File photo. Whaikaha chief executive Paula Tesoriero said the new ministry did not have the resources other ministries had, and was also dealing with an increase in demand. Photo: RNZ / Samuel Rillstone
Whaikaha, the Ministry of Disabled People, has fronted up to MPs about some of the challenges that saw it stripped of responsibility for support services.
The ministry was set up in 2022 as an agency within the Ministry of Social Development (MSD), but changes to support service and equipment funding in March labelled "callous" by Labour led to an outcry from disabled communities. Penny Simmonds - the minister at the time - acknowledged Whaikaha's communication of the changes was inadequate.
She was stripped of the portfolio in April, with Louise Upston taking up the role and ordering a rapid review which delivered a damning appraisal of spending controls. Upston then transferred responsibility for providing disability support services to MSD, leaving Whaikaha with responsibility for policy, monitoring and advocacy.
Speaking at the Social Services select committee on Wednesday during scrutiny week, Whaikaha chief executive Paula Tesoriero said as a new ministry still being set up - and as an extension of MSD - they did not have the resources and financial capability that other ministries had.
Part of the problem was disability funding had always been apportioned based on forecast demand, but was also capped. And unlike the previous provider - the Ministry of Health - Whaikaha was also unable to draw on funding from a sector-wide budget, Tesoriero said.
She said the government provided $18 million to ensure those with the highest needs received what they required, but the ministry was unable to communicate and consult on some things because it was subject to a confidential Budget bid process.
They were also dealing with an increase in demand for disability support services of about 4600 last year.
"That was more than the roughly 3400 the year before, and that was more than the year before that," deputy chief executive Ben O'Meara told the committee. The increase, he said, was partly due to New Zealand's ageing population, a wider acknowledgement of disability increasing people's awareness of their eligibility, and flexible funding - particularly changes introduced during the Covid-19 response - driving more people to seek support.
Whaikaha had also begun work on improving forecasting for demand - previously a simple assessment based on the trajectory from the year before - to take into account some of those factors. That work has now been passed on to MSD.
"What is needed is a much richer level of sophistication so that we can model changes in population, we can look at the different cohorts of the population from the previous year and see where the growth of those cohorts are likely to be."
Another issue was Whaikaha was at times being asked to fund things - like speech language therapists, school transport and medicines - which other agencies and ministries typically had provided.
In short, Whaikaha had been quickly running out of money. Tesoriero said they were facing an "unprecedented deficit of between $50m and $65m, and so some action had to be taken".
She said she had apologised to disabled communities for the way the funding problem was handled, "and it is absolutely my commitment that that will not happen again".
Labour's Carmel Sepuloni challenged Tesoriero about whether she had advised the minister to include a disabled person on the minister's urgent review panel. She said she would have to "go back and check".
Whaikaha was also working on preparing the groundwork for rolling out the Enabling Good Lives approach to funding services. She said Upston had been clear the government would continue to support the EGL principles, but she noted that was different to the EGL system approach developed through three trials.
A portion of the $73m allocated under Labour for rolling out the EGL approach had been drawn down in preparation for the rollout, she said, but the remainder had been transferred to MSD. The EGL rollout remains on pause after the review.
"Future decisions about transformation will be made by the government in due course," she said. "The funding that has been transferred to MSD will in large part go to helping to stabilise some of the issues in the current system that I touched on".
She said whether it would be used for disability support services generally or the Enabling Good Lives rollout would be a question for MSD.
