Eight providers of disability employment services are set to be effectively shut down by the federal government as part of a wide-ranging overhaul of the sector.
From Sunday, 52 of the 104 DES providers nationally will begin to be contacted and informed that some or all of their services will end due to poor performance.
While most will be able to continue offering some services, eight will lose funding for all of their services.
Social Services Minister Amanda Rishworth said despite warnings, some organisations still failed to provide adequate support for people with a disability.
"Poorly performing DES providers were given every opportunity to put measures in place to improve and were aware of the formal review process," she said.
"It is vital that funding is directed to organisations who have proven they are delivering the best support to participants."
The dramatic steps follow a months-long review into the sector in the wake of the disability royal commission.
It heard evidence that many DES providers were not achieving long-term outcomes for clients, with job placements ending abruptly, or in some cases only lasting while subsidies were being paid.
Complaints were made of providers focusing on those clients most likely to find work, while "parking" more disadvantaged jobseekers and paying them little attention, or churning others through activities for little benefit.
More than 15,000 people with a disability will be affected, as six per cent of services operated by DES providers nationwide are shut down.
They will be moved to different providers nearby, and "mutual obligations" — any requirements for them to seek work to earn disability support payments — will be waived for two months as the transition occurs.
Ms Rishworth said the changes mean those people will be placed in better-run services, and will have more opportunity to find work.
"We believe that there is enough capacity in the system to properly support those 15,000 people that will be transitioned to other services," she said.
"People living with disability deserve the best possible service in helping to find employment."
Providers with hundreds of clients finding handfuls of jobs
The review began in March under the former Morrison government, after it was first flagged towards the end of last year.
Providers subject to the review due to ongoing poor performance were notified in writing.
One provider with roughly 650 clients received close to $900,000 in government funding throughout 2021, but placed just six people in jobs that lasted half a year or longer, and only one that lasted more than a year.
All of its services are being ended.
Ms Rishworth said the moves are necessary to give people with a disability who need support the best chance to get into employment.
"We are taking action to ensure people living with disability and who want to work get every opportunity to do so in a meaningful way," Ms Rishworth said.
"Everyone deserves the opportunity and dignity of work, including people living with disability."
