Patricia Karvelas:
For some more pre‑budget chat, I want to bring in Andrew Leigh – the Assistant Minister for Productivity, Competition and Charities. Welcome to the program.
Andrew Leigh:
Thanks Patricia, great to be with you.
Karvelas:
You work very closely with the Treasurer. I suppose this question around the NDIS being pared back is now key and the government’s put it on the agenda. When he meets with state and territory treasurers tomorrow, what will he ask of them?
Leigh:
Well, we engage respectfully with our state and territory colleagues and we do understand the NDIS is the biggest savings challenge we have in the Budget. It’s nearly $50 billion; almost the amount we spend on the age pension. And when we came to office, it was growing at 22 per cent a year Patricia. We got that down to about 10 per cent and we’re working to find further savings because as a Labor creation, Labor knows how important it is to sustain the NDIS and to make sure money is going to those who really need it, not to some of sharks and shonks who’ve come into the industry.
Karvelas:
But it’s not just about sharks and shonks. Isn’t it Labor’s design of this scheme that’s been a failure?
Leigh:
Look, the design is strong. What we need to make sure is that the support is going to those who need it. Thriving Kids deals with one of the challenges in the NDIS, which is that we’ve seen a big increase in the uptake of young children with autism, particularly boys. And we think that Thriving Kids is a better way of supporting that vulnerable cohort than the NDIS. But the work that we’ve been doing through the competition portfolio, making sure that people aren’t falsely advertising that products are NDIS-approved where there’s no such thing, and ensuring that we crack down on the misuse of the scheme has been absolutely critical.
Karvelas:
Okay. But to that key question about the state and territory treasurers and what they’ll be required to do for them to be able to help children with Thriving Kids and perhaps others that you might be looking at, they’re going to need to spend more money. Will there be a deal that the Commonwealth offers? What sort of financial arrangements are we talking about here?
Leigh:
Well, I don’t want to front run an important meeting that the Treasurer is having with our state and territory counterparts, but I do want to note that we will engage respectfully with the states and territories. We understand the important role they play and the way in which we need to work with them in order to control the increase in cost of this scheme. I do remember Patricia, what things were like before the NDIS where you would speak to someone with a profound disability incurred by falling off a roof. And they’d say they could only get one shower a week. The NDIS has changed lives. We need to make sure that it continues and that it is a strong support for the future. The states and territories would be a key partner in that.
Karvelas:
Yeah, and if they don’t are you prepared to play hardball with them?
Leigh:
Look, I’m confident they’re coming to these conversations with goodwill. States and territories before the NDIS played a more significant role in supporting people with disability and their families. They understand the importance of getting their systems right. They have skin in the game thanks to the financial agreements that have been struck between the Commonwealth and the states and territories, and they understand the significant savings challenge. I believe their hearts are in the right place and I think that conversation tomorrow is going to be a productive one.
Karvelas:
May we need a different kind of funding model? Even for the NDIS – you’ve talked, you know, means testing has been obviously one of the things that’s been raised. Is that something you think is worthy of looking at in this Budget?
Leigh:
Look, my understanding is that’s not on the table at the moment. We’re focused principally on cost control in this scheme, ensuring particularly that the young children with autism are taken care of better than they are through the NDIS right now. The arrangement that we’ve struck with the states and territories does reflect a change in the costs there, so that the Commonwealth isn’t bearing as much of the upside risk. That’s critical because we need all governments working together in order to deal with this cost challenge. The NDIS is a great scheme – it’s a great pillar of the social safety net but it must be growing at a sustainable rate, otherwise it just won’t be there for future generations.
Karvelas:
Are you concerned though, that talking about cuts to the NDIS as your centrepiece for your budget makes people very anxious. People who rely on this scheme just to get them through the day to get their children the support they need. I mean, I imagine people are absolutely terrified hearing these stories?
Leigh:
Look I do understand the uncertainty that people feel. But it’s also important to recognise that we can’t continue with a scheme, which when we came to office was growing at 22 per cent a year. That would mean that ultimately, a risk that it wouldn’t be there for anyone. We need to ensure that the NDIS is fiscally sustainable. And you can go to parts of Australia where you see a huge number of NDIS businesses. Most of those businesses are unregistered. If you go to a sector like aged care, everyone’s registered. If you go to the NDIS, 4 out of 5 aren’t registered. And so, bringing that system under more reasonable controls is a priority for a Labor government. We built the NDIS. We’re passionate about support for people with disabilities, but it must be under control. The costs must be under control.
Karvelas:
Well to have absolutely public licence and social licence, everyone would agree with that. I have to take you back to the fact that Labor built it without that registration. I mean, that was a big mistake, wasn’t it?
Leigh:
Well, I remember at the time just the real sense of urgency that came from that Every Australian Counts campaign. Peak disability groups had united around a single call for an NDIS. And when I had people in my electorate office, there was just a sense of passion and a sense of urgency that we couldn’t slowly move into putting a system in place but it did need to be up‑and‑running at pace. We had, of course, 9 years of a Coalition government in which they did essentially nothing to deal with cost challenge…
Karvelas:
Okay. I’ve got to pick you up on this because I don’t think that’s fair. I’ve been on air, as you know, for many years and I know that the Coalition tried to rein in the NDIS, and Labor in Opposition was absolutely staunch in opposing their attempts to try and rein it in. Was that now a mistake? I mean, now that’s fallen in your lap?
Leigh:
I don’t think that’s fair Patricia. We had a Labor Opposition – Bill Shorten was leader for part of that and then had the shadow portfolio. We were willing to engage constructively on measures in order to contain the growth in costs. The Coalition were in office and they left office with the NDIS growing at an extraordinarily rapid clip. You know, what else grows at 22 per cent a year and is somehow thought to be sustainable? So we came to office, we took on that challenge first with Bill Shorten as the Minister, now with Jenny McAllister and Mark Butler. And Mark’s speech on Wednesday will be an important speech that I think will reassure people dependent on the NDIS, but also make clear how Labor will go about that cost control challenge.
Karvelas:
So you’re saying Labor made it, we understand, and I’m paraphrasing, that it’s your job to actually fix the mess it’s in?
Leigh:
Look, I think only Labor can be trusted in order to reform the NDIS in a way which is in line with its original purpose. Only Labor understands the importance of getting this scheme right. We saw significant cost blowouts under the Coalition. That’s simply a fact.
Karvelas:
Yeah and also Labor!
Leigh:
To blame Labor for what they did in government seems a bit rich to me.
Karvelas:
And also Labor. I mean, to be very fair.
Leigh:
You look at the growth in the NDIS under the Coalition, you compare it to the growth under Labor; we have begun the process of getting some of those costs under control. But when you’ve got one in 6 boys dependent on the NDIS, you’ve got to ask yourself whether this is a scheme which is working as it was originally designed.
Thriving Kids is aimed at getting better supports for that vulnerable cohort earlier, and dealing with the problem that, you know, as Bill Shorten used to say, if the NDIS is the only life boat in the ocean, people will naturally cling to it. If we’ve got other complementary supports that are better, then we’re able to assist vulnerable cohorts and also get the NDIS costs under control.
Karvelas:
You mentioned these young boys on the NDIS, one in six I recall is the figure, yes, and it’s quite a significant figure. I always wonder why we’re not actually having a bigger discussion about why so many boys need that support rather than just talking about the costs involved in it. Why don’t governments engage in that conversation?
Leigh:
No, I think we have Patricia, to be fair. The minimum age for social media was in part a reaction to the increase in anxiety and other mental health disorders we’ve seen, particularly among young Australians.
We do know that distracting technology, the endless scroll has been a challenge for the mental health of young Australians. It’s not the only thing that’s going on but it is a significant contributor to some of the challenges we see.
Karvelas:
Do you really think that’s part of what we’ve seen even in the NDIS?
Leigh:
You look around the world, and there are significant increases in mental ill health, particularly for young people. We’ve seen that over the last couple of decades.
But then also, I think, you’ve got diagnosis which responds to what’s available, to the supports that the government makes available, and making available a broader range of better tailored supports for early intervention really is vital in getting on top of this challenge.
Karvelas:
I want to move the topic, it’s still on the Budget though, it seems like changes to the capital gains tax discount are very much on the agenda for this Budget. Is it the case that you think that getting back to the pre‑1999 position before Howard and Costello changed it and created that 50 per cent discount is where you should move to?
Leigh:
Naturally the Treasurer will announce all of those things on 12 May, Patricia, but we had an Economic Reform Roundtable last year in which one of the things that came to the fore was intergenerational equity, and the importance of making sure that young Australians are able to get a home of their own.
Principally that’s about housing supply, and I was a bit surprised that Angus Taylor couldn’t see the important measures we’ve made to boost housing supply in his earlier interview. Given that he was part of a government that did nothing on housing supply, and for some periods didn’t even have a Housing Minister, he should be hanging his head in shame compared to the significant boost we’ve made on housing supply.
Tax settings play a role as well, and the Treasurer will make announcements on that on Budget night.
Karvelas:
Okay. Would you be surprised if the Budget did not touch the CGT?
Leigh:
I would be surprised if the Budget didn’t have the same level of ambition as Jim Chalmers’ previous budgets. Last year, the Treasurer announced the scrapping of noncompete clauses for 9 in 10 employees, a significant productivity measure that sits alongside the household supports we’re putting in place.
The Treasurer has a significant challenge, as his counterparts do around the world, in shaping a Budget for an extremely uncertain set of circumstances in which the world is facing down this major fuel shock, not sure how it’s going to end, not sure how long the recovery period is going to be.
This is an ambitious reforming government, you’ll get an ambitious reform Budget from Jim Chalmers on 12 May.
Karvelas:
Andrew Leigh, we are out of time. Thank you so much for joining us.
Leigh:
Thanks Patricia.