National Disability Insurance Scheme: Where will the funds come from?
Updated
A ferocious argument has erupted between the Federal Government and Opposition over the funding for the $22 billion National Disability Insurance Scheme (NDIS).
Labor established the NDIS and is determined to not only defend its legacy but counter Coalition claims that it left the scheme only partially funded.
It's a crucial question because once it is fully operational, it will be one of the biggest Government-funded programs after Medicare.
Shadow families minister Jenny Macklin points to a 2013/14 budget paper which showed the money would come from an increase in the Medicare levy, reforms to Private Health Insurance and retirement incomes and a range of "selected long-term savings".
That last pot included an increase in the tobacco excise and changes to fringe benefits tax rules.
Add it up and Labor says this ensured the NDIS was fully funded through to 2023.
However, most of Labor's savings appear to be an intention; they were never specifically dedicated (or in Government-speak "hypothecated") to fund the NDIS, as the Medicare levy was.
The Coalition argues that as a result, the NDIS will have an annual funding gap of $4 billion when the scheme is fully operational in 2019.
By that time, the states will pay about $10 billion and the Commonwealth just under $12 billion.
Of that cost, the Government expects $4.1 billion will come from the Medicare levy increase, $1.1 billion in redirected spending on existing disability programs and a further $1.8 billion in redirected spending from the states, leaving it $4.1 billion short.
The Government argues the gap will need to be plugged by spending cuts in the welfare portfolio or even a tax increase, but Labor remains deeply sceptical.
Topics: disabilities, health, health-administration, health-insurance, health-policy, australia
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