Social Services Minister Scott Morrison says it would be foolish to argue further cuts are not needed to the welfare system to pay for policies like the National Disability Insurance Scheme (NDIS).

Labor insists the NDIS is "fully funded" into the future through the Medicare levy increase and savings, like means testing the private health insurance rebate.

Mr Morrison said further savings were needed to ensure the system was sustainable into the future.

"We all want to see something like the NDIS," he said.

"We all want to see that and we all want to see this system be secure and sustainable for the people who will rely on it for generations. Now, to do that, we have to make some changes.

"To think you just can't make any changes and all of this will be possible I think is quite foolish."

Mr Morrison said the Commonwealth's share of funding the scheme will be $10 billion per year.

"We're not currently paying for that ... but we need to be able to ensure that the system can support that in the way it needs to be supported," he said.

"The welfare reforms that we will continue to work through. That is the prize – to be able to have something as world-standard as an NDIS."

Advocates concerned about future of NDIS after cuts

Mr Morrison has made it clear he will not reverse cuts to a range of social services grants, which disability advocates warned could affect the roll-out of the NDIS.

Disability Advocacy Network Australia chief executive Mary Mallett said the network, which represents advocacy groups, was concerned about what the cuts could mean for the NDIS as it is rolled out over the next few years.

The national body is set to lose its funding of $165,000 per year in February.

"We can see the Government is trying to make savings, but what we see from our perspective is that it's false economy to cut back on the voices that get through to the Government," Ms Mallett said.

"To dismantle and take away the representatives of people with a disability and their advocates at the same time just makes no sense.

"Now if the Government isn't hearing those voices and not having it represented to them properly then they're not taking those into account at the time they make policy decisions, so it's the reason why national bodies exist, and why there's always been a place for them.

"But the current Government appears to think differently."

The decision to cut $240 million from a range of homelessness, housing and disability grants dates back to the federal budget in May, when groups which receive Government funding were told they would have to apply for a smaller pool of money.