05/11/2013 - 15:46

Caution on NDIS cost: survey

05/11/2013 - 15:46

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While not-for-profit directors are generally supportive of the federal national disability insurance scheme, there is concern that the policy does not consider the long-term impact of the intended changes.

Caution on NDIS cost: survey
EXPERIENCE: David Gilchrist says changes in government policy can lead to for-profit operators cherry-picking high-margin services. Photo: Attila Csaszar

While not-for-profit directors are generally supportive of the federal national disability insurance scheme, there is concern that the policy does not consider the long-term impact of the intended changes.

Respondents to the fourth annual Director Social Impact Study, undertaken by Curtin University on behalf of the Australian Institute of Company Directors, remain wary the NDIS could place an unintentional financial burden upon disability services providers.

The annual survey aims to determine the contributions made to NFP organisations nationwide by their boards’ directors.

Perth-based David Gilchrist collated and analysed the results and said doubts remained over the long-term costs of the NDIS.

“We have previously seen examples in the aged care and childcare sectors where changes in government policy saw the entry of for-profit operators that tended to skim the high margin services,” Professor Gilchrist said.

“Directors want the federal government to recognise the importance of building sector capacity strategically, and not simply leaving development to competitive forces.”

More than 2,100 respondents participated in the Commonwealth Bank-sponsored survey, with further research gained from eight focus groups that consisted of members and non-members of the AICD.

The study also found that NFPs were actively seeking to decrease their reliance on government funding, with only 39 per cent receiving more than half of their income from this source.

Commonwealth Bank not-for-profit sector banking general manager, Vanessa Nolan-Woods, was encouraged that more than half of NFPs had identified this area as a priority.

“Diversified fundraising is the key,” Ms Nolan-Woods said.

“Truly sustainable organisations are those that look for innovative ways to diversify income streams, improve the flow of funds … and ensure that they have a strong investment policy that allows them to build reserves to ride out the tough times.”

In 2012, it was found that 86 per cent of NFP directors were unpaid, and this year’s survey delivered similar results.

The amount of time directors contribute to their NFP organisations has increase steadily during the past three years.

On 2013 figures, NFP directors dedicate an average of 27 hours per month to the organisation, up from 23 hours last year and 20 hours in 2011.

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