National Disability Insurance
Scheme: Service Agreement
Variation Process May 2017
Information sheet on funding withdrawals during financial yearend and roll-over processes
Contents
Key messages ............................................................................................................................................................. 1
End of financial year, roll-over and annual CSO indexation .................................................................................. 2
Reduction in individualised funding for Individual Support Packages and Futures for Young Adults .......................... 2
Reduction in block funding for Disability and Mental Health Community Support Services - for clients who
become NDIS participants up to 30 June 2017 ............................................................................................................ 2
Reduction in block funding for Disability and Mental Health Community Support Services - for clients who
become NDIS participants from 1 July 2017 ................................................................................................................ 2
Client data refresh and recalculation of block funding averages from 1 July 2017 ................................................. 2
Examples of funding withdrawal timing over financial year-end and service agreement roll-over................... 2
Unspent 2016-17 funds and service agreement funding sufficiency .................................................................... 3
Disability Services funding sufficiency ..................................................................................................................... 3
Examples of funding withdrawal across service agreements ............................................................................... 5
Key messages
• This information sheet relates to funding from the Department of Health and Human Services.
• The timing of withdrawals for Disability and Mental Health Community Support Services block funding will be
delayed during the financial year-end and roll-over processes.
• The timing of withdrawals for the Home and Community Care Program for Younger People will follow the in-kind
arrangements.
• Terminations of funding related to clients who become NDIS participants up to 30 June 2017 will be processed
as prior year adjustments in August 2017 and will be recouped from the September 2017 payment (except for
funding related to HACC-PYP providers participating in in-kind arrangements).
• Service providers should carry over any unspent funds into the 2017-18 financial year as the department will be
making retrospective service agreement variations back to a client's NDIS plan approval date.
• Block funding averages will be recalculated effective from 1 July 2017 and applied to withdrawals relating to
clients who become NDIS participants from 1 July 2017.
End of financial year, roll-over and annual CSO indexation
The department’s ability to withdraw funding relating to the NDIS transition will be restricted during the annual
process to roll-over service agreements and apply indexation increases on the Service Agreement Management
System (SAMS).
Details regarding the timing of funding withdrawals over this period are provided in the following sections.
Reduction in individualised funding for Individual Support Packages and Futures for Young Adults
The withdrawal of individualised funding as clients become NDIS participants will continue each month.
Terminations of funding for ISPs and FFYAs related to clients who become NDIS participants up to 30 June 2017
will be processed as prior year adjustments and will be recouped from the next available payment.
Reduction in block funding for Disability and Mental Health Community Support Services - for clients who
become NDIS participants up to 30 June 2017
Block funding withdrawals for in-scope disability services activities, including disability Supported Accommodation,
and in-scope Mental Health Community Support Services (MHCSS) will not be carried out in June or July 2017.
Withdrawals of block funding relating to clients who become NDIS participants up to 30 June 2017, and where
related funding has not yet been withdrawn, will be transacted in SAMS in August 2017.
These variations will be processed as prior year adjustments and will be recouped from the September 2017
payment.
These variations will use the 2016-17 block funding average for each provider and activity (and catchment area for
MHCSS).
Reduction in block funding for Disability and Mental Health Community Support Services - for clients who
become NDIS participants from 1 July 2017
Withdrawals of block funding related to clients who become NDIS participants from 1 July 2017 will commence on
SAMS in September 2017 and impact on provider payments and cashflow from October 2017.
These variations will be based on an updated block funding average calculated for each provider and activity (and
catchment area for MHCSS services).
Client data refresh and recalculation of block funding averages from 1 July 2017
The updated block funding average will be based on the client data collected in May 2017 and the service
agreement funding for the provider and activity. The funding will include the July 2017 indexation (and will take
account of any prior year adjustments to be transacted in August 2017.
Examples of funding withdrawal timing over financial year-end
and service agreement roll-over
The following tables provide examples of the timing of funding withdrawal.
Information sheet on funding withdrawals during financial year-end and rollover processes
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Table 1: Processing of funding withdrawals (in ISP system) over financial year-end and service agreement
roll-over for Individual Support Packages and Futures for Young Adults
Withdrawal
processing
month
April
May
June
July
Treatment
standard variation
Prior Year Adjustment (PYA)
Prior Year Adjustment (PYA)
for plan approvals up to 30 June 2017: Prior Year
Adjustment (PYA)
for plan approvals from 1 July 2017: standard
variation
Loaded
into
SAMS
Payment impacted from…
May
June
July
June
July - full recoupment for PYA
August - full recoupment for PYA
August
September - full recoupment for
PYA, cash-flowed for plan
approvals from 1 July
Table 2: Processing of funding withdrawals (in SAMS) over financial year-end and service agreement rollover for other in-scope Disability and MHCSS activities
Withdrawal
processing
month
April
May
June
July
August
September
Treatment
Payment impacted from…
standard variation
standard variation
n/a - no block funding withdrawals processed
n/a - no block funding withdrawals processed
for plan approvals up to 30 June 2017: Prior Year
Adjustment (PYA)
for plan approvals from 1 July 2017: no block
funding withdrawals processed
for plan approvals from 1 July 2017: standard
variation
May
June
n/a
n/a
September - full recoupment for
PYA
October
Unspent 2016-17 funds and service agreement funding
sufficiency
Service providers should carry over any unspent funds into the 2017-18 financial year as the department will be
making retrospective service agreement variations back to a client's NDIS plan approval date.
This will impact on future payments or, where the service provider has insufficient departmental funding remaining,
require the provider to return funds requested via invoice.
Unspent funds should be available in an account from which the organisation can withdraw funds rather than a
trust account.
Disability Services funding sufficiency
As departmental funding is withdrawn for clients who have become NDIS participants, a number of funding
variation scenarios may eventuate depending on the level and type of department funding remaining. This will be
reflected in where and whether the variation is processed within your service agreement/s.
A decision tree indicating the scenarios and the resultant withdrawal method is shown in below.
Information sheet on funding withdrawals during financial year-end and rollover processes
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Disability Services: funding withdrawal scenarios
* Notes:
Funding withdrawals relating to clients who transition to the NDIS up to 30 June 2017 will be processed in August
2017 as Prior Year Adjustments.
Overall the amount of funding received by service providers from the department will comprise negative funding
variations processed against NDIS impacted activities, offset by positive funding in other activities.
HACC-PYP funding will follow this procedure at the end of the in-kind arrangement.
Information sheet on funding withdrawals during financial year-end and rollover processes
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Examples of funding withdrawal across service agreements
The following tables provide examples of the method of funding withdrawal as clients transition and funding is
reduced.
Table 3: Sufficient funding remaining in FY against activity
Required variation: Withdraw $30,000 from Community Respite
Service
Agreement
FY funding remaining before
variation ($)
Service Plan
Activity
Activity
Disability
Services
Disability
Services
DHHS
NGO
Homelessness
Accommodation
FY funding remaining after
variation ($)
Community
Respite
50,000
Therapy
60,000
Transitional
Support
Service
Agreement
Provider
Activity
Service
Agreement
20,000
110,000
100,000
Provider
80,000
210,000
100,000
60,000
180,000
100,000
100,000
Table 4: Insufficient funding remaining in FY against activity, sufficient funding remaining in FY against
disability service agreement
Required variation: Withdraw $30,000 from Community Respite
Service
Agreement
FY funding remaining before
variation ($)
Service Plan
Activity
Activity
Disability
Services
Disability
Services
DHHS
NGO
Homelessness
Accommodation
FY funding remaining after
variation ($)
Community
Respite
20,000
Therapy
60,000
Transitional
Support
Service
Agreement
Provider
Activity
Service
Agreement
-10,000
80,000
100,000
Provider
50,000
180,000
100,000
Information sheet on funding withdrawals during financial year-end and rollover processes
60,000
150,000
100,000
100,000
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Table 5: Insufficient funding remaining in FY against activity, insufficient funding remaining in FY against
disability service agreement, sufficient funding remaining in FY against non-disability service agreement
Required variation: Withdraw $30,000 from Community Respite
Service
Agreement
FY funding remaining before
variation ($)
Service Plan
Activity
Activity
Disability
Services
DHHS
NGO
Disability
Services
FY funding remaining after
variation ($)
Community
Respite
5,000
Therapy
5,000
Homelessness
Accommodation
Transitional
Support
NDIS Transition
Recoupment
NDIS
Disability
Services
funding
recoupment
(17159)
Service
Agreement
Provider
Activity
Service
Agreement
-5,000
10,000
100,000
Provider
0
5,000
100,000
100,000
110,000
80,000
-20,000
80,000
Table 6: Insufficient funding remaining in FY against activity, insufficient funding remaining in FY against
disability service agreement, in sufficient funding remaining in FY against non-disability service
agreement, invoice required
Required variation: Withdraw $30,000 from Community Respite
Service
Agreement
FY funding remaining before
variation ($)
Service Plan
Activity
Activity
Disability
Services
DHHS
NGO
Disability
Services
FY funding remaining after
variation ($)
Community
Respite
5,000
Therapy
5,000
Homelessness
Accommodation
Transitional
Support
NDIS Transition
Recoupment*
NDIS
Disability
Services
funding
recoupment
(17159)*
Service
Agreement
Provider
Activity
Service
Agreement
-5,000
10,000
10,000
Provider
0
5,000
10,000
10,000
20,000
0
-10,000
0
Invoice raised for recoupment of $10,000 from service provider
* The NDIS service plan and activity have been created to ensure a negative adjustment to a non-disability service
agreement is clearly shown as being the result of a withdrawal of disability funding
Information sheet on funding withdrawals during financial year-end and rollover processes
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Authorised and published by the Victorian Government, 1 Treasury Place, Melbourne.
© State of Victoria, Department of Health and Human Services April, 2017.
Available at http://www.dhs.vic.gov.au/for-service-providers/disability/national-disability-insurance-scheme
Information sheet on funding withdrawals during financial year-end and rollover processes
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