The proposed NDIS overhaul marks a rare moment of substantive reform – and a test of whether the Albanese government is willing to follow through in the face of political pressure.
New National Disability Insurance Scheme reforms pose a novel test of character for the Albanese government. If form were any guide, it would be one which Albanese could be expected to fail, if only from fits of nervousness and secret lobbying from old cronies. But there are some grounds for optimism about the government suddenly getting its first flush of courage in four years of government with its proposals for reform of the National Disability Insurance Scheme. That’s in part because so far uncontainable annual growth means that the government must do something. And because the proposal is being steered by an unusually competent minister in Mark Butler, the minister for health. One can only hope his example will provide some momentum for wider change, and not only in the welfare sector.
Albanese and his press unit can, of course, claim hundreds of “reforms” and important announcements in four years of government. Many were dreamed up by advertising agents and media units and, like many of the Gillard announcements of 15 years ago, were dead in the water within a week. Many were oversold, involving only piecemeal change, and have made little difference to the lives of voters. Even some that were intended to make a difference, such as childcare reforms, have foundered as inflation has eaten away the investment.
The NDIS proposals differ greatly from other bits of tinkering with the status quo by the Albanese government. They will cause upset and anger among communities who deserve compassion and respect. The changes go beyond the foreshadowed fiddling with the entitlements of younger folk with developmental delays but into a new system which sees wide review of entitlements now to be based on degree of disability.
The plan is to shave existing entitlements going to 750,000 down to about 600,000 by 2030, which, given the unrestrained growth of the scheme may mean that 400,000 who might have expected to receive some benefits then will not.
It could foreshadow the same sort of review of other programs in health, education, aged care and childcare which the government ought not be avoiding. It might also, if Albanese had the guts to take on Richard Marles, minister for defence, extend to the primary source of government waste, incompetence and corruption, in defence.
But Butler is not focused on mere cost-cutting. He has been searching for governing principles and rationales, accepting that some of the flaws in the scheme were in the original design. These have been compounded by fraud, and rorts, and some crooked operators in a system too unregulated, but the malfeasance and misfeasance are only a secondary problem.
Most of those currently receiving NDIS benefits allowing them to live in dignity within the community will not have their entitlements threatened. People with permanent and major disabilities – 80 per cent or more – will not have things change much. The focus for change will be for those with developmental difficulties. These conditions are real too, and those who lose entitlements can be expected to make a fuss. It is a fuss for which Butler shows himself prepared and sympathetic, firm if not indifferent.
It’s Labor’s biggest (proposed) reform in its four years so far
You can tell it’s real by the sheer financial impact of the changes, if they are to succeed, the impacts on thousands of NDIS families, and the fundamental change of philosophy towards disability services they represent. You can tell by the fact that the changes will hurt many current NDIS recipients who have come to expect the services NDIS has been providing, however inefficiently and perhaps ineffectively.
A good many of the losers will be among the poorest and most dependent of Australians, and most will have been Labor voters. There will be strong pushback, with able and passionate advocates. This will include opposition by other political parties keen to take any opportunity to punish Labor, in this instance for winding back one of the only significant reforms of the past 15 years. That other governments – the Morrison government in particular – were earlier trying to wind back the NDIS because of its high annual growth in costs, and that their proposals for doing so were more cruel and arbitrary will be neither here nor there. That was in a different country.
Perhaps more significant is that the proposals emerge from an environment in which Labor’s sternest critics, mostly from within the government itself, have been depressed and distressed by the lack of guts and resolution in the Albanese cabinet. Labor, with its enormous majority in the House of Representatives and, generally a workable set of numbers in the Senate, has disappointed many traditional followers because of apparent fear of upsetting key lobbies, and losing its comfortable opinion poll lead over the combined oppositions.
As Butler is trying to sell it, the proposals may be about containing future costs, but do not involve running away from the NDIS concept. They are not simply “savings” served up for a budget bottom line, because sensible heads in government appreciate that the costs of disabilities are incurred anyway.
Likewise, the very commitment to real review rather than arbitrary cuts by an expenditure review committee may gird some others with gumption to do serious work on tax expenditure and other reforms.
If this is real reform, it’s against a background where the prime minister will not take on the gambling and liquor lobbies, media moguls, and the significant energy lobbies. Its devotion to causes which once marked it as a Labor Party, such as welfare rights, trade union rights, human rights and anti-discrimination action, the rights of minorities, immigrants, Indigenous Australians and people fleeing persecution abroad are neither championed or much respected.
Labor in action has been a consciously passive player in action to protect the environment and Aboriginal heritage. If slightly more progressive than the formal opposition on climate change and the transition from hydrocarbon energy sources, it has blithely defied the hopes and expectation of most voters, particularly younger voters, women and the more educated voters in building coal mines and coal power at the expense of renewables. Labor, and Albanese in particular, lacks the courage, the commitment and the guts, to take on the “Labor” government of Western Australia, a complete servant of the hydrocarbon industry and billionaire mining interests.
About half of those who give their preference to Labor ahead of the opposition wonder whether there is any point in voting Labor anymore. Some will compare the obstinacy and lack of ambition of an Albanese on significant ‘Labor’ issues and tax matters with an apparent willingness to cut into benefits going to the very vulnerable.
Staying the course is a real test of character for Labor
It might not seem a propitious time for Labor to determine to get involved in a serious battle, particularly one largely against its own constituents. Where it is able to be described as a meanie and mere cost cutter. It is not irrelevant that Labor is taking action against a significant piece of welfare expenditure, when it will hardly lift a finger against the middle class and the rich.
But it would be quite unfair to consider that its policy proposals are simply about punishing the poor, as some sort of performative act, a la Scott Morrison. The appeal, rather, is to reason and responsibility, putting disability services on a sustainable footing, and at worst to give Labor some credentials with which it can develop some other reforms, both in the welfare sector and in broader areas of government. Perhaps even the defence black hole.
The difference is not Albanese, who has yet to show any sign of a personality transplant or an infusion of courage. It is in part in the calibre of the minister, and in his commitment to staying the course. Butler is not trying to take the government off a cliff. He is supremely political, but he is not a cowardy custard.
Like Hawke or Keating before him, he is well aware that his proposals, once implemented, will hurt vulnerable people. He is not being hairy chested about it. His approach resembles that of Ralph Willis with 1990 workplace reforms – preferring a well thought out, comprehensive plan to incremental and fragmentary steps.
Butler’s pitch has been well prepared and well-rehearsed. He’s good at explaining. His selling points do not depend on slogans, or fine points of false distinction, on distinctions without differences, or distinctions appealing to dubious facts and preferences, of the sort relied upon by Albanese and half the Cabinet in normal explanation. Butler has not denied the obvious or impugned beneficiaries and has treated the players with respect. He recognises, as most ministers in this government do not, that the real “stakeholders” are beneficiaries and the public at large, not the provider lobbies. He will win only if there is a broad if reluctant consensus in the general community, and those to whom he will be appealing can be assumed to have a strong belief in the idea of an NDIS.
If the proposal fails, I expect that it will not be because he panicked, or because he failed to explain the economics and the rationale. But panic elsewhere in government, and the capacity of lobbyists to get into the prime ministerial ear, is something for which he will have to be alert. Butler has worked hard on journalists, health economists and others who are relatively neutral on the issues. He has engaged with commentators working in the disability field, but not to invite them to ignore the legitimate objections of the recipients, or the predictable complaints of some of the provider lobbies.
He has given the provider industry its well-deserved serve for rorts, fraud, corruption and inefficiency, but not pretended that this is the primary problem, as other reviews, and other politicians have suggested. Many in the provider industry will be needed in the new systems, even if under different masters.
Butler’s preparation for this reform is a rare model of good government process
Perhaps I am giving Mark Butler too big a wrap. I bet that if he fails it will be because he is undermined by his own side rather than defeated in battle. But the reason for a sudden surge of optimism is my feeling that what Butler is doing fits classic patterns of good government. Planning, preparation and internal debate, reshaping for better policy rather than moving straight to “better” politics, “selling points” and squaring off potential opponents, including those in competition for the same dollars. Being open to discussion, and willing to explain, including to people who are legitimately cross, anxious and apprehensive. Being willing to adapt proposals to fresh evidence and circumstances. Treating the class of recipients as the primary experts, but also according respect and deference to people who have been involved in the services for many years. Listening, not telling.
The odd thing is that many of these features existed in the lead-up to the original NDIS which owed much to the imagination and ambitions of the young Bill Shorten, as well as the then Productivity Commission. It was never a slogan looking for a set of clothes. It recognised that a good deal of its budget and operations could be made up from hundreds of different programs at federal, state and local government level, now better coordinated and with some focus on more uniformity of outcomes. The scheme did not anticipate the level of demand, nor, once the general excellence of many of its operations became apparent, the demand that it fostered. There were some working schemes here and abroad – one important model was the Home and Community Care system, designed to keep older Australians active in the community rather than languishing in care homes.
The NDIS is less than two decades old but has transformed care of disabled Australians in the community. It is very popular with ordinary Australians, who will watch efforts to change it with close attention.
I don’t know if Butler has the formula right yet, but I don’t see him simply trying to undermine the basic system. It is plain that services must be rationed, and that some people will either get more limited services or none. But I do think we must work hard to ensure that it remains an imaginative and necessary response to serious disability in the community, not a bothersome extra whose very existence is a standing affront to the better classes of Australian economists, especially in the Murdoch media.
Republished from The Canberra Times, 27 April 2026.
John Waterford AM, better known as Jack Waterford, is an Australian journalist and commentator.