Cracking down on fraud in NDIS and veterans affairs to save billions
Criminal gangs and fraudsters running amuck in Australia’s support services – from veterans’ affairs to childcare and the NDIS – will be targeted in the federal budget on Tuesday, as fears grow that debts will spiral due to a surge in dodgy payments.
Finance Minister Katy Gallagher said the $6.6 billion veterans fund had become a free-for-all market “similar to the NDIS” where dodgy doctors and firms exaggerated illnesses and skimmed payments for retired defense personnel.
In an interview with this imprint, he emphasized that the problem is dangerous companies exploiting the system, rather than veterans who deserve support and will continue to receive appropriate payments.
During the Coalition and One Nation’s campaign against suburban NDIS fraud, Gallagher said the government was aware of sophisticated criminal operations manipulating the NDIS, which included at least one transfer of proceeds to countries in Africa.
Online claim systems create loopholes that allow fraud to thrive, Gallagher said. While people benefit from generous programs after more than a decade of slow growth in living standards and declining trust in institutions, this poses a persistent problem for the government.
As the government looks to rein in near-record spending levels, cracking down on bad actors, led by the Fraud Fusion Taskforce, will be a top priority.
Gallagher said it was “always surprising” how quickly people try to take advantage of rich government schemes, including disaster relief schemes that are exploited by those not in the vicinity of the incident, adding that such behavior “makes you think the worst of people”.
“The NDIS experience is to follow the money wherever there are major government programmes,” he said.
“We have to make sure we do everything we can on all of these big programs.”
Finance Minister Jim Chalmers will present a budget on Tuesday promising a $45 billion improvement to the budget over five years. The radical overhaul to the NDIS, which will reshape the rules for participating in the scheme, is estimated to save up to $35 billion over four years.
Economists have warned that most of the increase in the budget will come from increases in commodity prices caused by the war. Labor has said the budget will not produce a surplus over the next few years, meaning the country’s almost trillion-dollar debt will go unpaid. Although the government has promised to save money with its policy choices, it has yet to publish key figures showing the extent to which its policy decisions will affect overall spending levels.
When Prime Minister Anthony Albanese came to power, the veterans’ compensation program was in shambles, with veterans waiting years for their claims to be reviewed. The Morrison government estimates $1.8 billion will be spent on former diggers’ compensation claims this year. But the program has grown to $6.6 billion each year as the government clears a huge backlog and tries to make sure veterans are treated fairly.
Labor MPs, speaking on condition of anonymity, said for-profit operators were known to increase interest in compensation claims by advertising veterans’ compensation options at RSL clubs.
The government saved more than $55 million from its veterans program in the first quarter of this year after introducing integrity measures. Tuesday’s budget will include more estimates on savings.
“What we’re watching with veterans is that it’s similar to the NDIS [in terms of] How the market will react,” Gallagher said.
“How do you ensure taxpayers aren’t left high and dry while veterans get the help they need?”
The coalition had been calling for major cuts to the NDIS for months and Labor ignored the opposition. One Nation uses its cartoon to attract attention reports Australian Financial Review Western Sydney’s ethnically diverse suburbs are hotspots for dodgy NDIS providers.
“We now have a government focused on funneling money to organized crime, fraud and corruption,” shadow treasurer Tim Wilson said on Monday.
The government announced last month it would rewrite NDIS eligibility rules to prevent the disability scheme from becoming the government’s most expensive stream.
Before entering politics, Gallagher helped integrate mentally disabled people into society. The government said the social and community engagement budget within the NDIS has tripled in five years to more than $12 billion and is on track to rise to $20 billion.
“We’d take people out of hostels and take them out for real community involvement, go to the movies, go out to dinner. People who could never go out,” he said. “That’s not what it costs.”
“I really don’t know what the Liberals did with the NDIS for 10 years. I know they’ll put all the blame on us but when we left [government in 2013]It was still in the embryo stage. When we come back after 10 years… [they were not] “I’m checking the bills.”
“The idea is that you’re allowing these plan administrators to create a whole new industry with just the click of a ticket, without any regulation, without any registration, without any regulation.” [NDIS agency] He doesn’t even know who he’s paying money to. I mean, it’s extraordinary.”
The coalition argues that Labor under Julia Gillard designed the NDIS and its flawed rules.
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Paul Sakkal is the Chief Political Correspondent. He has previously covered Victorian politics and won the Walkley award as well as the 2025 Press Gallery Journalist of the Year award. Contact him securely on Signal @paulsakkal.14.Connect with: X or email.
