The Ministry of Disabled People Whaikaha is now under Cabinet oversight, with any changes it wants to make to do with funds that impact frontline services needing to be signed off at the highest level.
Finance Minister Nicola Willis confirmed there would be extra cash for the ministry, but that anything further it wanted to do would need to be checked first.
“Cabinet has agreed to ensure that the ministry has the funding it needs to get to the end of the financial year; the last government didn’t provide them with enough funding to get to the end of the financial year, so we’ve made that decision,” she said.
“We’ve also directed, as a Cabinet, that any further decisions that ministry makes about changing its criteria, its funds, needs to be properly consulted, properly sequenced and needs to go to Cabinet before they enact it.
Labour leader Chris Hipkins described it as an “extraordinary step to take”.
“It’s basically saying that the minister is not able to make decisions in their own portfolio without going to the whole of Cabinet. It’s a massive vote of no confidence in Penny Simmonds by the Prime Minister and by her Cabinet colleagues.”
But Simmonds, the Minister for Disability Issues, disagreed.
“We realise that there are some systems and processes that are missing in Whaikaha, we’re intending to do a review to look at those systems and processes and so in the meantime it’s really important that we keep Cabinet abreast of anything that is changing in there.”
Simmonds would soon bring a paper to Cabinet outlining the terms of reference for the review.
The review would be an external one to help Whaikaha improve its financial management and processes, and to address the broader policy settings for disability support services.
Whaikaha confirmed it would not be reversing its changes to purchasing guidelines while the review was being undertaken.
“The changes to the purchasing rules will remain in place. Whaikaha will work through the longer-term settings, which will be developed working with disabled people, tāngata whaikaha Māori and whānau,” deputy chief executive Hayley Evans said.
“The additional funding will ensure that Whaikaha can continue to fund critical supports and services, for example equipment and modification services, and address our forecast overspend across the disability support system.”
Simmonds said this was appropriate.
“Because even with the additional funding, there is still a real risk of them running out of funding.”
The amount given to the ministry ahead of the Budget is unknown at this stage due to sensitivity, however the ministry has frequently needed top-ups between Budgets.
Last year it received $41.2 million, in 2022 it was $31m, no extra funding was required for the 2021 financial year but for the year ended 2020 disability support services (which was then still within the Ministry of Health) required $103.7m to meet its cost pressures.
Figures provided by Whaikaha show every year from 2016 (apart from 2021) additional funding has been required.
The purchasing guidelines, a set of rules that sets out what can be purchased using the various streams of government disability funding, were significantly narrowed in a note issued by Whaikaka out of the blue last week.
Simmonds said the ministry was forecasting a budget overspend of between $50m and $65m for the current year.
It was clear there needed to be “major improvements” to the service delivered and the way Whaikaha communicated with the disabled community, she said.
“Given the ministry has required additional funding to prevent spending over its allocation, Cabinet has instructed the ministry that any future changes to criteria and funds that impact frontline services must be properly consulted on with the community and go to Cabinet. The Government will also undertake a review to understand and fix the ongoing issue of yearly cost overruns.
“We all want to see the best outcomes for the disabled community and their families, and I will work to maximise the support that is provided to the community.”
