Health Minister Mark Butler Announces Aged Care Reforms and NDIS Overhaul in Pre-Budget Speech

Health Minister Mark Butler has unveiled major reforms to Australia’s National Disability Insurance Scheme (NDIS) and aged care system in a pre-budget speech at the National Press Club in Canberra on Wednesday, April 22, 2026, aiming to curb soaring costs and strengthen integrity across both programs.

Butler announced that the NDIS, currently supporting 760,000 participants, will see its projected enrolment reduced to about 600,000 by the end of the decade due to tighter eligibility rules based on functional capacity rather than diagnosis alone. This change is expected to result in approximately 160,000 people transitioning out of the scheme once the new rules take effect.

The targeted cost of the NDIS for 2030 has been reset to $55 billion, down from the current forecast of over $70 billion. Last financial year, the scheme cost $48.5 billion and is expected to exceed $50 billion in the current year. Under the reforms, average annual spending growth will be limited to just 2 per cent before returning to 5 per cent from 2030 onward.

To combat fraud and misuse, Butler described the NDIS as having been treated like “an ATM for shonks,” citing evidence of infiltration by organised crime and professional fraud syndicates, as noted in a recent submission by the Australian Criminal Intelligence Commission. Registration for NDIS providers will now become mandatory, with currently less than 10 per cent of providers in the scheme registered.

A hard cap will be placed on social and community participation costs, which have tripled from $4 billion to over $12 billion in five years and were projected to reach $20 billion by 2030. The government will reset this expenditure to last year’s levels and prevent further runaway growth. Average plan spending per participant will be reduced from about $31,000 this year to around $26,000 over the next two years.

As part of the overhaul, $200 million will be allocated to establish an Inclusive Communities Fund aimed at rebuilding capacity among disability organisations to support local participation and inclusion outside the NDIS framework.

In aged care, Butler announced the reversal of a policy that introduced out-of-pocket fees for essential home care services such as showering, dressing, and continence management. $1 billion will be directed into the Support at Home program to make these services free of charge for approximately 350,000 older Australians receiving home care packages, whether they are full-time pensioners or self-funded retirees.

$3 billion will be invested to deliver more aged care beds, home care packages, and improved care quality. The private health insurance rebate for Australians over 65 will be reduced to the standard level applicable to all other age groups, with the savings redirected into aged care funding.

The aged care system is forecast to cost more than $40 billion this year, while the NDIS bill is expected to reach $50 billion, placing both among the five fastest-growing areas in the federal budget. Butler emphasized that without urgent reform, the NDIS “simply will not be there in the future for the Australians who need it most.”