By M. Peterson
The long-awaited changes to New Zealand’s disability funding system were announced yesterday by Louise Upston. The Minister for Disability Issues claimed that the government has taken time to work through reforms aimed at creating a more consistent, transparent and fair support framework, restoring choice and control to disabled people and their whānau. However, underlining these changes are ‘hard limits’ to the amount of money the government is prepared to spend to meet the needs of disabled people, carers and family members.
On 18 March last year, then-Disability Minister Penny Simmonds suddenly announced that the government would be removing the limited flexibility, choice and control that disabled people had in spending their minimal levels of government funding. This announcement shocked the community, provoking nationwide protests and forcing the government into reverse gear. Simmonds was removed from her role and replaced by Louise Upston, who began a lengthy review with the disability community and carers. Meanwhile Equipment and Modification Services Budgets had been quietly capped with no input from our community, despite the fact that twice as many of us access these services than access flexible funding.
The government’s cuts were part of its austerity agenda. As Max Harris outlined in a 2024 article in the Post:
“cuts to social spending and services, this Government’s austerity agenda, need to be understood as a political choice, not an economic necessity.
New Zealand’s government spending as a percentage of GDP is lower than many European countries. New Zealand government debt is significantly smaller than similarly situated countries: the International Monetary Fund has called it “comparatively low”. There’s no spending or debt crisis driving the cuts.”
Austerity, in this light, reflects an ideological choice to shrink the welfare state rather than an absolute fiscal necessity.
In response to last year’s uproar, the government has acted on calls from disabled people for greater flexibility and autonomy over their own budgets, and from carers and families for meaningful involvement in the needs assessments conducted by funding providers. These voices will have a direct impact on the design of the new system, ensuring that personal support plans will not only aim to reflect each individual’s aspirations and priorities, but also recognise the insights and contributions of their whānau and carers. This is a victory for the communities that organised and fought back against the cuts.
Key Changes to disability funding are as follows:
Standardised Assessments
All Needs Assessment and Service Coordination (NASC) organisations will adopt a single assessment process nationwide to reduce postcode-lottery discrepancies and ensure equity in support allocation.
Removal of Purchasing Guidelines
The controversial March 2024 purchasing guidelines will no longer apply, allowing greater flexibility for individualised funding users within a defined budget.
Personalised Support Plans
Needs Assessment Coordinators will co-develop personal plans that focus on each person’s aspirations and needs, address barriers linked to their disability, and also consider family and carer requirements where relevant.
Budget-Based Flexible Funding
Flexible funding users will receive an individualised budget based on their past spending (including pre-March 2024). Guidance will be provided to help manage funds, and additional funding will only be granted via reassessment if circumstances change.
Phased Rollout
From 1 February 2026, all-new DSS users will be assessed under the updated system. From 1 April 2026, existing flexible funding users will transition to the budget-based model, and from October 2026 all NASC reassessments will follow the new approach.
Disability advocates emphasise the need for ongoing engagement with disabled people and their families to monitor the real-world impact of these reforms and tackle persistent financial inequities. The changes also fail to address the fact that the Accident Compensation Corporation (ACC) and Disability Support Services (DSS) currently operate two distinct funding models — one based on cause (ACC) and one on assessed need (DSS). The bifurcation of funding creates inequities for disabled people depending on whether their impairment stems from an accident or another cause. This creates complexities and problems for people with congenital disabilities being able to access the care that they need if, for example they have an accident.
We need systems that ensure fair, needs-based support for everyone. Disabled people should have access to support based on functional impact and individual needs, not how their impairment originated. We must guarantee ongoing access to critical services and modifications throughout the lifetime of a disabled person, avoiding arbitrary caps that leave people without necessary care.
Māori disability advocate Dr. Huhana Hickey does not believe the changes are adequate. Hickey told Waatea News:
“They’ve taken away the progression we were having towards us managing our budgets and having a good life — being able to visit, travel, go to the Koroneihana. I mean I would’ve loved to have gone to the annual anniversary, but I couldn’t go because I can’t afford to pay for my carer’s costs… the changes kick in two years after our flexible funding was taken away from us, and what they’re offering us is not the full flexible funding we had before.”
These latest reforms mark the first significant reversal of key funding changes since March 2024, directly responding to feedback from over 1,800 disabled people, families and carers during nationwide consultation this year. We have seen that coordinated protests do work in the long run, as they ensure that the voices of those most impacted by the government’s decisions continue to be heard. The Coalition only listens when we force them to listen.
While the government’s reversal has been welcomed, the fundamental ideology of austerity remains at the heart of the Coalition’s decision making. By understanding the breadth of austerity’s impact — from increased poverty and household distress to deaths in extreme cases — we can better advocate for reinvestment in disability services and policies that uphold social justice and equitable support.
M. Peterson is an activist from Auckland. She is the Treasurer of System Change Aotearoa.
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