NDIS: market policies no answer to crisis in disability

The introduction of the NDIS is being used to privatise services and drive down workers’ wages and conditions.

In Australia, almost one in five people has a disability. People with disabilities (PWD) are more likely to be homeless, unemployed, imprisoned and victims of physical and sexual abuse. 45 per cent live at or below the poverty line. There is a clear need to remedy this injustice.

This July marked the beginning of the full rollout of the National Disability Insurance Scheme (NDIS). Over the next three years 460,000 people who “have a permanent and significant disability” will enter the scheme, roughly 10 per cent of PWD. The scheme has been in operation in seven trial sites since 2013.

The NDIS has been hailed as “the most significant economic and social reform since the introduction of the original Medicare scheme.” PWD should receive significantly increased funding.

Under the NDIS, instead of state governments giving block funding to disability providers, the federal government will directly fund individuals with a disability. Disability providers will be forced to compete with each other for clients’ money.

This new individualised funding model is promoted as bringing “choice,” “control” and “empowerment”. These are long fought for principles of the disability rights movement and many PWD have welcomed the scheme. However the introduction of a competitive market into disability services is a huge problem.

Competitive market

The vast majority of disability providers are not-for-profit (NFP—employing 73 per cent of workers), alongside a smaller government sector (21 per cent) and a small for-profit sector (6 per cent). The NFPs receive most of their funding from government.

The introduction of a competitive market under the NDIS involves the entry of more for-profits and NFPs as state governments across Australia sell off public disability services.

In NSW 6000 disability workers who support 10,000 PWD are in the process of being transferred to the private and NFP sector.

Disability union HACSU is campaigning against Victorian Labor Premier Daniel Andrews’ decision to privatise public disability services, despite promising not to before the 2014 state election. This would put the futures of over 5000 support workers, 70 per cent of whom are women, and over 2600 PWD, in doubt.

Handing public services over to the free market is a disaster—as the privatisation of public transport, power, Telstra and TAFE education has shown.

Some for-profits will attempt to cherry-pick clients whose needs are cheapest and easiest to meet, leaving clients with more complex needs with little choice. These providers will have a perverse incentive to prevent clients from developing their own capacities, due to the loss of income any increased independence might bring.

And the National Disability Insurance Agency (NDIA), a statutory authority charged with administering the NDIS plans to “deregulate prices as the market matures.”

This is a recipe for price gouging, as is currently the practice in childcare, where increasing subsidies to consumers simply results in providers raising prices. This has been reported in some trial sites.

This could lead to PWD struggling to afford what they need, and increases in government funding simply lining the pockets of disability providers as they hike prices.

Workforce implications

Perhaps the greatest concern about the NDIS is the downward pressure on pay and conditions that will result from the marketisation of the sector, along with the expected doubling of the disability workforce.

The current funding allocations for the NDIS are not nearly enough to provide good quality care by well trained workers. The basic unit price for services, what the NDIA calls the “efficient price,” isn’t enough for employers to comply with the award, let alone EBAs.

The current hourly rate of $42 does not factor in time required for training, meetings and paperwork. Without a significant increase in the unit price many providers will be forced to shut down or hire unqualified workers who will accept substandard pay and conditions.

Disability providers are already applying to the Fair Work Commission to amend the award to cut penalties and reduce minimum shifts.

And the pressures of a competitive market will threaten wages and conditions, in a sector which is already poorly paid and highly casualised.

This is what has been happening in some trial sites. The peak body for NFPs described the experience in the Victorian trial site as bringing: “increased demands of staff, less ability to offer training and professional development, weaker supervision [and] increasing workplace health and safety risks.”

Researchers from RMIT have written that the regional manager of one large service provider told them, “we are losing staff to other industries … Some have gone to aged care facilities, the pay is lower but they’re going for the security”.

Inadequate funding combined with the pressure to provide only the services PWD want has created major difficulties.

“Another executive manager of an organisation providing home-based services told us: ‘(t)here have already been lots of one hour shifts, lots of travel time. We’ve got staff working 15 hours to get 8 hours’ pay, and they’re running their own vehicles… We try and have shifts backing on to each other but it’s not always do-able.’”

There is currently no qualifications requirement for direct support workers in the disability sector, despite 80 per cent of the workforce having a Certificate III or IV. With a doubling of the disability workforce the quality of training and care will deteriorate.

Government-run disability services are the ones that can afford to provide the best training, pay and conditions for staff. In Victoria, through strong union organisation, DHHS workers have won pay 30 per cent higher than in the non-government sector. The public sector is also where the number of casuals is lowest and workers with the most experience are concentrated. But they now face privatisation.

Other service providers say they won’t be able to afford to provide on the job training under the NDIS. Disability providers are also replacing permanent staff with casuals to give them greater flexibility in the more insecure funding environment.

NDIS participants are being encouraged to self-manage their budgets and directly employ carers as independent contractors. This denies workers their traditional workplace rights and further undercuts EBAs and the award.

A number of Uber-style internet-based businesses are starting up that link consumers with support workers. They are bound to undercut other providers on pay and staff qualifications.

The disability sector already loses experienced and highly qualified staff because of poor pay and conditions. This is likely to get worse under the NDIS.

According to HACSU, over half of DHHS staff indicated in a Reachtel survey that they would leave the sector if their pay was cut.

So despite the fanfare about the NDIS enhancing consumer choice, there may actually be less choice for PWD about who works with them, as experienced, qualified people look elsewhere for better paid, secure work.

Union response

Union coverage in the disability sector is low. If workers are to defend their pay and conditions, and improve quality of care, we have to unionise current workers who are anxious about the NDIS as well as the tens of thousands of new workers who will be required.

Unions are campaigning for mandatory minimum qualifications under the NDIS. But given the expected increase in the workforce, it is difficult to see how this can be won without a serious industrial campaign.

Unions should be campaigning for paid training for all current and new workers in the sector. Currently staff undertaking training must work 120 hours unpaid to get qualified, a serious obstacle to upskilling for workers who can’t afford to do unpaid work.

Unions are also lobbying against privatisations, for tighter regulation and more NDIS funding. But the whole neo-liberal premise of the NDIS needs to be challenged.

Market failures

Contrary to the hype around the NDIS, the market won’t deliver better services or enhanced choice and control to PWD.

It would be far simpler for the government to use the assessments the NDIA is making of people’s needs to provide the goods and services itself.

There are widespread hopes the NDIS can increase workforce participation for PWD and their carers. Australia is ranked 21st out of 29 OECD countries for employment of PWD and is at the bottom for incomes for PWD.

Discrimination is legal if the employer can prove that making adjustments to hire the employee would cause “unjustifiable hardship.”

The NDIS may increase the supply of workers with disabilities on the labour market, but due to the systematic discrimination they face from employers and the extra costs associated with employing them, there is no reason why employment rates will automatically increase. That would require serious intervention in the market.

Another clear area where the market can’t deliver is the acute shortage of affordable housing.

By enabling PWD to live independently in the community for the first time it is estimated the NDIS will create additional demand for affordable housing for between 83,000 and 122,000 participants.

The NDIS will fund home modifications as well as supported accommodation, but will do nothing to fund the affordable housing many people need. This means PWD will remain on long waiting lists for public housing. The answer is obvious—governments need to properly fund public housing.

What we need is a fully public and well-resourced disability support system.

PWD have additional needs. But they would also benefit enormously from comprehensive services that benefit everyone in education; expanded, free public transport; universal healthcare; liveable welfare payments; and investment in public housing.

Employers and the government will have to be forced to meet the needs of PWD and the wider community. To win justice for PWD we need to fight for a world that works for human need not profits.


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