Podcast interview with Minister McAllister, Politics with Michelle Gratton – 25 June 2026

Media event date: 25 June 2026 Date published: 26 June 2026 Media type: General public MICHELLE GRATTAN : Jenny McAllister, your senior minister, Mark Butler, said this week that the eight week delay in passing the NDIS reforms will cost the budget a few hundred million dollars. So, how realistic are the strict budget targets that you set for reducing spending increases, notably keeping the increase to a 2% annual figure during the forward estimates.

Can you really seriously believe that can be done? SENATOR JENNY MCALLISTER: Thanks, Michelle. And thank you for having me on your podcast.

This reform is a really significant reform. I think Australians are very proud of the NDIS, but they want it to be fiscally sustainable. They want us to deal with the fraud and integrity issues that are present in the Scheme, and the disability community wants us to make sure that the services that people receive are of high quality, and our package overall addresses all of those issues.

In relation to the fiscal impact of the reforms that we propose, they are substantial. The Scheme left without intervention would grow to $70 billion per year by the end of the decade. Under our reforms, we expect it to cost in the order of $55 billion per year by the end of the decade.

It does involve substantial saves. We have thought through this carefully. We have a range of different interventions that we think will reduce cost growth in the Scheme, and we're confident that we can deliver those if the bill is contemplated by the Senate in August on the current timetable.

Can you quantify that few hundred million loss? MCALLISTER: There are some provisions that commence almost immediately upon the passage of the bill, including the approach that we take to unscheduled reassessments. For the most part, the major savings measures that arise as a consequence of the reforms were not anticipated to commence until October, and it's why we're confident that we believe on the timetable that we have agreed with a majority of the Senate that we can deliver our reform in a sensible and sustainable way.

And you do think that the Coalition will live up to that agreement that you believe you have, in other words, that they won't, even though they support these reforms in a broad sense, that they won't try and bust that October deadline. MCALLISTER: Well, that's a question for the Coalition, isn't it, Michelle, and this is a test for them in some ways. They say they are committed to a sustainable NDIS.

They say they are committed to addressing fraud and integrity issues in the NDIS. They say they are committed to responsible budget management. If that's the case, I would expect them to deal with this bill on a responsible and sensible time frame.

Just going back to the few hundred million, you don't have a more precise figure. MCALLISTER: We've indicated that that's our broad expectation, but we'd make any updates at the Mid-Year Fiscal and Economic Update. Which comes at the end of the year.

MCALLISTER: MCALLISTER: Now the government has agreed to limiting the Minister's power to make blanket cuts to categories of participant supports, how will you get to this 35 billion of savings over the four years without that additional power? MCALLISTER: This is a really important part of the reform, Michelle, and it would be good to be able to explain it. Social and Community Participation is a very significant part of the NDIS, and it will continue to be so, but it's one part of the Scheme that has grown very significantly in recent years.

Just a few years ago, it was $4 billion per year, it's now $12 billion per year, around the same size as the PBS. By the end of the decade, without intervention, it's projected to be $20 billion a year. And it's why we're taking the steps we are to bring that part of the NDIS budget under control.

We'd always intended that that power that's in the bill would be used in a quite limited way by the Minister. The government intends to reset community and participation budgets back to where they were in 2023 in terms of the expenditure for individuals from their plan. We see no harm in clarifying in the legislation that that's the approach we intend to take.

Some stakeholders from the disability community have been very strong on this point, that cuts to that part of the Scheme will lead to people being much more isolated, not having enough support to get out of the house, participate in activities. Now, accepting the point that this spending has run out of control, what's your response to those people's worries?

MCALLISTER: We listen really carefully when the disability community talks to us about their hopes and their fears for the future of the Scheme. Our broad posture is that the reforms we are undertaking are necessary to make sure that the Scheme is here in the long term. We want the Scheme to be in place for the child with disability that is born in 10 years' time, not just the child with significant disability that is born today.

We do need to make these changes, and we're confident that we can make them in a way that preserves people's access to the supports that they require. Remember that Social and Community Participation will continue to be a feature of plans under the NDIS, even with our reforms. We're resetting budgets back to where they were in 2023.

It will still be a feature of people's involvement in the Scheme, but we do think that by choosing this area of people's plans to focus on and to tackle runaway cost growth, we can therefore preserve some of the other supports that we know are really important to people, supports like supports for people with continence, with showering, with other forms of personal care, assistance in the home.

Those kinds of supports are not touched by this element of the reform. What other concessions have you made so far in talks with the Greens? And… no, I think I'll leave it there.

What other concessions have you made so far in your talks with the Greens? MCALLISTER: We were pleased to talk with the Greens about a reasonable timeframe for passage within the Senate, and they sought assurance about a number of areas of government policy. We have indicated that we're happy to clarify our intention in relation to these things.

We will set out that the support determinations will be limited to just Social and Community Participation and Capacity Building Daily Activities, we’ll also ensure that those determinations do not impact any employment or critical disability health related supports, and we’ll clarify in the bill that the definition of appropriate treatments people are required to pursue before being eligible for the NDIS won't involve restrictive practices, and won't involve treatments that don't involve public funding.

The Senate committee, at its hearings, heard some very emotional evidence, and that sort of evidence also came through in the thousands of submissions that the committee received. What has been your overall impression from that evidence, and has any of it caused you a basic rethink about elements of what you're doing? MCALLISTER: We know that a change to a scheme that is as important as this will be confronting for people with disability.

In part, that's why we chose to make public our intentions back in April, well before the budget, so we could have a longer public conversation about the approach that the government wished to take, and that that conversation could involve close discussion with disability leadership across the country, and both Mark and I have engaged very regularly over the last few months with disability leadership, but for that purpose.

We are confident that the changes we are making will deliver a more sustainable NDIS and one that is aligned with its original purpose, including its purpose of protecting people's human rights and supporting a much more inclusive society, but we can't go on with the status quo. There are problems with the Scheme, and we seek to have a really close, respectful engagement with the disability community about the changes that we're making and the reason for that.

We want them to understand. We know we won't always agree on every point, but we're very confident that the direction we've chosen is necessary for the long-term sustainability of the Scheme. You've canvassed what changes you've already agreed to, but out of the evidence, are there any changes that the government itself feels are necessary to the bill?

MCALLISTER: We've listened really carefully to the evidence, of course, and we've listened carefully in the private conversations and other consultations we've been having since April. We look forward to the committee providing its report. They'll provide that in August, and we'll make a response at that time to any additional recommendations that they put before us.

Let's talk about the states. Last term, when former minister Bill Shorten was making reforms to the Scheme the states dragged their feet. This time they put up objections.

Some people in the government say, well, this is just performative, but do you think the states will come on board on time, providing those services that they will now need to put in place as the Commonwealth retreats from various aspects of disability service provision. MCALLISTER: The Commonwealth isn't retreating from disability service provision. Under our reforms, the Scheme will continue to grow.

It will continue to be the second largest social program after the aged pension. We remain very committed to the delivery of the NDIS, and indeed, delivery of other forms of support for people with disability who are not on the NDIS. We should recall that there are five and a half million Australians living with disability at the moment, in the order of 750-760,000 of those are on the NDIS.

There are a lot of people who need both state and Commonwealth supports outside the Scheme. It's one of our areas of focus of reforms, working with the states and territories to put those reforms back in place. I'm really pleased with the progress we're now making on Thriving Kids.

That's a joint commitment of $4 billion of investment between the states and territories and ourselves, and we're seeing state disability ministers now commissioning really significant and important services at the local level that families and children will be able to access in natural situations, places where they are already. Can you give some examples of those services?

MCALLISTER: Yes, so states and territories looking to establish services that will support parents, give parents both support from professionals and peer support from other parents who are seeking to help their kids out, but they're also looking to put in place services in maternal child health settings, where parents will be able to go and get some really important supports for their kids, without needing to get a diagnosis, and without needing to go through an extended process of gaining access to the NDIS.

Nevertheless, the states have raised objections to this legislation, they're mostly Labor states, and obviously they're, they've got their own budgetary problems. How can you guarantee that this will all, this support service will all be put in place on time, because otherwise people will fall through the cracks, or they'll feel very nervous that they might fall through the cracks.

MCALLISTER: The NDIS is a shared enterprise. We have to work closely with state and territory colleagues. I work really closely with disability ministers, and have met with them very recently, and had an extended and really constructive discussion about the path forward from here.

We know this is a challenging reform timetable, but it's a necessary one. States and territories will benefit from the fiscal outcomes that will arise from these reforms, but their communities will also benefit as we make a joint investment in services outside of the NDIS. We've already agreed $4 billion for Thriving Kids.

There's another $6 billion on the table, services that we can stand up in communities right around the country that will be available for people with disability who are not on the NDIS. Many groups have been very concerned over the federal government's targets to cut, according to your estimates, 160,000 people from the number on the Scheme. How confident are you in that number?

And if the alternative supports, these state supports aren't in place in time, will people still be kicked off the Scheme? MCALLISTER: So we've been really clear that we don't want to see people fall between two stools, and the Prime Minister and Minister Butler have been very clear that we'll work with the states and territories to make sure that the supports are in place.

Changes to access aren't expected to be in place until January 2028. We have time to work with the states and territories, we know it's an ambitious timetable, but we're determined to get on with it. The Scheme was never intended to cover all people with disability; it was always intended to meet the needs of people with permanent and significant disability.

We're taking steps, necessary steps, to just make clear who that target group is. It's work we need to do with the disability community. We'll shortly announce a technical advisory group that will provide advice to government about the sorts of criteria we should use to assess permanent and significant disability, we'd expect deep consultation with the disability community themselves and also the states and territories as we step through that process.

As we look at this enormous growth in the spending on the Scheme, the thought does come that, of course, action should have been taken much earlier, and yet did politics stop that action. It became a very contested area, even though the Scheme received bipartisan support in the beginning. Did both sides of politics really fail to be willing to work together in earlier years to stop us being where we are?

MCALLISTER: I think the Scheme is of great significance to the Australian people. I think people feel very affectionately about it, and I think people feel very protective about the NDIS. My priority is working now, in the role I am today, to make sure that it is in the best possible position going forward.

There are many opportunities in the past when previous governments could have made decisions that would have improved the performance of the Scheme. I don't seek to re-litigate those. My focus is on gaining agreement now on the steps that we think are necessary to make sure that the Scheme is here for the long term.

So, in that context, are you having discussions, giving briefings, etc. to the other side of politics to try and keep everyone in the cart? MCALLISTER: Indeed, the government is working with the opposition, with cross-bench senators, to make sure that across the parliament people have good information about the government's proposed reforms. I am really hopeful of gaining support for these reforms in the Senate, because I think the community expects the parliament to get on with change.

You mentioned human rights before. Now, the Parliamentary Joint Committee on Human Rights, which is chaired by Labor, has criticized some of your reforms, saying, for example, it's unclear that the safeguards are adequate, and it's made various other points. Have you read this report, and what is your response to that?

MCALLISTER: We'll look very closely at the report's recommendations, but I will say this: our changes will secure an NDIS that is respectful of people's human rights and supports inclusion in the community. That is our goal. In fact, as the independent review of the NDIS said, and I paraphrase it, a human right that is not sustained is a right that is denied.

Our focus is making sure that this key scheme that's been so important in the lives of people with disability maintains community support and continues to be available for people with disability in the long term. The aged care assessment process has been criticized for using algorithms that rigidly apply criteria with little human input and no ability to override decisions that are wrong.

How will you avoid the same mistakes with the NDIS? MCALLISTER: I don't accept that characterisation of the aged care assessment process, and Minister Ray has spoken about this a lot. There is intense human involvement in generating the assessment itself, really well-trained assessors sit with a person and work with them to understand their circumstances, and that is a core part of the integrated assessment tool.

More broadly, in terms of the use of technology in human services, we know there are heaps of opportunities to make government services more efficient and responsive to people using technology, but we know there are risks too, and we don't intend to repeat the risks of the past. Any decisions about the use of technology in the NDIS will be made very carefully, and the bill before the parliament sets out a series of a series of safeguards that would apply if there was a decision to use technology in the context of the NDIS.

Of course, I guess these fears are very strong as we enter the AR year. MCALLISTER: I think the community appreciates the opportunities that AI might present for government services, but they're understandably cautious. We think about it in the same terms, and we're determined to make sure that where technology is used, whether it's AI or some older form of learning or decision making that it is always accompanied by safeguards that protect people who use government services.

Now, autistic adults with just moderate support needs are worried about being ejected from the Scheme without adequate supports being in place. What assurances would you make to them? Will people with mild to moderate support needs remain on the Scheme until 2028?

MCALLISTER: Our reforms don't seek to target any particular kind of disability. In fact, the changes that we propose seek to move away from diagnosis and towards functional capacity as the relevant measure, however, as I've already said, we do want to see supports in place for people who are no longer accessing the NDIS. We'll work really closely with states and territories to stand those up.

In just the last few weeks, our government has announced investments that we are making in supports for autistic adults and children. We know that the autism community does need support outside of the Scheme, and we're already making investments to support people in those areas. Another issue that's been raised, and it's worrying people, is that under the changes they'll have to have exhausted all forms of treatment that could be reasonably accessed to improve their impairment before being eligible, yet not everyone can do this, and many people certainly can't do it easily or affordably.

What do you say to this issue? MCALLISTER: The NDIS was never intended to replace the health system, and where people have health-related needs, we want the health system to respond to those needs, rather than see people come into the NDIS to have their health needs met. Our government considers that reasonable health, in terms of available and appropriate treatments, we're talking here about treatments that do receive public funding, so public funding through the Medicare system, public funding through the public health public hospital system, or public funding through the PBS.

We want to be sensible about this, but we don't see the NDIS as the appropriate place for people to have their core health needs met. But you think that people will be able to, let me put that another way, but you think this provision will be administered in a reasonable way, that people will have to jump some hurdles, but not impossible hurdles. MCALLISTER: We'll be sensible about this.

Our intention is making sure that people have their health needs met in the health system, and you'll know that the government is making very significant investments in the health system, an eight and a half billion dollar investment in Medicare, for example, but also making sure that the NDIS is there for people with permanent and significant disability, and whose disability, in particular, is permanent.

One of the features of the NDIS has been the apparently very high level of rorting of fraud. I can't think immediately of any other current government scheme that is talked about in these terms. Why do you think there's been so much fraud?

How much progress have you made so far on the fraud front, and how much still needs to be done? MCALLISTER: The NDIS has to be safe, and it has to operate with integrity. And where we see fraud, we nearly always also see harm to disabled people.

So, why is there so much? MCALLISTER: When we came to government, there were nearly no controls on compliance within this scheme. From 2022 we have had to start from scratch in building up a compliance and enforcement capability in the NDIA.

As an example, in just one day, today, the NDIA will check more claims today than the previous government was checking across an entire year. There were simply not the administrative capacities to deal with non-compliant claims in the Scheme, and we have had to make very significant investments in people, in systems and in new laws to deal with that. We've invested something in the order of $1.35 billion since coming to government in tackling fraud and promoting integrity.

This last budget has $800 million to tackle fraud and promote integrity in the Scheme. The bill before the parliament has five schedules. The longest of these is Schedule Two.

It is the schedule titled Fraud Measures. This is a significant focus for the government. I'd like to address one other issue about this, if I may, Michelle.

Sometimes people say you should seek your savings from fraud rather than the other measures you propose. This misunderstands what usually occurs when we find and disrupt fraud in the Scheme. In most instances, if we see fraud and we disrupt it, the saving that arises goes back to the disabled person whose money is being improperly used.

It's not a saving to government. So we will intend, we do intend to continue our work to tackle fraud. There are significant measures before the parliament.

We passed a new bill earlier in the year that put in place significantly higher penalties. We have new investments to tackle fraud, but the savings that arise from that go to disabled people themselves, not to government. So, where do you think you are on the question of getting a fraud-free Scheme?

Are you nearly there? Are you halfway there? Are you well less than halfway there?

MCALLISTER: The previous Quality and Safeguards Commissioner estimated that the rates of integrity leakage in the Scheme could be as high as 20%. The current estimate from the NDIA is 8%. we've made progress. There is significant work still to do.

I'm really pleased that the budget has prioritized this, that we've got further investments to keep the fraud fusion task force running. We've got further investments in digital capability, and the legislation before the parliament will give the NDIA strong powers to investigate and prosecute fraud, so that we can further improve the integrity of this Scheme.

We think it is essential for the safety of people with disability, for value for money for taxpayers, and for the ongoing community support for the Scheme. Jenny McAllister, thank you for joining the podcast today to give us some idea of the issues and the scope of this massive reform that you're involved in undertaking. That's all for today's podcast.

Thank you to my producer, Ben Roper. We'll be back with another interview soon, but goodbye for now. Thanks.

Senator the Hon Jenny McAllister Disability and carers Accessibility We acknowledge the Traditional Owners and Custodians of Country throughout Australia, and their continuing connection to land, sea and community. We pay our respects to them and their cultures, and to Elders both past and present. © Commonwealth of Australia