Where the 8% target came from
In 2023 National Cabinet, which brings together the Prime Minister, premiers and chief ministers, agreed an NDIS Financial Sustainability Framework. It set a target for annual growth in the total costs of the scheme of no more than 8% by 1 July 2026, with further moderation of growth as the scheme matures.
The Minister has said the scheme was on a growth trajectory of 22% when the current government came to office in 2022.
The new 5 to 6 per cent target
In his National Press Club speech on 22 April 2026, the Minister said that earlier in 2026 National Cabinet had agreed to target growth of 5 to 6 per cent, or lower. He described the 8% target as not sustainable indefinitely, and said that without further action the scheme would not reach 8% until the end of the decade.
He said spending would grow by an average of around 2% a year over the forward estimates while many design features are reset, before returning to 5% growth from 2030. He also said the states now have much greater funding responsibility for the scheme after that National Cabinet meeting.
What the target is, and what it is not
The growth target applies to the total cost of the whole scheme. It is not a cap on your individual plan, and the NDIA does not divide it among participants. Your funding is still decided through the rules for your plan, such as the reasonable and necessary criteria.
The target does shape those rules, though. Most of the reforms passed in 2026 are designed to slow spending, and from 1 February 2027 the NDIA must consider the sustainability of the NDIS when deciding what is reasonable and necessary.
The reforms linked to the target
The government's impact analysis says its NDIS reforms deliver on the commitment to reduce annual growth to 5 to 6 per cent or lower. Changes that affect spending include:
- The funding reset from 1 October 2026: 50% less for social, economic and community participation and 10% less for improved daily living skills, applied when plans are created, reassessed or renewed
- From 1 February 2027, renewed plans no longer roll over unspent funds
- New framework planning from 1 April 2027, with budgets set from a support needs assessment
- Thriving Kids, with children 8 and under with developmental delay or autism and low to moderate needs supported outside the NDIS from 1 January 2028
- New eligibility rules based on functional capacity from 1 January 2028
- The Minister setting price limits since 27 August 2026
What it means for participants
Expect closer scrutiny of plan increases and of supports that are not clearly linked to your disability and goals. Clear evidence, careful use of your funding and records of any changes in your needs matter more than before.
If your needs change in a significant and ongoing way, you can still ask for a plan variation or an unscheduled reassessment. If you receive 24 hour support, check whether the high support needs plan variation applies to you.
What it means for providers
Slower growth means more competition for participants and more pressure on prices. The Minister now decides price limits, and differentiated pricing for unregistered providers is under consultation. Providers who can show clear outcomes, keep good records and fill gaps in thin markets are best placed as the scheme tightens.