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The NDIS was founded upon a three-tier system, with each tier providing a critical and unique contribution to the overall system of support and care for disabled people. Like a three-legged stool, the removal or weakening of any one of these tiers would fundamentally destabilase the entire NDIS.

Tier 2 was originally designed to provide for a robust community-based support system, which could offer services not only to NDIS participants, but also to the roughly 4 million disabled people who fell outside of the Tier 3 individualised service provision. The primary forms of support provided in Tier 2 are information and referral services, rather than funded care and support.

Many Tier 2 service providers predate the NDIS, and have traditionally relied heavily on donations and volunteers to remain viable. However, COVID and rising costs of living have reduced the capacity of many volunteers, and economic pressures have resulted in a decline in donor flows, at the same time as overheads have risen.

This research paper examines two key trends of concern relating to the provision of Tier 2 services:

  1. The changing structure of federal and state funding for Tier 2 services, and;
  2. The declining level of volunteering in the sector, upon which, in the absence of appropriate funding, many Tier 2 organisations are increasingly dependent.

This report highlights the declining, sporadic and unpredictable nature of Tier 2 funding. Such funding arrangements are anathema to the creation of a community-based support system since community-based organisations are particularly vulnerable to unpredictable cash flows.


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