People with high-value National Disability Insurance Scheme (NDIS) plans are being "kidnapped" and having their funding drained by providers that are supposed to help them live better lives, a bombshell report says.
The interim report also says people with disability who live in supported residential services (SRS) in Victoria are being "coaxed" into changing accommodation and service providers "through offers of fast-food 'treats' like KFC and McDonalds".
The government-commissioned report was produced by the Melbourne-based Mental Health Legal Centre (MHLC).
It found people with disability in Victorian SRSs – historically known as boarding houses – have been financially abused, neglected and manipulated by providers.
"Currently companies can collect residents, take them to undisclosed locations and siphon the funding from their packages," it says.
NDIS Minister Bill Shorten said the report came about after meetings with whistleblowers, and he suspected similar abuses were happening across the country.
"The NDIS is here to stay. It's changing people's lives," he told reporters in Melbourne.
"But there is no doubt that in the last number of years, the neglect and oversight of the system has seen vulnerable people with lucrative support packages fall through the cracks, and effectively be human trafficked."
Mr Shorten said the federal government had referred more than 50 providers to the National Disability Insurance Agency (NDIA), which runs the NDIS, as well as the NDIS Quality and Safeguards Commission and the Fraud Fusion Taskforce.
People with disability treated as 'human cargo for money'
SRSs are privately run operations that provide supported accommodation to older people and those living with disability.
Of the 4,000 people living in SRSs across Victoria, an estimated 1,600 are NDIS participants. The majority live with psychosocial and intellectual disabilities.
MHLC general manager Charlotte Jones said she was aware of around 70 people having been "kidnapped" across the SRS system.
"As a number of SRS facilities were closed, residents either disappeared … or were taken from facilities, often at night, and deposited into alternative accommodation," she said.
"Some have ended up in hospital, some were back at the SRS, and some have ended up back at other SRSs.
"We don't believe that they go understanding where they're going."
Ms Jones said she was shocked by the report's findings.
"I couldn't actually understand that people saw other people as human cargo for money," she said.
The report says there is "a strong profit motive to work with people living with disability without the necessary regulation to ensure protection from predatory business practices".
"‘Choice and control’ for people living with psychosocial disabilities in [SRSs] is only theoretical," it says.
"The current system enables, and in many cases facilitates and financially rewards, exploitative and coercive practices.
"These practices include limiting access to supports, neglect, emotional manipulation, bribery, financial abuse and kidnapping."
El Gibbs, director of policy and advocacy at Disability Advocacy Network Australia, said the report's findings were unsurprising.
"People with disability and their advocates have been raising issues with substandard housing for many years," she said.
"This abuse and exploitation of people with disability must stop, and it must stop now."
Ms Gibbs said that only last year, people with lived experience and their advocates told the disability royal commission about appalling rates of violence and abuse in these settings.
"Urgent action is needed from the NDIS, but also from state and territory governments, to make sure people with disability have a decent place to live, free from violence and abuse."
Ms Jones said she believed there would be "many more" people living in SRSs that were being exploited "we don't know about yet".
"Most people have them in their neighbourhoods … but people just don't see the residents," she said.
"And then it's really easy for them to be gone, and nobody's asking any questions."
Last week's federal budget included funding for an extra 200 NDIA staff to crack down on unethical providers, and more funds for the government's fraud taskforce and the NDIS Quality and Safeguards Commission.
A "mini-taskforce" within those agencies will be set up to specifically investigate SRS providers, Mr Shorten said.
He said a proposed Victorian law, currently before the state's parliament, would also increase safeguards. That law would give the state's disability minister the power to declare new types of accommodation for people to receive NDIS-related services.
