Australia’s controversial National Disability Insurance Scheme is losing billions of dollars more to fraudsters than previously feared, and officials now admit they have no idea how much money is being stolen.
Criminals fleeced the $44 billion NDIS – which is forecast to blow out to $100 billion in just two years – out of an estimated $8.8 billion in 2023, and officials now admit billions more may have been lost in overcharging.
NDIS investigators with the Fraud Fusion Taskforce (FFT) briefed state police forces late last year to ask for assistance cracking down on the rampant rorting of the scheme, The Sunday Telegraph reported.
“There are the criminals who deliberately rip the NDIS off with blatant fraud. But then there are the genuine providers who overcharge and embellish to the eyeballs, so something for $80 will cost $800 when the NDIS installs it,” a police source said.
“The NDIS is admitting the problem is far too big for them, but it’s just far too big for anyone really.”
The FFT worked with the Australian Federal Police to take down a western Sydney-based syndicate, three of whom who were sentenced in October to a combined 12 years and 10 months’ jail for cheating the NDIS out of $5.8 million, in 2021. Two others were sentenced in 2022, and one man remains before the courts.
The group allegedly used three NDIS companies to make millions in false claims by providing fake medical reports to obtain funding for people who were not disabled. They also allegedly fraudulently applied for tax refunds.
Police seized 8kg of gold bullion, $600,000 in cash, $635,176 in cryptocurrency, three luxury cars and jewellery during raids on the group.
Opposition NDIS spokesman Michael Sukkar responded to the revelations by saying it was “high time [Prime Minister] Anthony Albanese is honest with taxpayers on the true levels of NDIS fraud”.
A Nine newspapers investigation in 2022 found that Middle Eastern gangs were heavily involved in NDIS fraud, and that same year the boss of the Australian Criminal Intelligence Commission said as much as one-fifth of NDIS funding was being abused by crime syndicates.
The NDIS is set to cost taxpayers more than the aged pension within just over two years if current trends continue and the large-scale fraud is not reined in, with the current growth trajectory of 20% per year on track to push the scheme over $100 billion by 2027, making it the largest area of government spending.
The NDIS already costs $44 billion a year, more than the aged care system on $36 billion, Medicare on $32 billion, and hospital federal funding on $30 billion.
About 2.6 million Australians are on the aged pension, and as of May last year the NDIS had 660,000 participants.
The rapid growth in the NDIS has been attributed to a surge in child enrolments for autism and “developmental delay”, as well as widespread fraud, with 12% of boys and 6% of girls aged between 5 and 7 now participating.
18% of Australians (4.4 million people) are disabled, according to the most recent government data, and for 23% of those their main form of disability is mental or behavioural.
Another 22% of the population have a long-term health condition.
Header image: Australian Federal Police and NDIS investigators at a raid on a fraud syndicate in western Sydney, where vehicles were seized and six arrested (AFP)
