The funding crisis facing the disability sector has become more urgent following the disturbing news that the Ministry of Health will not increase contract prices for providers this year, the New Zealand Disability Support Network said today.

“The refusal to increase funding that’s provided to the organisations which support some of the most vulnerable people in our society is a national disgrace,” said Dr Garth Bennie, chief executive of the New Zealand Disability Support Network.

“We estimate that this decision will widen the gap between annual funding and the real costs providers face from 12 percent to 15 percent. In dollar terms, this means the sector will now be at least $200 million short every year.

“What this really means is there will be less money to do more as costs rise and demand for services grows. Providers are already facing a funding squeeze from pay equity adjustments and new collective agreements.

“These added pressures leave providers with very difficult choices. Many are now considering their viability and just how solvent their organisations actually are. This is unsustainable.

“Some organisations facing acute funding problems will now have to think seriously about whether they can even continue to accept new clients.

“This will impact the lives of all disabled people and their families as providers have to spread the available resource more thinly. This will compromise quality and safety, particularly for those with higher support needs.

“It’s simply cutting by stealth despite the Government’s promise to prevent exactly this.

“We welcomed the recent boost to Funded Family Care and the small targeted increases for the sector in the Wellbeing Budget like employment support and community participation.

“But these just scratch the surface while ignoring the bigger problem of rising costs and growing need.

“For example, the Government’s own regional trials of a new delivery approach - “Enabling Good Lives” – which gives disabled people more control over their services, has revealed a huge untapped need. These trials have shown there could be 25 per cent more people eligible for support.

“This situation can’t be allowed to go on. We had high hopes the Wellbeing Budget would be transformational. We have heard the rhetoric about kindness. We are told this is the ‘year of delivery.’

“These feel like empty words. Our patience is fast running out. For now, we remain committed to constructive discussions with officials in the hope we can secure real action to fix a broken system that thousands of disabled people are depending on,” said Dr Bennie.

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