The Future of Psychosocial Supports in Australia– Are the Recommendations from the National Disability Insurance Scheme Review the Answer?

Abstract

The introduction of the National Disability Insurance Scheme (NDIS) in 2013 and the resulting changes in mainstream funding for psychosocial supports have led to disparities in funding between the two existing systems. Currently, people supported under the NDIS receive significantly more funding compared to those supported through federal and state programs. The NDIS review has highlighted this inequity, prompting a commitment to increase state and federal funding for foundational psychosocial supports. However, the specifics of this funding remain unclear. This article synthesises and critically evaluates the recent NDIS review recommendations relating to psychosocial disability and makes recommendations on how both systems could be enhanced to ensure equitable and accessible psychosocial support provision in Australia.

Introduction

The NDIS, introduced in July 2013, provides tailored support for individuals living with severe and persistent disabilities, including those that result from a mental health condition. Supports aim to enhance daily functioning and improve social connections (Commonwealth of Australia, 2023). The transfer of funding from previous state and federal government mental health programs (e.g. Partners in Recovery (PIR), and, Personal Helpers and Mentor Scheme (PHaMS)) into the NDIS inadvertently created disparities and gaps in service delivery for individuals not eligible for NDIS funding and those reliant on broader community mental health services (Mental Health Australia & National Mental Health Consumer & Carer Forum, 2024).

Currently, two key systems provide psychosocial supports in Australia: the NDIS and the broader network of state, territory, and federally funded programs. While the NDIS delivers individualised, long-term support for people with significant functional impairments, it serves only a subset of those with psychosocial disabilities. Access to the NDIS is primarily based on the severity and permanency of a person’s functional impairment. In contrast, the broader mental health system comprises multiple, often fragmented programs, including state-funded community mental health services, federally funded primary care initiatives, and various local government and non-government services. These programs vary significantly across and within states and territories in terms of funding, service availability, and eligibility criteria. Importantly, access to these services is often determined by situational factors, such as recent discharge from inpatient care or experiences of homelessness, restricting broader, more equitable access to support (Health Policy Analysis, 2024).

Despite significant transformations in the disability and mental health care landscape since 2013, recent reviews of the NDIS rollout have revealed substantial gaps between the intended scope of the NDIS and the reality experienced by many individuals in need (Devine et al., 2022; Hamilton et al., 2024). These gaps, identified in a series of reviews undertaken, highlighted challenges such as lack of timeliness and clarity on the NDIS decision making processes combined with a lack of information to assist people navigating the NDIS (Smith-Merry et al., 2018; Tune, 2019). Furthermore, the disparity between the NDIS’s disability-centric approach and the strength-based recovery ethos driving modern mental health has been highlighted as problematic (Williams & Smith, 2021).

Modelling undertaken by the Productivity Commission in 2011 (Productivity Commission, 2020) indicated that only 10% of individuals living with severe mental illness would meet NDIS eligibility criteria, leaving the majority reliant on mainstream mental health supports, often struggling to access adequate support or navigate a fragmented system ill-equipped to meet their needs. Supports offered by mainstream and community services vary by program, with eligibility often dependent on the severity and complexity of the person’s mental health needs, as well as their location or personal circumstances.

In response to these challenges, calls for action have intensified. Recent reports emphasise the importance of stakeholders working collaboratively to ensure that the system infrastructure supports quality outcomes for people with psychosocial disabilities and sustainable service provision for providers (Mental Illness Fellowship Australia (MIFA), 2023).

Psychosocial Supports and the NDIS

Supports funded by the NDIS are built upon the principle of individual control over needed services (Carey & Dickinson, 2017). Under this framework, individuals are allocated budgets based on their assessed needs, surpassing the support levels provided by existing Federal and State government-funded programs. As of December 31, 2024, there are 64,516 people with a primary psychosocial disability, representing 9% of Scheme participants, with an average yearly budget of $86,600 (National Disability Insurance Scheme (NDIS), 2025). However, access to these supports continues to be challenging and many individuals find the NDIS application process overwhelming. An analysis of exit data from transitioning Commonwealth funded programs indicated that only half of the clients chose to apply to the NDIS, with 50% found eligible (Hancock et al., 2019). Consequently, some eligible individuals may opt not to apply for NDIS support, relying on limited mainstream supports, despite likely meeting the access criteria outlined by the scheme.

Psychosocial Supports Outside of the NDIS

Psychosocial supports outside the NDIS are crucial for individuals not meeting access criteria or needing less intense, episodic, or short-term support. These community-based services, designed to assist individuals in living well within their communities, complement clinical mental health services in tertiary and primary care settings. Primarily commissioned through 31 Primary Health Networks (PHNs) and operating under a strength-based recovery model, these services fill a crucial gap, particularly for the “missing middle” - those needing longer-term supports below NDIS thresholds (Rosenberg, 2017). With rising NDIS demand, there is recognised need for a complementary program of community psychosocial supports that are cost-effective, sustainable, flexible, recovery-oriented, and easily accessible for those ineligible for the NDIS (Mental Illness Fellowship Australia (MIFA), 2023).

The NDIS Review

The NDIS review (Commonwealth of Australia, 2023), initiated in 2022, aimed to reevaluate the scheme’s core principle of empowering individuals to take control of their own care while also ensuring its long-term sustainability. Recommendations, delivered to the government in October 2023 and released publicly in December 2023, included 28 action items, several of which were specifically focused on addressing psychosocial support needs. These recommendations proposed:

• (#1) Funding foundational supports to provide greater support to people with disabilities outside of the NDIS, with targeted foundational supports specifically for psychosocial disability. Foundational supports are defined as specific supports outside the NDIS designed to assist people with disability, as well as their families and carers (Australian Government, 2024).Two types of foundation supports have been proposed:

• General supports, which include information and guidance, peer supports, and capacity building.

• Targeted supports for people with additional support needs who do not require access to the NDIS to have those needs met.

• (#2) Introducing specialist psychosocial navigators to assist individuals with psychosocial disabilities, regardless of NDIS eligibility, navigate the NDIS, foundational and mainstream supports.

• (#3) Implementing an early intervention pathway within the NDIS offering recovery supports for up to 3 years for people with psychosocial disability. After this period, individuals needing lifelong NDIS support would transition to the permanent disability pathway.

• (#4) Requiring providers of psychosocial supports to be registered and possess expertise in strength-based recovery.

• (#5) Funding budgets at the whole-of-plan level to enhance flexibility in determining necessary supports to address disability-related needs.

While most of these recommendations are still being considered, a meeting of federal and state governments in December 2023, agreed to fund foundational supports (#1) and announced the foundational support strategy with consultation currently underway. This strategy aims to bridge the gap between NDIS and non-NDIS systems through prioritising responsive services that enable all people with disabilities to actively engage in their communities.

Concurrent with the NDIS review, the Australian Government, under the National Mental Health and Suicide Prevention Agreement, examined unmet needs and service gaps. This review identified that 230,500 people with severe mental illness and a further 263,100 people with moderate mental illness would benefit from psychosocial supports but are unable to access them (Health Policy Analysis, 2024). Findings from this report, along with consultations with the mental health sector, will inform the delivery of future psychosocial supports from July 2027. Both these reviews provide the ideal opportunity for Australia to create a cohesive and comprehensive system of support for people experiencing psychosocial need.

What Should a Well-Designed Psychosocial Support System Look Like?

Greater Supports for Individuals not Meeting the NDIS Access Threshold

Modelling undertaken as part of the NDIS review (Commonwealth of Australia, 2023) indicates that most people with psychosocial needs will require supports beyond the NDIS, including a combination of foundational, community and mainstream supports. These supports should be unrestricted in duration and encompass home and living assistance, including transport assistance. Further, additional discretionary funding for activities or service gaps should be allocated to each person—an essential aspect of previously funded Commonwealth mental health programs (Nous Group, 2021). Evaluation of the Partners in Recovery programme indicated that discretionary funding enabled participation in recreational activities and reduced stigma (Jones et al., b2016; Nous Group, 2021; Trankle & Reath, 2019). Finally, supports should be available on weekends or after hours, a feature currently offered by the NDIS but lacking in most mainstream services (e.g. Head to Health).

Greater Emphasis on Recovery and Capacity Building Within the NDIS

A major criticism of the NDIS has been its insufficient focus on recovery and capacity building for people with psychosocial disability (Rosenberg et al., 2019), which has contributed to the lowest rate of employment outcomes (10%) among all disability groups in the scheme (National Disability Insurance Scheme (NDIS), 2020). While providing core supports (such as meal preparation and gardening) addresses the functional impacts, it may not be sufficient to promote long-term recovery and participation. Evidence from the former Commonwealth-funded Personal Helpers and Mentors Scheme (PHaMS) showed that strength-based, collaborative goal setting through individualised recovery plans improved social and economic participation among people living with mental ill-health (Dunstan et al., 2014). Shifting towards a more recovery-orientated approach under the NDIS would require both staff and providers to have adequate training and skills in mental health recovery, which are currently lacking (National Mental Health Consumer & Carer Forum (NMHCCF), 2023). This upskilling of staff could potentially be achieved through the implementation of the recommendation concerning the registration of psychosocial providers (#4). The registration of psychosocial providers is crucial to ensuring quality, consistency, and accountability in the delivery of services for individuals with psychosocial disabilities across the sector, particularly for participants with complex needs (Commonwealth of Australia, 2023; Productivity Commission, 2017). However, some stakeholders have expressed concerns that mandatory provider registration could limit participant choice and increase administrative burdens, particularly in areas with fewer registered providers (e.g. rural and remote areas) (Commonwealth of Australia, 2023; Productivity Commission, 2017).

Introduce Service Navigators to Assist People Move Between Various Support Systems

Effective service navigation is essential in guiding individuals through the complexities of the NDIS, mental health, and health systems; an approach that is highly appreciated by service users (Rattray & Shelby-James, 2025). Literature from the Partners in Recovery programme provide valuable insights into the role of service navigation of mental health service delivery in Australia (Cheverton & Janamian, 2016; Trankle & Reath, 2019). The proposed psychosocial navigators outlined in the NDIS review (#2) aim to address the challenges of navigating the NDIS, health and mental health sectors, but their success will rely on cohesive collaboration across sectors to develop interconnected processes. Beyond facilitating access to psychosocial supports, navigators must also proactively identify and assist individuals access services promptly. Indeed, proactive outreach has been demonstrated to be essential in ensuring equity of access to psychosocial services, especially for people experiencing significant disadvantage such as homelessness (Tune, 2019).

Conclusion

The Australian psychosocial support landscape is complex. While the NDIS strives to support those living with psychosocial disabilities, challenges endure, such as gaps between intent and reality and access disparities. In the coming year, we have a unique chance to utilise insights from various reviews and consultations to collaboratively design a comprehensive, cohesive approach to providing recovery-oriented support for individuals living with psychosocial disabilities.

Declarations

Conflict of Interest

The author(s) declare no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.