The federal government has reached an agreement with states and territories on a contentious reform to the NDIS.

The Senate is deliberating on National Disability Insurance Scheme reform to cap funding to the NDIS at eight per cent per year, but state and territory governments had raised concerns they had been left out of the process.

However, a representative body for states and territories has agreed to a series of amendments to the bill that will enhance co-governance between federal and state governments.

The agreed-upon changes will introduce faster time-frames for approving changes to NDIS rules and a new dispute resolution approach that will escalate issues to states.

It will also change the requirements for approvals to rules for the scheme, moving to majority – rather than unanimous – support from state ministers.

“For people with disability in their families, it all works better when you don’t have the feds and the states arguing,” NDIS minister Bill Shorten told reporters in Canberra on Wednesday.

“These changes will also ensure scheme sustainability that is protected in the short-to-medium term.”