Amid last week's politicking on the National Disability Insurance Scheme (NDIS), Queensland Premier Campbell Newman revisited a previous proposal for funding the NDIS — a dedicated charge to the taxpayer, akin to the Medicare levy. While this strategy was a reasonable possibility when ongoing disability care and support first rose in public debate, the Productivity Commission recommended it as a second-best option for funding an NDIS.
There are good reasons why federal governments from both sides of politics avoid budget strategies which tie revenue to funding for almost all public policies in the long term.
Many forms of government revenue fund various expenses and public 'goods', and revenue received rarely matches the associated costs. Instead, revenue in the form of taxes and levies is based on citizens' and companies' obligations or market-driven willingness to pay. Likewise, expenditure is based on governments' responsibilities, political will and ability to pay.
Mechanisms for revenue-raising and budgeted expenditure reveal a government's policy priorities and values. Tying revenue to a particular expenditure purpose limits flexibility in delivering policy outcomes, and by implication, restricts the its ability to reflect community values in a timely manner. General purpose revenue and expenditure can have a redistributive effect.
In the Productivity Commission's Disability Care and Support Inquiry Report, in which it first proposed the NDIS, the Commission argued that the scheme should be funded from consolidated revenue on the basis that it was a core function of government akin to Medicare.
Currently, levels of disability funding wax and wane according to governments' budget resources, providing no certainty for those affected. A levy to fund disability support has similar potential to be viewed as discretionary, elective or temporary by successive governments or the community.
While it is heartening that there is general consensus between political parties on the NDIS, it is unfortunate that some state premiers' bickering over funding fuelled distress of affected people. In the last year, people with disabilities and caregivers have experienced many ups and downs.
After the report's release, the Liberal and National parties committed to supporting the NDIS at their respective Federal Council and National Conferences in the middle of last year. Labor announced its support and funding of $10 million to begin policy work on the scheme, along with a COAG Select Council to oversee the reform.
Then in December, shadow disabilities spokesman Mitch Fifield expressed reservations over funding. Various subsequent reports left readers to wonder whether the Coalition was as