THE federal Coalition says it will find the $8 billion-a-year extra needed to fund the National Disability Insurance Scheme by slashing spending, while Labor says it wants the states to contribute.
After the federal government fought last week to secure state co-operation to help fund trials of the scheme starting next year, attention is now turning to how the scheme will be funded when it is fully operational by 2018.
However, the government is in no rush to settle the dispute, despite the states, led by NSW, demanding certainty about the final funding arrangements before the trials begin.
The Disability Reform Minister, Jenny Macklin, said yesterday legislation for the NDIS would be introduced into Parliament ''as soon as possible'' but it wouldn't include details on funding.
''This is legislation that will establish the scheme. We will continue to talk with the states and territories about the shared funding commitment,'' she said.
Any attempt to extract extra money from the states will meet fierce resistance and will also contravene the preferred model proposed by the scheme's designer, the Productivity Commission.
The scheme will cost an estimated $15 billion a year by 2018, about $8 billion more than the states and territories combined spend now on disability services.
The Productivity Commission recommends the Commonwealth be sole funder and administrator of the scheme to prevent duplication and blame game politics.
It says the Commonwealth could keep the $4.7 billion a year it gives the states for disability funding and then find the extra $8 billion from general revenue.
''The amount needed could be funded through a combination of cuts in existing lower-priority expenditure, fiscal drag and, if necessary, tax increases,'' it says.
It describes a pooled funding model between the Commonwealth and states as less preferred and weaker.
The opposition finance spokesman, Andrew Robb, said the Coalition would follow the Productivity Commission recommendations. He said the extra money would most likely be found through cuts.
''We will introduce that program according to the Productivity Commission proposal, which means we will allocate resources to this project to be able to start in full by 2018,'' he said. ''It probably would require the removal or scaling back of other programs.''
Mr Robb's comments are in contrast to those of the shadow treasurer, Joe Hockey, who is striving to fund existing Coalition promises and has repeatedly cautioned whether the Coalition could afford the scheme.
Mr Hockey supports the NDIS but has said it would be cruel to offer hope to the disabled when there was no guarantee the money could be found.
Ms Macklin told Channel Ten's Meet the Press program that disability services were now jointly funded by the states and the Commonwealth and that should continue. ''We do think it's a shared responsibility,'' she said.
All states have made it clear they will not contribute to the final scheme, beyond the $4.7 billion they will hand back.
On Friday, NSW bowed to pressure and offered $35 million to help fund a trial in the Hunter. It was half the $70 million being demanded. Officials will meet in Sydney today to discuss details.