The National Disability Insurance Scheme (NDIS), once heralded as a revolutionary initiative to empower Australians living with disabilities, has begun 2025 under intense scrutiny for systemic failures, rampant exploitation, and a troubling lack of oversight.
According to recent reports, the scope of fraudulent NDIS activity is believed to be as high as $8 billion annually, far exceeding the official government estimate of $2 billion.
James Willis of 2GB Sydney aptly summarised the situation, describing the scheme as “mindlessly complicated, terribly expensive, and lacking the guardrails to keep the system under control.”
The Fraud Fusion Taskforce, established to combat these issues, has reported alarming instances of overcharging and unscrupulous billing practices. Willis recounted stories of services being grossly overpriced under the scheme—items worth $80 being billed for hundreds of dollars, with payment errors amounting to 4% of total costs.
This mismanagement has created a fertile ground for exploitation by organised crime syndicates, businesses, and even individuals seeking to profit from the system.
The scale of fraud within the NDIS has become so vast and complex that police forces across Australia have been called in to assist with investigations. NDIS officials have privately briefed law enforcement about the potentially staggering $8 billion lost to fraud, in addition to billions more due to overcharging, with no clear way of quantifying the total losses.
To address the growing crisis, the NDIS investigators, alongside the Fraud Fusion Taskforce, reached out to all state police forces late last year, urging them to increase their efforts to crack down on fraudsters. They also highlighted the significant issue of overcharging, which continues to plague the system.
“There are the criminals who deliberately rip the NDIS off with blatant fraud,” said a police source. “But then there are the genuine providers who overcharge and embellish to the eyeballs, so something for $80 will cost $800 when the NDIS installs it.”
Despite the government’s efforts, including the introduction of new laws in 2023 making it illegal for NDIS providers to charge higher-than-market prices without justification, NDIS head of integrity John Dardo stated that the problem cannot be solved solely through prosecutions or audits.
The system’s fundamental weaknesses need to be addressed to prevent further exploitation.
While the government has touted its crackdown on fraud and stricter eligibility criteria as successes, these measures have also left many legitimate participants in distress. As James Willis highlighted, the unfortunate reality is that innocent families are being told their much-needed services are being cut due to systemic abuse by others.
The introduction of templated eligibility reassessment letters has become a particularly contentious issue. Participants are given just 28 days to provide evidence to maintain their eligibility, a process that has been described as cold, impersonal, and overwhelmingly bureaucratic.
Families are often left scrambling to gather the necessary documentation, with some resorting to paying out of pocket for additional assessments and reports.
One disability advocate, speaking to The Saturday Paper, explained the emotional toll of these reassessments, saying, “As soon as I started asking questions about what could be done, the [NDIS official] started auditing me… It was to the point that he had me in tears.”
Perhaps the most damning indictment of the NDIS is the treatment of children with disabilities. Recent reforms have targeted the so-called “early childhood approach,” resulting in an extraordinary uptick in the number of children being removed from the scheme.
Officials claim these children have “achieved their goals,” but critics argue this is far from the truth.
In many cases, the children being removed still require intensive support and therapy. Letters of rejection seen by The Saturday Paper admit as much, stating that their impairments remain significant but that the NDIS is no longer responsible for funding their support.
One family of a young girl with childhood apraxia of speech received a letter acknowledging her need for intensive therapy but shifting the responsibility to the underfunded public health system.
This shift has left countless families in limbo, as state and territory governments have systematically withdrawn services that might have supported these children. Now, with no alternative, these families are left to navigate an under-resourced and overstretched system.
The NDIS’s financial sustainability has been a growing concern since its inception. In its latest annual report, the National Disability Insurance Agency (NDIA) touted its achievements in moderating plan inflation and stabilising participant numbers.
However, these so-called successes have come at a high cost. Families have reported reductions in their annual funding and difficulties accessing services they once relied on.
The government’s focus on budget savings has raised serious questions about its priorities. For instance, the decision to triple the budget of the scheme’s eligibility branch to $16 million was made to support a wave of reassessments. Critics argue this shift prioritises financial metrics over the well-being of participants.
At its core, the NDIS was designed to provide dignity, support, and empowerment to Australians living with disabilities. Instead, it has devolved into a labyrinth of inefficiency and mismanagement. From fraud and overcharging to the exclusion of vulnerable participants, the scheme has failed to live up to its promises.
As James Willis so poignantly remarked, “We invited both participants and businesses to sign up for something without guardrails, without proper rules and restrictions… and now innocent families have to miss out.”
The NDIS is no longer just a flawed system – it is a shambles. With billions of dollars wasted, vulnerable Australians left without support, and a growing sense of public disillusionment, the scheme has reached a critical tipping point.
If swift and decisive action is not taken, the very people it was meant to serve will continue to bear the brunt of its failures.
The consistent lack of empathy by government in disability services, childcare, aged care etc., is a blight on them.
They make a lot of noise but achieve nothing but chaos and expense with everything they attempt to ‘give aid’ to.
It won’t be until those in charge of these vital decisions reach the age of needing help will they realise their mistake.
I have a g/niece who relied on Respite and now she has to go without and my sister can’t get a break which causes unhappiness in the house. Thank you to those selfish people how misused their funds now everybody else has to suffer.