Butler aims to cut the average annual plan spend by about $5000, down from $31,000 to around $26,000.
He also revealed plans for sweeping changes across NDIS eligibility, budget cuts and new requirements for providers.
Fraud and non-compliance, which has reportedly cost the scheme billions, will also be addressed.
Here’s what we know about the planned changes to the NDIS so far.
The NDIS was established to support people in Australia living with permanent and significant disability.
It provides funding that allows people with disability to access support services, assistive technology, home modifications and more.
The NDIS is government-funded and Butler said it was designed to support about 410,000 people.
Today, it supports more than 750,000 participants, and the overhaul is aimed at reducing that figure to 600,000 in the years ahead.
What are the planned changes to the NDIS in 2026?
Planned changes to the scheme include:
- introducing new eligibility assessments
- removing diagnosis lists to determine eligibility
- reducing the frequency of plan reassessments
- ending the roll-over of unspent funds each year
- cutting budgets for the “social and community participation” category
- expanding mandatory registration categories for providers
- introducing a new digital payment system
The changes won’t start coming into effect until July, at the earliest.
The government will introduce the National Disability Insurance Scheme Amendment (Securing the NDIS for Future Generations) Bill after the 2026-27 Budget is handed down in May.
The government has also indicated that more reforms will be introduced in the future.
Who will be eligible for the NDIS?
NDIS eligibility will be soon determined through functional assessment, not a diagnosis list.
A new eligibility assessment tool will be designed and introduced in January 2028.
It will be used to reassess existing participants and evaluate new applicants, and is expected to cut the number of participants by about 160,000.
Who is being removed from the NDIS?
Up to 160,000 people will be removed from the NDIS under the new eligibility rules in a bid to save billions.
Participants with lower support needs or higher functional capacity will be removed from the scheme, Butler said.
How will the NDIS changes affect people with autism?
Eligibility changes are likely to have a significant impact on participants with autism.
Many of those who have lower support needs and qualified for the NDIS through the diagnosis list will no longer be eligible.
That includes thousands of young children, many of whom will probably be moved to the government’s new Thriving Kids program, which was announced last year.
He did not provide an exact definition of “mild to moderate” autism.
The $4 billion state-run program does not exist yet and Queensland has already refused to sign on, leaving a big question mark hanging over the futures of children with autism who are moved off the NDIS under the government’s changes.
Will the NDIS changes affect providers?
Yes, though not all providers will be affected.
The proposed changes include a crackdown on unregistered providers by expanding the categories of mandatory registration.
Those categories will now include “higher risk activities” including personal care, daily living supports and supports provided in closed settings.
As a result, some – but not all – currently unregistered providers will need to get registered.
“We don’t need to monitor retail purchases from a chemist the same way we monitor close personal care of vulnerable people,” Butler said.
Will the NDIS changes affect support workers?
Mandatory registration changes for providers will likely have a roll-on effect on support workers.
Slashing average plan spend may also impact support workers, as individual NDIS participants may not be able to afford the same services from them.
Cuts to funding allocated to participants through the “social and community participation” category may also affect the services support workers can get paid for.
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