NDS financial sustainability report signals need for better pricing and planning
NDS has released a report that provides a detailed analysis of the financial sustainability of the disability sector in Australia. This is the second report of the Market Design and Evolution for Better Outcomes Research Program (also known as the Disability Services National Benchmarking Project).
The research was led by Prof David Gilchrist from The University of Western Australia. It examines the financial performance of a panel of 154 disability service providers (providers) between 2014/15 and 2015/16, as they transition into the National Disability Insurance Scheme (NDIS).
Key findings
- Panel members' rating of their organisation's financial performance declined. In 2014/15, two-thirds of panel members rated their organisation as strong or very strong, but this dropped to 44 per cent in 2015/16. Optimism about future financial performance was also weaker.
- Aggregate donations and bequests remain a significant contributor to sector income, representing more than 3 per cent of total income in 2015/16. This is an essential resource for organisations that are not able to break even from the provision of services, but can be volatile and therefore adds risk to service provision.
- Nearly three quarters (73 per cent) of the panel reported that demand for their disability services increased during 2016, but a third (33 per cent) reported they were unable to satisfy all requests for service. The same proportion (77 per cent) expected demand for their services to increase during 2017 and, again, 32 per cent expected they would not be able to meet demand.
The research further emphasises the findings of the first report released in 2016 about the concurrent challenges of growth and transition. Organisational respondents are fully supportive of the NDIS policy, but many are experiencing financial stress, are concerned about the viability of their disability services and do not expect to meet demand for services in 2016/17.
Similarly, the report echoes concerns raised by NDS and recently in research by UNSW that NDIS pricing is a constraint to quality services and decent jobs.
Go to the NDS website to read more, and download the report.
