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The Australian: Financial struggles causing service providers concern

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13/09/2017

The Australian has released a story today about the struggle of disability service providers such as CatholicCare Sydney to keep their doors open under the financial pressures of the NDIS. 

The story cites NDS’s financial sustainability report, released on Monday with research from the University of Western Australia, which found that profits among small disability service providers fell to 4 per cent in 2015-16, while profits of large bodies continued to grow from a low margin to 3.6 per cent.

UWA’s Professor David Gilchrist said that even though the largest providers are increasing profit overall, “they actually aren’t making money from disability services… That profit is almost uniformly coming from other areas of the business.”

The Australian also spoke to NDS Chief Executive Ken Baker, who said that prices under the NDIS are ‘extremely tight’.

“The key question is: Do the not-for-profit providers have sufficient working capital, and do they see sufficient growth in the future to continue? That’s not entirely clear just now,” Ken said in the article.

“The scheme’s prices are extremely tight and there needs to be profit ... so providers can expand and respond to huge growth in demand.”

The story highlighted that the review of NDIS pricing structure will be completed by the end of the year and that prices will be decentralised ‘at some point’. 

“Providers are making these decisions now, to get out of certain disability services, and the NDIA needs to respond now rather than wait for that review,” Ken said.

Read the full story here.