National Disability Insurance Scheme added $52 billion to economy in 2020-21, research shows

New research from think tank Per Capita estimates that the National Disability Insurance Scheme (NDIS) has contributed more than $52 billion to the Australian economy in 2020 and 2021 alone.

The report ‘False Economy: The Economic Benefits of the National Disability Insurance Scheme and the Consequences of Government Cost-Cutting’ has been produced as part of a campaign against cuts to the scheme.

National Disability Services President Rohan Braddy said the report reinforces how the NDIS has proven both transformative for both economic and social reform. 

“We have been concerned to see the focus change over the past year from the benefits of the scheme to the cost, with ongoing attempts to restrict access to the scheme and reducing support available,” Braddy said.

How does the NDIS contribute to the economy?

In the conclusion to the report, the authors write that funding care-based government services is too often presented as merely a burdensome cost to the working taxpayer. Meanwhile, other sectors such as the defence sector are seen as providing cutting edge tech and high skilled jobs.

In reality, the caring economy is an effective creator of jobs, small business and local spending, say report authors Michael D’Rosario and Matt Lloyd-Cape. 

Indeed, according to Per Capita’s research the NDIS employs over 270,000 people in Australia, across 20 different occupations. It also likely contributes to the employment of tens of thousands of workers indirectly.

The report says a conservative estimate of how much the NDIS has contributed to the Australian economy in 2020 and 2021 would be around $52.4 billion.

How does the NDIS create jobs?

According to the report, the NDIS creates jobs for disability support workers, allied health professionals and physical therapists, to name a few.

It also creates jobs for the manufacture, sale and service of health equipment, as well as labour jobs, contractors and consultants. NDIS payments are also estimated to contribute widely to the national economy.

The report says that investment in paid care has led to formerly unpaid carers re-entering the workforce. Indeed, according to the NDIS’s 2020 report, the percentage of carers for 0 to 14-year-olds working in a paid job increased by nearly 10% between 2016/17 and 2019/20.

How would cuts affect the NDIS?

The report estimates that for every $1 billion the scheme is underfunded, there would be a loss of around 10,200 jobs and total economic activity would drop by around $2.25 billion. GDP would fall by around 0.14% and there would be a 0.22% reduction in the services economy. 

On the subject of GDP, it is also worth highlighting that unpaid care work is not counted as part of gross domestic product. This is despite a 2021 report from Global Citizen estimating that unpaid care and domestic work contributes between 10% and 39% to global GDP. 

The report says that around 16 billion hours are spent on unpaid care work every day and that it contributes more to the global economy than manufacturing, commerce and transportation. 

NDIS report writers say the focus should not be on cutting costs, but rather on using the scheme to encourage more workforce participation.

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