Will the three-tier NDIS system be abolished?

Posted 8 months ago by David McManus
Minister Bill Shorten named Professor Bruce Bonyhady AM and Ms Lisa Paul AO PSM as co-chairs of the NDIS review panel in 2022. [Source: Twitter]
Minister Bill Shorten named Professor Bruce Bonyhady AM and Ms Lisa Paul AO PSM as co-chairs of the NDIS review panel in 2022. [Source: Twitter]

If the three-tier system for NDIS support is overhauled, it would mark a significant turning point in the Scheme’s history since the roll out in 2013.

Key points:

  • The National Disability Insurance Scheme review panel webinar was held on August 22, 2023, at the Newcastle Exhibition and Convention Centre — the birthplace of the NDIS
  • Professor Bruce Bonyhady AM, co-chair of the NDIS review panel, addressed key areas of reform which the panel will consider as part of the independent review
  • Prof Bonyhady was one of the original minds behind the NDIS, which was introduced in 2013 and acknowledged that significant change was needed to keep the Scheme viable


The independent NDIS review panel spoke in Newcastle on August 22, to deliver a webinar on their key reform considerations to improve the Scheme, which cost $35.1 billion dollars in 2022 and currently supports more than 600,000 people across the country.

One of the original minds behind the NDIS — which was introduced in 2013 by then-Prime Minister Kevin Rudd — review panel co-chair Professor Bruce Bonyhady AM said that the Scheme had been treated like it were an endless resource.

“[…] The NDIS is not limitless and we all need to stay within the bounds of those limits,” Prof Bonyhady explained.

“That is why we need to change. We all have a part to play in these changes — participants, families, providers and Governments.

“The review [panel] is speaking to Governments and I will be speaking to providers later this afternoon.

“This morning, though, I want to explain what these changes mean for people with disability, their families and carers.”

Prof Bonyhady explained the need for foundational disability support in Australia, rather than the existing three-tier system for accessing the NDIS.

In its 2011 report, the Productivity Commission envisaged the NDIS working in tiers:

  • Tier one covered all Australians
  • Tier two covered people with disability who do not need an individualised support package — roughly one-in-five Australians
  • Tier three covered people with permanent and significant disabilities who required individualised support — roughly one-in-50 Australians

The Professor expressed that the panel were considering getting rid of the tiered system to focus on foundational disability support rather than the minority of participants who require individualised support packages.

“Now that the NDIS is rolled out, we believe there is a need to prioritise the delivery of universal or foundational supports to the majority of people with disability and to create a joined up [sic] system rather than one which is divided it into tiers.

“Foundational supports available for all Australians with disability would include such things as information and peer support.”

The panel agreed with public feedback about the need to redesign the budgeting process, which they expressed was currently operating on a line-by-line and item-by-item basis,which may lead to excessive reporting and contention about what was considered necessary.

“This was never the intention of the NDIS,” Prof Bonyhady said.

“It was designed to provide an overall budget that is ‘reasonable and necessary,’ then give participants control and choice over how they spend their budget.

“The combination of line-by-line planning and participant demands for control and choice have blurred the definition of ‘reasonable and necessary supports’.

“It’s not producing a good experience for participants — or good outcomes. And it is contributing to financial pressure on the NDIS.

“The panel’s emerging view is that ‘reasonable and necessary supports’ should be set at an overall package level rather than line-by-line.”

The panel informed Newcastle community attendees that there would be more to come regarding the role of market caps, pricing and unregistered providers in the coming days.