SDA funding refers to a new and innovative capital funding system for investors housing people with disability under the NDIS. This scheme funds providers who provide specialist built dwellings in order to improve the efficiency and costs to deliver the participants lifetime need for person-to-person (P2P) care. SDA funding is only provided for participants with extreme functional impairment and/or very high support needs (6% of NDIS participants) and those applying will need to undergo a strict eligibility process to receive the subsequent funding.
SDA funding can only be paid to a Registered SDA provider that is registered with the NDI. SDA providers must undergo frequent audits from the NDIS Quality and Safeguards Commission as well as registering each dwelling under the relevant SDA Housing Category and Dwelling Type. For the passive investor this is a complex world to navigate and as SDA providers, ADAPT Housing provide industry knowledg, expertise and services under a partnership agreement.
SDA is funded under the NDIS through individual participant plans and claims are processed on a periodic basis. This remains the case even where a participant has engaged a registered plan manager, or is self-managing their NDIS funds to ensure independence. Once the eligible participants receive funding in their plan they engage a SDA Provider and find an enrolled dwelling that meets their specific housing needs.
As opposed to all other NDIS funding SDA funding is solely provided for the investment of capital (i.e. the bricks and mortar ). Often this funding can work in tandem with many other supports including in home support (Supported Independent Living) and home installations (i.e Assistive technology).
In 2011, the Productivity Commission estimated that around 28,000 people (or 6% of NDIS participants) will require SDA funding at full scheme. Prior to the launch of the NDIS, it was estimated that there was enough existing specialist accommodation for 15,700 people, implying the need for enough new dwellings to accommodate an additional 12,300 participants. With the new funding model SDA is expected to total approximately $700 million in funding per annum for 28,000 people (or 6% of NDIS participants) over the next 20 years.
SDA funding represents a substantial injection of funds with the potential for very healthy returns for investors looking to enter the new and innovative marketplace . If you are an investor interested in providing new housing stock talk to ADAPT today about possible investment models.
In addition to increasing overall funding, the NDIS changes the way SDA funding is provided. Instead of funding SDA through centrally managed capital grants programs that provide block funding to providers, the NDIS provides SDA funding directly to participants after determining their eligibility and appropriate budget amount.
Eligible participants can make their own decisions to find and enter into agreements with a suitable registered NDIS provider. This is consistent with the emphasis on participant choiceand control across the NDIS. Moving to an individualised, participant led funding model has several benefits:
- SDA funding is spent based on participants’ choices on where they would like to live, rather than government agency decisions on the merits of provider grants applications;
- Through participant choices, funding can flow to a wide range of providers of varying
scales offering new and innovative solutions, rather than being limited to incumbent players who are familiar with grants processes or established models of accommodation and support; and
- Funding levels are consistent and smooth across years, as they are linked to participant needs, rather than being tied to “lumpy” grants rounds and decisions.
Participant purchasing power will drive greater competition, stimulate innovation and create incentives for providers to be more responsive to the needs and preferences of participants. Over time SDA funding will increase the availability of accommodation and support models that provide for greater choice than what has historically been available under state and territory systems.
Yes. SDA funding under the NDIS is a legislated commitment of Australia’s Commonwealth, State and Territory governments, set out in the NDIS SDA Rules (2016) under the NDIS Act (2013). This legislation provides the foundation for government’s long-term and firm commitment to SDA funding under the NDIS. Beyond the legislative commitment, SDA funding enables eligible participants to achieve better outcomes while representing value for money for the NDIS. This is due to high-quality fit-for-purpose dwellings making it easier and less expensive to provide the range of personto-person supports that SDA eligible participants require. Improved design in SDA dwellings can reduce person-to-person support needs, and allow for choice in models that utilise shared supports. Broad benefits to all parties including participants, providers and the NDIS underpin the longterm commitment to SDA funding.