E&OE TRANSCRIPT
SUBJECTS: Eliminating fraud and overcharging in the NDIS
LAURA JAYES, HOST: Welcome back. Let's talk about the NDIS because dodgy operators, many of them are taking advantage of this system. Billions of dollars meant for disabled Australians are instead being completely rorted. This was Senate estimates on Monday night. This was the man who's in charge of essentially cracking down on fraud within the system. And this is the extent of it.
SENATE ESTIMATES CLIP [JOHN DARDO, NDIA DEPUTY CEO INTEGRITY TRANSFORMATION AND FRAUD FUSION TASKFORCE]: There would be thousands of cases where participants are claiming things that are not consistent with the plan. The systems are so immature that some of the channels that participants could claim through require no ABN, no description, no word, nothing. It's just a, they can put in a dollar amount, and they get paid. There are a segment of support coordinators that are not doing the right thing. And we need to - I can't audit every one of them. We need to send a message to them that we are now starting to look at the broader sector and that we do need the bar to be lifted.
JAYES: And joining me now is the NDIS Minister, Bill Shorten. Thanks so much for your time, Bill. John Dardo there was really begging for more help. I mean, he is seeing fraud right across this system. In another part of that testimony, he even said that, you know, he's seen elements of fraud in 90% of providers. Are you aware of all of this?
BILL SHORTEN, MINISTER FOR THE NDIS AND GOVERNMENT SERVICES: Well, I'm the bloke who hired John Dardo because before I became the Minister, the back office of the NDIA was not scrutinising it at all. And John's been doing a great job with the whole new leadership at the NDIA, telling me what we need to do. The points that John was making, and I just need to correct one thing you said, that he said 90% of providers are doing the wrong thing. He didn't say 90% of providers. What he said is, they studied plan managers, which are a small part of the whole Scheme. And he said that of the smallest plan managers, that a lot of red flags came up, more than 1 or 2. I need to be very clear. Most providers are doing the right thing. Most participants are doing the right thing. But John has identified that there is no back office checking of payments. I'll tell you one story he told me, which made what hair I have curl. He said that in the past before we were there, if you were to put in a claim for payment between 5 p.m. and 6:30 p.m., you just got paid. There was no checking. But if you think the rest of the 24-hour cycle was good, the Agency, and this is why he said they had an immature system, could only check on average 21 claims a day before they were paid to see if they were fair dinkum. Now we've changed that since I've been here.
JAYES: But isn’t he saying that that is still happening? He said you don't need an ABN; you don't even need to itemize it. You just get paid.
SHORTEN: No, I think you're being a little selective. John is saying there's still systemic problems which require further work, and that's what we're doing. The very fact that you're talking to me about it is because I put that guy there.
JAYES: Yeah.
SHORTEN: The reality is that we've now got - you know, I guess it's the catch 22 about talking about the NDIS. Media sometimes want to talk about all the problems and that's legitimate. Some participants are saying, Bill, please don't talk about the problems because it demonizes participants and providers. Most participants and providers are good, but there's an unacceptable proportion of fraud going on. And now - the fact that we're having this conversation is because of me and the Government of the day, and we are moving on it, but you can't sort it out overnight.
JAYES: Yeah, but we are still talking about $2 million worth of fraud being committed a year.
SHORTEN: Absolutely. That's his estimation. And we are talking about it. That’s why -
JAYES: But if it was any other program, Bill. I mean, it would almost be investigated by police. I mean, you'd almost be calling for a Royal Commission, $2 billion a year and we're sitting here talking about a cost-of-living crisis.
SHORTEN: Okay, now you've finished, I'll just tell you. I get up every day and work on this Scheme. And I've tried, you know, I've spoken to you about it in the past. We've now doubled the number of investigators in the Safeguards Commission. We've now set up this fraud fusion task force, which Mr. Dardo runs. I wish that perhaps for the last ten years, there hadn't been naivety about how the Scheme attracts some spivs and shonks, wherever there's Government money. But no, I would not scrap this Scheme at all. But we need tighter laws, better technology and more people and we're doing all of that.
JAYES: Okay, naivety over the last 9 years.
SHORTEN: This is an overdue conversation.
JAYES: Yeah, absolutely. Naivety over the last nine years. That was when the Coalition was in power. But it was the Gillard Government designed this. If you don't have the checks and balances that he's talking about, and he's saying they're still immaturity in the system, this was a design flaw. When this came in, Bill, we were told that this was to help the most profoundly disabled become productive members of the society. On that measure, hearing from John Dardo, it's a failure in many ways. And if you undermine the system like this, and taxpayers see this kind of waste and rort, I mean, how do you bring people with you?
SHORTEN: By just telling the truth. The truth is, though, hundreds of thousands of lives are being changed for the better. But you'll never see that on TV because good news doesn't sell, I get that.
JAYES: Yeah.
SHORTEN: And we've also got to tell the truth that there are spivs and charlatans. When I came in, there were only 41 investigations underway. There's now 220. When I came in, only $231 million of payments had been investigated. Now it's several billions of dollars, but you've got to have due process. Now there's 20 prosecutions in the courts, another 12 queued up, 510 plus compliance investigations. We've doubled the number of people working in the Safeguards Commission. And by the way, we keep saying somehow Julia Gillard’s to blame, please don't do that. The reality is that as the Scheme got to full development -
JAYES: I didn’t say that.
SHORTEN: - you said Labor designed it. My point is that -
JAYES: Well, Labor did design it.
SHORTEN: Sorry, we didn't design the payment system. And when I was in opposition, I couldn't get a lot of interest out of the media to talk about the problems. And now I'm in Government, the problems are worse than I thought. You know, we've got we've got Liberal ex-ministers grandstanding like their life depends on it now. But hats off to the current Coalition opposition, the mainstream people, they're willing to sit down and engage with us. how do we improve it? But I just want to say to people with disability, you hear all of this. Most participants are not doing the wrong thing. Some are getting sucked in by manipulative operators. Most operators are good. But I'll tell you what, if you are a crook, we will catch you. If you are overcharging, you will get caught. It's going to take time. You haven't had this sort of diligence and vigilance before. I love the Scheme, and I'm going to make sure that anyone who wants to hurt my Scheme is not welcome in the Scheme.
JAYES: All right. Let's talk about the legislation that is before the Parliament, because there is a little bit of consternation about it. It is about bringing the overall spend down, and I accept that. But it doesn't seem to go far enough when it comes to clamping down on the unnecessary spending. There is a lot of concern from the states, you want to reduce the number of people eligible, but essentially the states feel like you're pushing that responsibility to them, and then they've got to decide who's going to be ineligible, so you don't have to make that tough decision. Is that fair?
SHORTEN: No, it's not even right. Listen, the states are co-contributors to the Scheme. When it was set up, they meant to pay 50% of the Scheme, the feds 50%. The feds now pay 70%, they pay 30%. They're worried that tens of thousands of autistic kids are going to turn up, and all of a sudden, the states have to pay for them. That's wrong. But the states do need to do more. We'll work on it together. They are doing a range of things. Some of them have thought that disability is just a federal issue. It's a community, society issue. I think the states when they see the various bits of legislation will calm down. They feel they're being rushed. And this is, again, one of the sort of neat conundrums, isn't it? On one hand, you've spent the first few minutes saying, Bill, we're not doing enough. We've got the whole Scheme, you know, it's in peril. And then the states would say, Bill, slow down, let's have a cup of tea. Let's kick it along ‘til next week, next month, next year. The truth is people with disability don't have time to waste. We've had a four-year Disability Royal Commission, a 12-month root and branch review. The changes we're making will take years to implement, but the longest journey starts with the first step, and we've taken a few steps already.
JAYES: Okay, I appreciate your passion in this area. There is some criticism as well, Bill, that you have, you know, it's taken two years to get this legislation. The argument is it doesn't nearly go far enough. And what we still are seeing is that people are buying cars with NDIS money. They are buying drugs.
SHORTEN: Okay, so let's understand -
JAYES: How do you stop that?
SHORTEN: Well, first of all, buying cars and drugs is not very - it isn't happening, it's a very small portion of the overall Scheme –
JAYES: It shouldn’t happen.
SHORTEN: - but it's illegal. Wait a sec, it's been illegal the whole time. It's still illegal. The problem is we haven't had the back-office functions to scrutinise the 150,000 unregistered providers, to scrutinise the claims, to have the software which is, you know, exists, to have the ability of the tax office and the NDIA to talk to each other. Now, this stuff is pretty basic, but no one's done it until now. We're implementing that. But the thing is, on one hand you say it's two years, what have you done? On the other hand, if you listen to the states and some advocates, we're going too fast. So, you know, I think it's a very fine line between too slow and too fast. But we've picked it.
JAYES: Well, I think the criticism is there that you're concentrating on the overall spending and that's fair enough. But at the same time not clamping down on the fraud fast enough. And they're two separate things.
SHORTEN: Okay. That's - well, the second’s a part of the first? The reality is that because of me and Labor, we set up the Fraud Fusion Task Force $126 million. We did that in 2022. We then in the March ’23, the May ‘23 budget, doubled the number of people at the Safeguards Commission, invested $140 million. Now we're rolling out $300 million of extra software and technology to catch the crooks. We are making a big investment. The Agency, the people who run the Scheme and the guardians of the Scheme, had been chronically underfunded by my predecessors. We're now putting that in place. We're also clamping down on our price gouging with the ACCC. We're also changing the leadership of the NDIA. We've also got 23 co-design groups of people with disability. The thing is, you say, not you, but some people say, oh, we should have this legislation a lot earlier. You've got to talk to people with disability before you do things to them. But I'm sick of NDIS being a mirror issue where everyone just looks into it. It's time for action and that's what we're doing.
JAYES: Well, because it's so expensive, Bill. It’s a huge expense. It's almost $15 billion a year by the end of the forward estimates, and you've got people buying cars with it. I mean, you can understand how –
SHORTEN: Alright, you’ve said that, and I am –
JAYES: But we sit here and it's - but really, but also John Dardo, and I just quickly want to go back to this. He says, you know, the immaturity in the system still where, you know, more than a decade since this has been implemented, do people really not have to put any receipts or itemize what they are buying with this money? Is that still happening?
SHORTEN: No, people have to put in invoices. But he's talking about the lack of proper surveillance and software to scrutinize invoices. And that's what we're changing now. Now, we do scrutinize a lot more claims. One of the big design problems that emerged in the last ten years is 87% of service providers are unregistered. Now, when we talk about registering them, I get screams from some people saying that diminishes choice and control. It doesn't.
JAYES: Who cares?
SHORTEN: But if you're going to get paid to drive someone to the shops-
JAYES: If that's wasting money, why is that where the balance?
SHORTEN: But I'm just telling you. I'm just telling the truth. The truth is that you should have a driver's license. We should know it. And you should have car insurance. So, I can think about six different areas where we're doing the overdue reforms. But the one thing is that when you talk about the level and you say cost, I still call it investment. The reality is there's 650,000 people with profound disabilities. Half of them precious little kids are they were found support which never existed,
JAYES: Are they profound? I mean, 650,000 that is profound. Profoundly disabled.
SHORTEN: And severe, yeah. They do have severe and profound disabilities. And what we're seeing is that's life changing, because the point of this Scheme is it's like Medicare. And when Medicare was set up, there's still rorters in Medicare. And that's 40 years old.
JAYES: Yeah.
SHORTEN: And as for investment and wasted money, I can think of, you know, we give tax breaks to the biggest end of town who still make massive profits. I don't mind taxpayer money going to profoundly disabled people. I just want to make sure that it’s based on delivering outcomes, it's evidence based and it's not enriching and lining the pockets of some people who are just not interested in people, disability or taxpayers, just their own selfish interests.
JAYES: Well, we really thank you for your time today.
SHORTEN: It's a work in progress.
JAYES: Yeah. And I know you appreciate that this is a pretty passionate area of policy.
SHORTEN: Oh, it’s a big topic.
JAYES: And if you don't have people believing in the integrity of the system and you see rort after rort, it doesn't survive.
SHORTEN: Yeah. Spot on.
JAYES: Okay. We'll see you soon.
SHORTEN: Well said.