Quarter of a million Australians could be forced from disability support under proposed NDIS overhaul

A sweeping restructure of the National Disability Insurance Scheme would result in more than 240,000 participants exiting the programme over four years, according to Treasury modelling presented to a parliamentary inquiry examining the government's cost-cutting measures.

The figures represent a stark illustration of the scale of the proposed changes to Australia's flagship disability support system, which currently serves approximately 500,000 people nationally.

The cumulative impact of eligibility reforms

Health Minister Mark Butler disclosed in April that the federal government's NDIS overhaul would result in 160,000 fewer people on the scheme by 2031 compared to current projections. Treasury modelling now clarifies how this target would be achieved: through a combination of 80,000 fewer new entrants joining the programme and 240,000 existing participants being removed from the scheme.

Without the proposed changes, the modelling suggests 190,000 new participants would have been expected to join the NDIS between now and 2031. Under the government's plan, approximately 110,000 of those prospective participants would be diverted from accessing support altogether.

"The government has thought carefully about the changes," NDIS Minister Jenny McAllister told the parliamentary inquiry, signalling the government's confidence in the reform process despite the significant numbers involved.

Parliament examines unintended consequences

The inquiry examining the NDIS spending cuts is investigating the broader implications of the proposed changes across Australia's states and territories. The modelling has prompted concerns from disability advocates and support organisations about whether vulnerable Australians would fall through gaps in the safety net.

Ms McAllister indicated the government is awaiting the parliamentary committee's report before actioning any measures designed to address unintended consequences that may be identified during the inquiry process.

Context of the funding debate

The NDIS has been a subject of intense political scrutiny in recent years, with successive governments concerned about the rapid growth in scheme expenditure. The programme has expanded significantly beyond initial estimates since its inception, creating pressure on the federal budget.

The proposed reforms represent the government's most substantial attempt to control NDIS spending growth through participant eligibility changes rather than through adjustments to funding levels or support packages.

What's ahead

The parliamentary inquiry's report will be crucial in determining whether the government proceeds with the full scope of the proposed changes or whether modifications are made in response to identified concerns. Disability advocates have already flagged concerns about the potential impact on people with episodic disabilities and those with complex support needs.

Originally published by ABC News, 12 June 2026