Medicare levy hike to pay for NDIS

Taxpayers will split the bill for the national disability insurance scheme through a 0.5 per cent hike to the Medicare levy. The Turnbull government has also earmaked more than $200 million to establish an independent commission to scrutinise the quality of NDIS providers and enforce the rights of participants.

Treasurer Scott Morrison says there is a $55.7 billion funding gap in the NDIS over the next 10 years, and previous efforts to plug the gap with budget savings have failed.

Instead, the government will legislate to increase the Medicare levy in two years when the extra bills start rolling in.

"Even if we are not impacted directly, this is all our responsibility," Morrison said in his budget speech to parliament on Tuesday 10 May 2017. "Our decision to increase the levy reflects the fact that all Australians have a role to play."

The increase to the Medicare levy from July 2019 in expected to raise an extra $2.55 billion in revenue in its first year, rising to $4.25 billion in 2020-21.

The increase means that from 2019-20, one-fifth of revenues raised through the Medicare levy will be injected into an NDIS savings fund (currently before parliament), where it will be protected for meeting the needs of people living with disability.

The Turnbull government has set aside $209 million over four years for an NDIS Quality and Safeguards Commission.

The 300-person strong commission will uphold national standards and ensuring clarity on the rights and responsibilities of participants, providers and their staff. The commission, an independent statutory body to be established in early 2018, will register NDIS providers and oversee their quality. It will also respond to complaints and manage reportable incidents such as the abuse or neglect of participants. So too will the commission reduce and eliminate practices such as the use of physical restraints.

The budget also contains $33 million workforce package to ensure NDIS participants and aged care users can access quality services in their local area.

At full scheme, the NDIS is expected to support 460,000 people at an annual cost of roughly $21 billion.

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