The Australian government has committed an additional $110.4 million to strengthen measures aimed at preventing fraud within the National Disability Insurance Scheme (NDIS).
The funding supplements an earlier allocation of $83.9 million, with the goal of enhancing the National Disability Insurance Agency’s (NDIA) ability to detect and address fraudulent activity within the program.
This funding is directed toward the Crack Down on Fraud program, which has been operational since February 2024.
The program has already introduced key system improvements, including enhanced identity verification for participants, more robust claims management processes, and advanced data analysis capabilities. These upgrades have allowed the NDIA to identify over 2,100 providers exhibiting questionable claiming behaviours.
Providers flagged by the new systems are required to undergo Manual Payment Reviews for all claims. Many of these providers are also subject to additional audits or legal proceedings.
To date, the program’s efforts have reportedly prevented over $400 million in fraudulent claims and contributed $200 million in cost savings for the scheme.
Bill Shorten, minister for the NDIS, emphasised the importance of continued efforts to safeguard the program.
“This program is progressively delivering a range of system uplifts that make it easier for participants and providers to get it right and much harder for them to get it wrong,” he said.
The additional investment will fund further system upgrades through 2025, building on the program’s collaboration with entities such as the NDIS Commission and the Australian Federal Police. These partnerships have facilitated the execution of search warrants at multiple properties, targeting businesses and providers suspected of misconduct.
Shorten reiterated the government’s resolve to protect NDIS participants.
“I want to ensure that criminals aren’t able to exploit the NDIS, rip off taxpayers and, most importantly, attempt to skim money off the hundreds of thousands of Australians who rely on the life-changing scheme. So, we will continue to invest in measures that will safeguard the scheme to ensure it’s around for generations,” he said.
Separately, the NDIS has implemented new rules governing how participants can use their funding, effective Oct. 3.
These changes are designed to clarify the types of supports covered under the scheme, with a one-year transition period to help participants and providers adjust to the updated guidelines.
Under the new framework, participants must use their funds exclusively for NDIS-approved supports.
Mistaken use of funds for non-approved items valued at less than $1,500 will not incur penalties for first or second infractions during the transition period. However, repeated errors or deliberate misuse will result in enforcement action, and purchases of illegal items will not be tolerated under any circumstances.
The reforms also introduce a mechanism for participants to request substitutions, allowing them to replace approved NDIS supports with alternative services. Substitution requests must demonstrate comparable outcomes and cost-effectiveness and require NDIA approval. If rejected, participants must wait 12 months before reapplying for the same substitution.
