“What responsibility should we have over how welfare is delivered to those in need? Since the introduction of federal unemployment benefits in 1944, the government has provided welfare in cash. The reason is expedience: dropping cash into an account is simpler and cheaper than the traditional church welfare of providing clothes, food or vouchers.
But what happens if the cash is wasted on drugs, alcohol and gambling, leading to catastrophic social consequences?
Our view is the debit card could reduce the social harm welfare-fuelled abuse can cause, while still providing as much individual freedom as possible to welfare recipients.
The government believes this concept is worth trialling and today I will be introducing legislation to implement the idea in two or three regions.”
Federal Parliamentary Secretary to the Prime Minister The Hon. Alan Tudge MP (above right)
Wednesday, 19 August 2015 Opinion
DOWNLOAD and read full transcript of Alan Tudge Interview in Ceduna
SEE ALSO PREVIOUS NACCHO REPORT : More communities support Healthy Welfare Card
This is the question the Abbott government has been grappling with following the recommendation in Andrew Forrest’s Creating Parity report to introduce a cashless debit card for welfare recipients in vulnerable areas.
The logic is inescapable. We have places where welfare is a major part of the local economy and the welfare dollar is fuelling gambling, alcohol and drug abuse.
It’s not just that individuals are wasting welfare payments but welfare abuse is destroying the lives of women and children.
In a place such as Kununurra, the hospitalisation rate from assaults is 68 times the national average. Across the Northern Territory, indigenous women are being bashed every year at a rate of 11 assaults per 100 women. These are just the reported cases. Two-thirds are related to alcohol, nearly all of which is paid for by welfare cash. It is not uncommon for kids to go hungry because there is no food on the table. Not because of poverty — an unemployed couple with three young children could have $800 in welfare cash a week after housing costs — but because the money is wasted in the first few days after “payday”. The National Crime Commission says towns of high welfare dependence are being targeted by criminals selling ice.
Most of the measures taken in the face of such evidence have been on the supply side, tough rules about what can be sold at pubs and what can be imported into a community. Such restrictions typically have halved the rate of violence in those places. But even in remote communities it’s hard to sustain initial gains and stop the grog runners and drug dealers. In urban areas, restricting supply (other than through hours of sale) is nearly impossible.
Forrest’s proposal is to work on the demand side. He argues that in certain areas, all welfare payments — except old age and veterans’ pensions — be placed on an ordinary bank debit card that could be used anywhere to purchase anything, but simply cannot be used at liquor stores or gambling venues. Because cash would be limited, illicit drugs could not be bought.
The government believes this concept is worth trialling and today I will be introducing legislation to implement the idea in two or three regions. These regions will be chosen on the basis of (a) high welfare dependence and social harm caused by welfare-fuelled alcohol and drug abuse, and (b) willingness of community leaders to participate in the trial. The Ceduna region will be the first trial site and we are in discussions with East Kimberley leaders about that region being the second. Our view is the debit card could reduce the social harm welfare-fuelled abuse can cause, while still providing as much individual freedom as possible to welfare recipients.
We have been negotiating with banks and community leaders over how the card could be designed and implemented. How a card would be issued, how online transactions would occur, how people could get account balances and how fees would be structured to minimise or eliminate costs to the user are issues being worked through. The intent is for the card to look as much as possible like the ordinary debit card most people carry in their pocket daily. Eighty per cent of payments will be placed on the card, with the other 20 per cent continuing to go into the recipient’s bank account.
Where there is a desire to do so, we will implement a local board that will have control over the settings of the card. This board would have power to lift the amount of welfare placed into an individual’s cash account. Key additional services such as alcohol counselling and financial management assistance may need to be introduced.
This proposal is not income management. There will be no compulsion for anyone to spend their payments in a particular way, although of course people will be encouraged to establish a budget. There will be complete freedom, with the exception of two restricted products.
I acknowledge that for some people, using a card rather than cash to pay for everyday items will be an initial inconvenience. The potential upside, however, is a transformed community where women are safer and more money is available for children’s needs. If successful, this will represent a radical new positive approach to the distribution of welfare.
We talk about Aboriginal ppl here but should this be a standardised graduated way for ALL Australians on welfare including Senior pensioners? eg: Your centrelink health care card as one bank linked card based welfare payment system for all welfare recipients and no gross discrimination based on race or where you happen to live but case by case selective limitations based on individual circumstances.
Why when we face a complex problem do we simply look for the most basic control and not the slightly more complex system of Enablement. Education, training, mentoring, treatment……I believe because we are copping out and these systems and processes are in our society so un-coordinated, disjointed and ineffective because we are simply looking for the magic bullet.
I have experienced tired and dejected (going through the motions) Drug and Alcohol workers, police , child protection and court workers in these regions say “but they have to want to change” and that is correct but if we do not enable that it will not happen. I would rather see all drug / alcohol and health care workers trying to do proactive education and doing themselves out of jobs rather than building careers reliant upon the issue and reacting. A change of mind set.
Easily said but how to implement and ensure fairness and effectiveness?
A total package to enable people rather than simply take away their rights and choices without good reason.
The answer clearly must be in education and also monitoring for those cases that come to the attention of the courts, the law, Child protection and schools and under any existing mandatory reporting laws.
Do we enable Welfare recipients ?
– Do we run Age Pensioners through any education on adjusting to aging and managing finances?
– Do we run unemployed people through education of now living on welfare while how to actively seek jobs and or re skill.
– Do we run Disability support pensioners through Education programs on what supports, services and things they might do to live on welfare and may be improve their lives …even be off Welfare?
– Do we have education programs for people who clearly have issues with drugs/Alcohol, Gambling, poor school attendance if that is the case, Pensioners who are struggling with basic costs of living circumstances.
In general there are programs but No we do not really in my experiences….we simply ensure they meet criteria and do checks on Unemployed at regular intervals.
There are a multitude of disconnected and varied programs but not a coordinated standard uniform basic set for people going on Welfare or on long term welfare. Budgetting, support services, keeping active, depression and what can do, abuse and resources available, etc….
I call it welfare for living…..not welfare for life.
Getting that Centrelink health care card should be a touch point for Education and learning to deliver best effect (human outcome) for money spent.
We all use eftpos and credit cards and this should be
no different. A debit card against a specific bank account account linked to centrelink. If people have other bank accounts that is ok and
In addition for those not on centrelink but wish to exercise controls on their own spending it could be a service offered for all bank cards where individual card holders can themselves go online and place limits on where and how much the card can be used and for what types of items. We can set up EFTPOS transfers and such but not make our own restrictions.
I have a struggle with state controlled welfare cards based on race or place of residence and a BIG struggle with the “set and forget” rules based Centelink welfare system we have that is not based principally on Educating for living and minimizing welfare dependence.
As a tax payer and stakeholder I want to see welfare adding value to our society and economy in ways that improves peoples lives (reduces disadvantage) when they need it most an educating for better living in a healthier society. That is how I want my contribution to be spent. Not being police and nanny watchers ….but enablers.
I know it is complex and many good things happening but have we lost sight of why in 1944 we started this system and are band aiding.