Regular guest writer, James Glover, returns to the Mule today to look at the figures behind the proposed NDIS.
The National Disability Insurance Scheme (NDIS) is in the news again. A welcome development for people with disability and their carers and families…and friends and pretty much anyone else who cares about their fellow humans. It is not a platitude to say that disability can strike anyone at any time in their life and the stories of these people are truly moving and shaming, especially as we live in one of the richest countries in the world. Adults who are only provided with two assisted showers a week and parents providing 24/7 care to profoundly disabled children but who cannot afford a new specialised wheelchair because there is limited funding for such things (wheelchairs cost from $500 for the basic models, of which I have two, and range up to $20,000 or more). In August 2011 The Productivity Commission reported on and recommended the NDIS and since then pretty much everyone agrees it is a good idea if we could only agree how to fund it.
So what does it replace? Currently most people with serious disabilities that prevent them from, inter alia, working, can receive the disability support pension (DSP). A small number will have insurance payouts if they were “lucky” enough to to have someone else to blame for their disability. In addition, anyone can receive a rebate on medications in excess of about $1,200 a year and, of course, access to (not quite free) public health care. On top of that, there are concession cards for public transport and a taxi card system which provides half-price taxi fares to partially make up for many disabled peoples inability to use public transport. The DSP does not depend on a specific disability and for a single adult over 21 with no children it is about $19,000 a year. For child under 18 who is living at home it is about $9,000 a year. While this would appear enough to live on (forgetting overseas holidays or a mortgage) most such people rely on additional support services for everything from basic medical equipment to respite for carers. There are currently 820,000 people, about 4% of the population, on the DSP. The Productivity Commission estimates 440,000 people on the NDIS so most of these will not be eligible for the NDIS but may still receive the DSP. People 65 and over of pensionable age are not eligible for the DSP and will not be eligible for the NDIS.
The purpose of the NDIS is to provide funding for care in line with the specific requirements of the recipients, and will mean additional support to the DSP for some. You can read more about it at ndis.gov.au. Unlike the DSP, it isn’t a fortnightly stipend or, like standard disability or employment insurance, a lump sum. The government is planning to roll out pilot programs in many regions in the next few years, aiming for a complete national program by 2018-19. I won’t go into the politics but it seems even politicians can feel shame and bipartisan support for the NDIS is emerging with a good chance of a bill through this parliament in the next few weeks. The total cost of the NDIS is often quoted as $18bn a year. Some funding is proposed from an additional 0.5% to the Medicare levy. Other funding wil come jointly from the federal government and the states. The proposed levy will raise about $3.8bn a year, so nowhere near enough for the full cost. If you subsume the half the DSP cost of $11bn a year that (only) leaves an outstanding amount of $8-10bn a year to be funded even with the Medicare Levy. Hopefully with bipartisan support the full NDIS will be implemented sooner rather than later.
So that’s the background on the NDIS. The real purpose of this article though is to consider the question “How many disabled people are there in Australia anyway?”.
Well that’s easy, just read any article on disability–for instance this one by disability advocate and media personality Stella Young–and you’ll be told the answer: 20%. 20%. 20%! I am a huge admirer of Stella Young’s work, so don’t get me wrong if I choose to disagree with her on this. The 20% figure gets quoted so frequently it must be true. Well maybe. People questioning this figure are directed to the 2009 ABS Census report on disability where the self-reported disability figure is 18.1% (+/-1.3%). So a round 20% is not too bad, right? Well like all statistics, the details are important. Firstly this includes people of all ages and, not surprisingly, many more older people have disabilites. From 40% at 65-69 to 88% at 90+. For those under 65 the figure is 13.2%. It increases with age and, in the 45-54 age group, is about the average 18%. Anyway why does it matter if the true figure is overstated? Well one reason is that while there is widespread support for the NDIS, the one concern that keeps coming up is who is eligible.
According to the Productivity Commission report they estimate 440,000 people on the NDIS of whom 330,000 would be disabled, and the rest made up of carers and people on preventative programs.
This report has a deeper analysis, which takes the figures at face value. It also includes breakdowns by disabling condition. I have paraphrased these in the following table based on some of the major causes of disability. And look, there are those perennial favourites of those who think all disabled people are really bludgers: back problems,stress and depression, making up about 18% of the total. Not quite bankrupting the country then.
But what constitutes disability? It is basically a lack of normal activity rather than a set of diseases per se. The ABS report has 5 activity based categories, four of which are based on “restrictions on core activities: communication, mobility, self care”. There are “profound”, “severe”, “moderate” and “mild” levels of disability. A fifth category is “schooling or employment restriction”, but overlaps with the first four. Here is a table with the breakdown by category and age group. Combining those with a core activity limitation with employment/school limitations the figure is 15.3%. The difference between this and the higher self-reported 18% figure I suspect comes from peope who feel a bit crap a lot of the time, but aren’t signficiantly prevented from their activities. So I would estimate the number of disabled people to be more like 15% than 20%. For those under 65 this is 11%. The NDIS has a similar definition but includes social activities as well, but don’t yet provide any breakdowns.
So much for the figures from the ABS, which I think we can all agree are definitive, right? Looking at the ABS figures for this group (under 65) they total 345,000. But wait! The figure of 15.3% is based on a total number of respondents to the census of only 9.5 million people. If the reportage rate was the same as the general population of 22m then there would be about 700,000 severe or profoundly disabled people. But the Productivity Commission only estimates 330,000 or half this number on the NDIS! The alternative to the unlikely event that less than 50% of profoundly or severely disabled people will end up on the NDIS is that the reported ABS figure for people in this category is correct but the rate is wrong. While the overall reportage rate is about 50% it looks like the reportage rate for disabled people in the severe and profound category is closer to 100%. If this was also true for the other categories of disabled people then that suggests that the real rate of disability is less than 9% and maybe as low as 7%. Assuming the reportage rate is the same as the rest of the population, ie 50%, for the other categories then the disability rate might be as high as 13%. So lets split it and say 10%. In any event the widely reported figure of 20% is well above the highest estimates based on the ABS and Productivity Commission data. The real rate of disability is closer to 10% than 20%.
Does it matter? Maybe. If you claim that 20% of the population are disabled, people start quickly calculating that the cost is unsupportable if all of those people are on the NDIS! Which of course they won’t be. Fewer than half of disabled people are already on the DSP. Less than half of those will transfer to the NDIS. Overstating the percentage of disabled people isn’t necessarily a good argument for the NDIS if it reduces support from otherwise sympathetic people.
A final thought: in the large Australian organisation I work for, there are a fair few disabled people, some of whom I think would be categorised as severe. With proper support many disabled people can gain suitable education or training and hence employment and support themselves and contribute to the economic activity of the nation. The more people with disability who are employed the fewer on the DSP or NDIS, the more money for those who really have no choice. Supporting people with disability into employment is as important, in my opinion, as supporting them in living and care through the NDIS.
[This article was rewritten following some comments and some further research. In line with all my articles on Stubbornmule this article is about estimating rough numbers from scarce data “back of the beercoaster” style rather than disability politics, it just happens I have a personal interest in this subject]
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From memory the percentage of disabled persons out of those either working or seeking work is about 3-4%. This has roughly doubled in the last couple of decades. This is as people found it harder to get work and the penalties for not meeting the requirements for active job seeking increase, more people have tried for the DSP. Many of these have disabilities that would not be recognised by many people as disabilities, for example drug and alcohol problems. I expect that they won’t be receiving any benefit.
A surprising, or maybe not so surprising, number of 75+ are still looking after their disabled children, because they don’t trust the government services, and are now worried what will happen when they can no longer care for them. This will be one of the major areas in which the government will need to improve services, and in a way that is long term sustainable, so it is apparent that it will continue. Throwing money into short term projects just hasn’t worked.
One thing our current government will go down in history for, is a total lack of planning ability. Policies are chosen for how the electorate views them, and then the public service is expected to justify them, not to critique them.
Hi Ken – actually the percentage of people self reporting as disabled in the census has actually dropped in the last few years. There could be a number of reasons for this – maybe less people consider themselves as “disabled”, maybe health care has improved. I don’t really think it is helpful though to make the connection back to political parties. I am a bit of a lefty myself but I believe that Tony Abbott and Joe Hockey, along with the rest of the Coalition are genuinely interested in getting the NDIS up and running. Let’s keep politics out of it shall we?
I don’t know how comparable Australian and US schemes are, but there was an interesting This American Life podcast (“Trends with Benefits”) recently which highlighted the huge growth in use of disability benefits which masked hidden unemployment. Linking into you last point, James, one of the problems there seems to be that disability benefits are at risk if you receive income employment, so you have exactly the wrong effect: the scheme seems to discourage people with disabilities from working rather than supporting them into employment.
If I help a cripple carry wood up stairs in a 2 storey house that they purchased after becoming a cripple, can I claim?
@Whatsinitforgary – you make an interesting point. Does the NDIS mean that as a society people with disabiity no longer need to rely on the support of family and friends or indeed the kindness of strangers? Famously the US has a much higher rate of philanthropy supposedly because the government provides less. Leaving aside the general question though currently the people in the profound and severe disability categories require full time care usually either at home with their parents or in care. Many young profoundly disabled people end of in aged care homes when their parents are not able to care for them. This also means often one parent has to give up full time work to become a full time carer thus increasing the poverty trap. I doubt if the NDIS will remove the role that families play though it will alleviate it by giving them more access to respite care and better equipment which seems to be a major issue, often waiting several years for a new wheelchair which a child has outgrown.
So the answer is “no” you won’t be able to get any payment from the
NDIS for doing what a normal person would consider to be an act of kindness to a friend with disability. I am sure that person was grateful for not having to carry the wood up the stairs as they do the other 99 times out of a 100 when no one is around to help. And I am sure they repaid your help with an act of friendship of their own (what’s that funny smell?)
Mule – thanks for posting TAL podcast – I always come over all funny and weak at the knees when I hear Ira Glass say “this is Ira Glass”. Where was I? Oh yes in that podcast it seems the amount for disabled payments was about US10k a year which is about what NewStart is here and about half of the current DSP. My estimate is that the predicted cost of the NDIS will average about $50k/yr for 400k people. Some will get less than this and some much more. I doubt if the actual stipend (currently about $19k/yr for a single adult) will increase much but there will be extra funds provided for care and equipment that people currently pay out of the stipend or, as is more likely, go without. A hypothetical “bludger” who has wrangled the DSP for a “bad back” won’t require additional equipment or care so is unlikely to be better off on the NDIS. Assuming such people exist already. This extra allocation will be based on professionally assessed need. So I don’t think there will be much additional incentive for people to falsely move to DSP that isn’t there already.
Following on from the excellent This American Life (and also Planet Money) podcast on disability in the US, and its use to “hide” people who otherwise would show up in the unemployment stats, have a look at this:
http://apps.npr.org/unfit-for-work/
The most interesting aspect for me was the federalism angle (namely States paying private organizations to shift their liabilities onto the Federal balance sheet). I think that’s not quite the case downunder.
Hi Stubborn Mule,
Great read, and yes a good argument about how disability should be defined and counted. Stella’s choice of the high proportion – 20 % – is meant to foster a ‘there’s more of us than u think’ and ‘we all could be disabled’ feeling, but it doesn’t really give us a clear picture of the numbers. However, your statement-
‘There are currently 400,000 people, about 1.7% of the population, on the DSP’ is way off- perhaps a typo?
More than twice that number- about 824 000 people – are on the DSP here in Ox. – see http://www.news.com.au/lifestyle/health-fitness/australias-welfare-system-is-broken-with-thousands-trapped-on-disability-support/story-fneuzlbd-1226614397243
Again- interesting read, and for more great commentary, see this article about the DSP: http://www.abc.net.au/rampup/articles/2012/01/12/3406656.htm
cheers Nick
@Nick thanks for the comments….I’ll leave it to James to respond on the 400,000 figure.
@Nick – thanks for the correction – it is indeed over 800,000 people currently on the DSP. The original Productivity Report estimates about 440,000 on the NDIS of whom 330,000 are being directly supported for a disability and 110,000 for preventative action. That 330,000 looks very similar to the 345,000 in the ABS severe and profoundly disabled category. This also suggests that the reporting rate in those categories is close to 100%, certainly not 50% otherwise there would be less than 330,000 people on the NDIS out of 700,000 people in the profound and severe categories which seems highly unlikely.
This suggests the DSP will act as a standalone payment while the NDIS will be for additional support for those in a special category. It is not clear if the money for living support currently provided for those 330,000 on the DSP has been included or not in the NDIS figure. It’s quite hard getting details which is a worry.
@Nick – I edited the article a fair bit following your comment so thanks.
‘Supporting people with disability into employment is as important, in my opinion, as supporting them in living and care through the NDIS.’
I emphatically agree- employment improves peoples lives in countless ways, providing a sense of inclusion and of achievement, social interaction and friendship. It gives people autonomy and independence and improves people’s mental health, and of course is a net gain to the economy.
On counting numbers of people with disabilities- all ‘counts’ are cultural constructs about which there will never be consensus. That’s inevitable if you subscribe to a social model of disability, as I do. And that has implications for social policy that haven’t yet been explored- but might make a good topic for another post. Thanks for this discussion.
Thanks!
Hi @Nick – I actually considered starting this post with a statement to the effect that we should all be happy because it appears there are only about half the disabled people in Australia as previously thought! But it seemed a bit glib. I was really interested in the way the ABS used the census data to come to the conclusion that 18% of people are disabled.
Not specifically about disability but it appears they estimate rates in category x by dividing the number of respondents saying they are in category x by the total number of respondents which is only about half the population. Fine if the responding rate (50%) is the same but possibly overestimating the rate by 2x if the responding rate in that category is 100%. Or underestimating it if the responding rate is, say, only 20%. A recent guest post by John Carmody explored this in relation to estimating the true rate of death from the plague based on self-reported numbers. The answer is to try and tie back the total numbers to some other estimate (in that case burials). In this case it is the estimated number of people who will be on the NDIS.
I am going to contact the ABS and see what they have to say, in the case of disability and in general, for a future post. Thanks for the feedback. I accept that there are bigger issues here than my occasional obsession with statistics.
Also http://www.abc.net.au/news/2013-04-08/charity-says-too-many-people-claiming-disability-support/4615276
While some of this is demographic shift, a lot is simply that our job market isn’t as buoyant as many claim, with our actual employment rate at least 8%.
I know someone who is on the disability support. History is back injury in middle age. Being well enough to be on unemployment means continually showing readiness to work by doing course, applying for jobs, and doing whatever work is available. Eventually you are injured again, and lose what work you have. Final result is drug and alcohol problems. Having been put on disability and sorted out his problems, and now being around 60 there is little point in being otherwise, as he is unlikely to get work. The combination of over 55, disability and low education is almost a guarantee of continuing unemployment.
Well. It is now February 2014.
In NSW the state government is fully privatising the services.
As a support worker in disabilities I am appalled at the idea of business being made from this sector.
Low pay, transient staff and the very real chance of 457 visas to fill the vacancies.
I think the NDIS seems OK for some persons of low support.What we are witnessing in the Hunter Region is the private sector trying to give back to the Government Disability the more high support persons as they are simply not up to the job and lack expertise and stable employment of qualified staff.
The NSW Government propaganda is in full swing and they also have there eyes on selling off valuable Real Estate where these persons abide.
As the saying goes, “you ain’t seen nothing yet.
More privatistion = less choices. ( well not for the Government)