The Australian Competition and Consumer Commission (ACCC) is cracking down on businesses making false or misleading claims to NDIS participants.
The ACCC has joined forces with the National Disability Insurance Agency (NDIA) and the NDIS Quality and Safeguards Commission to identify and address advertising practices that may be in breach of the Australian Consumer Law.
“Businesses must not make false representations regarding access to the NDIS, and consumers must be able to rely on statements being made by NDIS providers as being true and accurate,” ACCC Deputy Chair Catriona Lowe said.
What’s the Issue?
The ACCC is concerned that many businesses are misleading NDIS participants by:
- Falsely claiming NDIS approval: Suggesting that certain products or services are “NDIS approved” or “NDIS funded” when this is not the case.
- Misrepresenting funding eligibility: Advertising goods or services that are not eligible for NDIS funding, such as general holiday expenses or food.
- Providing misleading advice on NDIS funding: Offering advice on how to use NDIS funding codes for ineligible expenses.
- Misleading consumers about business affiliations: Implying affiliation or endorsement by the NDIS, for example, by using “NDIS” in the business name or service description.
Why is this a problem?
These misleading practices can lead to significant financial hardship for NDIS participants. When individuals are induced to purchase goods or services that are not claimable under their NDIS plan, they may be left with substantial personal debt.
What are the Rules?
The NDIS does not publish specific advertising rules or guidelines nor is there a law that stipulates how NDIS services can be advertised. Rather the NDIA relies on the ACCC enforcing the Australian Consumer Law (ACL) to ensure fairness and accuracy in advertising.
The ACL offers a wide range of protections for consumers, including those participating in the NDIS. Businesses operating within Australia must adhere to these standards, particularly when dealing with vulnerable consumers.
Key obligations under the ACL include:
- Honest and Transparent Practices: Businesses must not mislead or deceive consumers by providing false or incomplete information.
- Fair Contractual Terms: Contracts must be clear, fair, and not contain unfair terms.
- Acceptable Quality and Fitness for Purpose: Goods and services must be of acceptable quality, fit for their intended purpose, and match any description or sample provided.
- Consumer Guarantees: If goods or services fail to meet these standards, consumers are entitled to remedies such as repair, replacement, or refund.
- Cooling-Off Period: For unsolicited consumer agreements, such as those made door-to-door or via telemarketing, consumers have a 10-day cooling-off period to cancel the contract.
- Proof of Purchase: Businesses must provide proof of purchase upon request.
By understanding and adhering to these consumer protections, businesses can ensure fair dealings with NDIS participants and avoid potential legal consequences.
ACCC Takes Action
The ACCC is actively investigating multiple NDIS providers and anticipates taking public enforcement action in the near future. The ACCC have announced that for 2025 this is an active compliance priority.
What Can NDIS Participants Do?
If you believe a business has made false or misleading statements about products or services, or if you feel your consumer rights have been violated, you can report it to the ACCC here.
For more information, visit the ACCC website.
By taking a firm stance against misleading advertising, the ACCC aims to protect the rights of NDIS participants and ensure fair market practices.
