NDIS funding explained: Core, Capacity Building and Capital

What each budget covers, how flexible it is, and how support categories and items work.

If you have just received an NDIS plan, the funding can look confusing at first. Most of that confusion clears up once you understand that your plan is split into three separate budgets, each with its own rules about what it can pay for and how flexibly it can be spent.

This guide explains the three budgets in plain English: Core Supports, Capacity Building and Capital. Knowing which budget a support comes from helps you plan ahead, make your funding last, and avoid running out in the areas that matter most.

In this guide

The three budgets at a glance

An NDIS plan does not hand you one pool of money to spend on anything. Instead your funding sits inside three budgets, and each one has a different job. Core Supports pays for everyday assistance and consumables. Capacity Building pays for supports that build your skills and independence over time. Capital pays for higher-cost, one-off items such as equipment and home modifications.

The reason this structure matters is that money usually cannot move freely between the three budgets. You generally cannot take funding set aside for a wheelchair and spend it on cleaning, or take therapy funding and use it for a taxi. Understanding the boundaries helps you use each budget for what it was intended and avoid nasty surprises partway through your plan.

Underneath the three budgets, your funding is broken down further into support categories, and within those categories are individual support items. As you move from Core to Capacity Building to Capital, the funding generally becomes less flexible and more tied to a specific purpose. Knowing where a support sits tells you how freely you can use it.

Core Supports

Core Supports is the budget most participants use day to day, and it is usually the most flexible part of a plan. It covers the ordinary help that gets you through the week: assistance with daily living such as personal care and help around the home, consumables like continence products or low-cost aids, social and community participation, and transport where it is included.

In many plans, funding within Core can be moved reasonably freely between its categories. That means if you use less help at home one month, you may be able to put more toward getting out into the community, as long as the supports are reasonable and necessary and fit what your plan allows. This flexibility is one of the reasons Core is often the workhorse of a plan.

Transport funding, where it appears, helps with the cost of getting to activities and appointments when you cannot use public transport because of your disability. Because Core is flexible, it pays to keep an eye on how quickly you are spending it, so the everyday supports you rely on last the full length of your plan.

Capacity Building

Capacity Building funding is about growth. Rather than maintaining your current situation, it pays for supports that help you build skills, confidence and independence so that, over time, you may rely on less paid support. This includes therapies, support coordination, help finding and keeping a job, and supports that build your independence in daily life.

The key difference from Core is that Capacity Building is funded by category, and the money generally has to be used within the category it was given for. For example, funding placed in Improved Daily Living is meant for that purpose and usually cannot be redirected to a different Capacity Building category. This is because each amount is tied to a specific goal in your plan.

When your plan is built, the funding in each Capacity Building category is linked to the goals you talked about, such as improving your health, learning new skills or moving toward work. Because the money is less flexible than Core, it is worth planning how you will use each category across the plan so you get the most benefit from the supports that help you progress.

Capital

The Capital budget covers higher-cost, one-off items rather than ongoing services. The two main things it pays for are assistive technology, meaning equipment that helps you do things you otherwise could not, and home or vehicle modifications. Examples of assistive technology include wheelchairs, communication devices and specialised equipment.

Capital funding is usually the least flexible of the three budgets. It is generally quoted and stated to a specific purpose, which means the amount is set aside for a particular item and often needs a quote or an assessment before it can be spent. You typically cannot use Capital funding for anything other than the item it was approved for.

Because these items are expensive and specific, the NDIS often asks for supporting evidence, such as an assessment from an allied health professional, to confirm the item is the right one for you and is reasonable and necessary. Once approved, the funding waits in your plan until the item is quoted and purchased, so there is no rush to spend it the way there can be with everyday supports.

Categories, items and price limits

Inside each of the three budgets sit support categories, and inside each category sit individual support items. Think of it as a set of nested layers: the budget is the broad pool, the category groups similar supports together, and the item is the specific service or product a provider claims against.

Many supports have a price limit, set out in the NDIS Pricing Arrangements and Price Limits, which is published on ndis.gov.au and updated from time to time. A price limit is the most a provider can charge for that item. Providers can charge less, but not more, and the limit helps make sure funding is spent fairly and stretches as far as it should.

Because price limits change and vary by support, it is worth checking the current Pricing Arrangements rather than relying on old figures. If you use a plan manager or support coordinator, they can help you understand which items your providers are claiming against and whether the charges sit within the published limits.

Flexible vs stated funding

One of the most useful distinctions to understand is flexible versus stated funding. Flexible funding can be used across the support items within its category or budget, giving you room to adjust as your needs change. Stated funding is locked to a particular purpose and can only be used for that specific support.

Core Supports is often largely flexible, which is why it suits everyday needs that shift week to week. Capital is almost always stated, because it is set aside for a named item. Capacity Building sits in between: it is generally used within its category, and some amounts may be stated to a specific support named in your plan.

If part of your plan is stated, your plan documents will make that clear. When you are unsure whether an amount is flexible or stated, check your plan in the my NDIS portal or ask your plan manager or support coordinator. Getting this right means you spend confidently and keep the supports you depend on funded for the whole plan.

Frequently asked questions

What are the three NDIS budgets?
The three budgets are Core Supports, Capacity Building and Capital. Core covers everyday assistance and consumables. Capacity Building funds supports that build your skills and independence, such as therapy and support coordination. Capital covers higher-cost one-off items like assistive technology and home modifications. Each budget has its own rules about how flexibly the money can be spent.
Can I move funding between the three budgets?
Generally no. Money usually cannot move freely between Core, Capacity Building and Capital. For example, you cannot take funding set aside for equipment and spend it on daily assistance. Within a budget there may be some flexibility, particularly in Core Supports, but the boundaries between the three budgets are firm. Check your plan or ask your plan manager if you are unsure.
Why is Core Supports the most flexible budget?
Core Supports is designed for everyday needs that change from week to week, so in many plans the funding can be moved reasonably freely between its categories. This lets you adjust between things like help at home and getting out into the community. The supports still need to be reasonable and necessary and fit what your plan allows, but Core gives you the most day-to-day room to move.
Why can't I spend Capacity Building funding wherever I like?
Capacity Building is funded by category, and each amount is tied to a specific goal in your plan. Funding placed in a category such as Improved Daily Living is meant for that purpose and generally cannot be redirected to another Capacity Building category. This keeps the money linked to the goals you discussed when your plan was built, such as improving skills or moving toward work.
What does the Capital budget pay for?
Capital pays for higher-cost, one-off items rather than ongoing services. The two main things it covers are assistive technology, meaning equipment that helps you do things you otherwise could not, and home or vehicle modifications. Examples include wheelchairs and communication devices. Capital funding is usually quoted and stated to a specific purpose, so it can only be spent on the item it was approved for.
What is a price limit?
A price limit is the most a provider can charge for a particular support item. Limits are set out in the NDIS Pricing Arrangements and Price Limits, published on ndis.gov.au and updated from time to time. Providers can charge less than the limit but not more. Checking the current Pricing Arrangements helps you understand whether the charges on your plan sit within the published limits.
What is the difference between flexible and stated funding?
Flexible funding can be used across the support items within its category or budget, giving you room to adjust as needs change. Stated funding is locked to a particular purpose and can only be used for that specific support. Core Supports is often largely flexible, Capital is almost always stated, and Capacity Building sits in between, generally used within its own category.
What does reasonable and necessary mean?
Reasonable and necessary is the test the NDIS uses to decide what supports it will fund. In broad terms, a support must relate to your disability, represent value for money, be likely to help you, and be a support the NDIS should fund rather than another service system or your family. All funding in your plan, across every budget, must meet this test. Full details are on ndis.gov.au.

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