Political reactions and economic concerns
The surge in costs have sparked criticism from the opposition, with Shadow Finance Minister Jane Hume arguing that the program remains “out of control.”
“NDIS was growing at 14% a year,” Hume told Sky News on March 23rd.
“Now when we were against it, the coalition told the government that we could work with them to keep our spending down and control it.
When asked about the Union’s specific cost reduction targets, Hume declined to name the numbers, but said spending should match the economic growth rate.
Chalmers opposed this approach, claiming that limiting NDIS funding to GDP growth to just 1.3% would lead to “mass reductions” in disability support.
“That’s a very scary proposition,” Chalmers said.
NDIS is also the creator of major jobs.
