“Income management proponents say it can stabilise recipients’ lives and finances, and our study found some people have experienced these benefits.
However many more people have faced additional financial challenges because of the policies.
Many also found their expenses had increased as they were blocked from participating in the cash economy and burdened with new fees and charges.
There have been recent moves to extend the Cashless Debit Card across the Northern Territory, but our findings show that CIM has in fact weakened many participants’ financial capabilities and autonomy.
To manage their finances, many participants have become reliant on family members, service providers or automatic payment systems.”
The University of Queensland’s Professor Greg Marston said the majority of participants using the Basics Card or Cashless Debit Card reported practical difficulties making purchases and paying bills, which introduced new instability into their lives
“Our research illustrates that the empirical case for continuing with the current policy settings on [compulsory income management] is weak,” the study said. “Our research is certainly not the first to suggest these set of policy measures require a fundamental rethink.”
The Morrison government wants to impose the cashless debit card on 23,000 Territorians with no evidence it works.
We’ve had compulsory income management with the Basics Card in the NT for 13 years. “
“It is untenable for the Government to continue the so-called cashless debit card trial sites in Ceduna, the East Kimberley, Goldfields and Hinkler region and to extend it to the NT.
Income management has been a racist discriminatory tool imposed on First Nations peoples for over a decade, since the NT Intervention.
The Government is trying to entrench this card by stealth through legislation that extends the card, year by year without proper evaluation.
It is appalling that the Government is hinting at a national rollout as people are suffering right now on this card.
This study reflects what was found by the final evaluation of the NT intervention, that income management met none of its objectives, as well as the ANAO report which found that there was no evidence that there had been a reduction in social harm in the so-called trial sites. “
Restricting where and on what social security payments can be spent does more harm than good, according to the first large, independent study into Compulsory Income Management (CIM) policies in Australia.
The study team said CIM had often been framed as an intervention to strengthen benefit recipients’ independence, build responsibility and help transition people away from “welfare dependency” and into work.
Professor Marston said previous evaluations had raised significant concerns about the capacity of income management policies to meet their stated objectives, yet income management continued to be expanded.
Researcher Dr Michelle Peterie said the study was unique for its focus on individuals’ and communities’ experiences with the Cashless Debit Card and BasicsCard.
“These voices have frequently been lost or ignored in the policy debate,” she said.
Dr Peterie said the research showed a voluntary, opt-in form of income management could have a place, however the social, emotional and economic costs of continuing with a compulsory, widespread system outweighed the benefits.
“The overwhelming finding is that compulsory income management is having a disabling rather than enabling affect on the lives of many social security recipients,” Dr Peterie said.
“This was true across all of our research sites.”
Professor Marston said a policy approach that focused on providing employment and training opportunities and ensuring accessible social services and affordable housing would be a better starting point for creating healthy, economically secure and socially inclusive communities.
The research involved 114 in-depth interviews, conducted at four trial sites (Playford, Shepparton, Ceduna and Hinkler), and a mixed-methods survey of 199 people at income management sites across Australia.
” NACCHO is strongly opposed to the current cashless debit card trials as well as any proposal to expand. We also note that Aboriginal people are disproportionately affected by the trials and that they are in and proposed for locations where the majority participants are Aboriginal. Whilst it is not the stated intent of the trials, its impact is discriminatory.
NACCHO knows that some Aboriginal people and communities need additional support to better manage their lives and ensure that income support funds are used more effectively.
However, NACCHO is firmly of the view that there are significantly better, more cost efficient, alternative approaches that support improvements in Aboriginal wellbeing and positive decision making.
Aboriginal Community Controlled Health Services would be well placed to develop and implement alternative programs. We firmly believe that addressing the ill health of Aboriginal people, including the impacts of alcohol, drug and gambling related harm, can only be achieved by local Aboriginal people controlling health care delivery.
We know that when Aboriginal and Torres Strait Islander people have a genuine say over our lives, the issues that impact on us and can develop our own responses, there is a corresponding improvement in wellbeing. This point is particularly relevant given that the majority of trial participants are Aboriginal. “
Selected extracts from Submission to the Senate Community Affairs Legislation Committee Inquiry into the Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018
Part 1 Submission to the Senate Community Affairs Legislation Committee Inquiry into the Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018
On 21 June 2018, the Senate referred the Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018 to the Senate Community Affairs Legislation Committee for inquiry and report.
Submissions were sought by 20 July 2018. The reporting date is 14 August 2018.
Committee Secretariat contact:
Committee Secretary
Senate Standing Committees on Community Affairs
PO Box 6100
Parliament House
Canberra ACT 2600
The following submission to the Senate Community Affairs Legislation Committee is made by the National Aboriginal Community Controlled Health Organisation (NACCHO). NACCHO is the national peak body representing 143 Aboriginal Community Controlled Health Organisations (ACCHOs) across the country on Aboriginal health and wellbeing issues.
An ACCHO is a primary health care service initiated and operated by the local Aboriginal community to deliver holistic, comprehensive, and culturally appropriate health care to the community which controls it, through a locally elected Board of Governance.
They range from large multi-functional services employing several medical practitioners and providing a wide range of services, to small services which rely on Aboriginal Health Workers and/or nurses to provide the bulk of primary care services, often with a preventive, health education focus. The services form a network, but each is autonomous and independent both of one another and of government.
NACCHO and its members are a living embodiment of the aspirations of Aboriginal communities and their struggle for self-determination. In 1997, the Federal Government funded NACCHO to establish a Secretariat in Canberra which greatly increased the capacity of Aboriginal Peoples involved in ACCHOs to participate in national health policy development.
The integrated primary health care model adopted by ACCHOs is in keeping with the philosophy of Aboriginal community control and the holistic view of health. Addressing the ill health of Aboriginal people can only be achieved by local Aboriginal people controlling health care delivery. Local Aboriginal community control in health is essential to the definition of Aboriginal holistic health and allows Aboriginal communities to determine their own affairs, protocols and procedures.
NACCHO understands that the Bill seeks to amend the Social Security (Administration) Act 1999 to: expand the cashless debit card arrangements to a further trial site, the Bundaberg and Hervey Bay area, to run until 30 June 2020; specify the class of trial participants for the area and increase the total number of trial participants overall to 15 000; provide for an exception from the restrictive trade practices provisions of the Competition and Consumer Act 2010 for merchants that implement product level blocking systems to identify that a cashless debit card is being used for payment and, if any restricted products are being purchased, decline the transaction; and limit the use of the restricted portion of a payment to prevent the portion being used to obtain cash-like products which could be used to obtain alcohol or gambling.
NACCHO is strongly opposed to the current cashless debit card trials as well as any proposal to expand. We also note that Aboriginal people are disproportionately affected by the trials and that they are in and proposed for locations where the majority participants are Aboriginal. Whilst it is not the stated intent of the trials, its impact is discriminatory.
To assist the Committee in assessing this submission, it has been structured against the following key issues: available evidence on current trials; cost benefit; evaluation; additional services and support; community control and ownership; and expansion.
Available evidence on current trials
NACCHO notes that the recent evaluation of the Cashless Debit Card Trials, notwithstanding the quality of the evaluation, found that:
Only 24 per cent of card users reported less alcohol consumption and drug use in their communities, and only 27 per cent of people noting a decrease in gambling.
The administration of the card has been confusing and the role of the community panel has not been well implemented: the rules of engaging with the panel and their role is not well understood.
Despite the small community improvements, many people remained unhappy with the welfare restrictions, with about half saying it had made their lives worse, and 46 per cent reporting they had problems with the card.
NACCHO believes that this is not a strong enough evidence base to warrant the expansion of the trials to other sites.
We also note that the majority of trial participants identify as Aboriginal in the evaluation and believe that this amounts to a discriminatory policy in its application.
Cost benefit
NACCHO notes that no cost benefit analysis has been undertaken, however we understand from Senate Estimates that the cost of delivering the Cashless Debit Card program is in excess of $12,000 per participant at the time the trial had been running for approximately 12 months.
NACCHO is strongly of the view that this funding could be more effectively spent on early intervention and primary health care strategies targeted towards reducing alcohol, drug and gambling related harm.
Notwithstanding our primary view that the trial funding should be redirected, a robust cost benefit analysis should be undertaken prior to any expansion of the trials and this should be made public. The recently released Australian National Audit Office (ANAO) report, The Implementation and Performance of the Cashless Debit Card Trial, concludes that “it is difficult to conclude… whether the card was a lower cost welfare quarantining approach”.
We also note that the notion that the trials will be more cost efficient the more participants are involved is not the basis of a cost benefit analysis and should not be used as a justification of any expansion.
Evaluation
NACCHO notes that there has been public criticism of the evaluation of the trials to date undertaken by ORIMA Research, including by the Australian National University. In particular, NACCHO notes that the evaluation did not include data from state governments relating to alcohol related crimes and alcohol related hospital admissions. This data is crucial to building a robust evaluation framework and assessing the trial impact for the current and any future sites.
We note that the ANAO Report also found that the “approach to the monitoring and evaluation of the trial was inadequate”. The ANAO report further found that there was a lack of robustness in the data collection and the evaluation did not make use of administrative data available to measure the impact of the trial.
The lack of robust evaluation framework and corresponding evidence means it is not possible to conclude that there has been a reduction in alcohol and drug related harm as a result of the trial. This view is also supported by the ANAO Report.
NACCHO also recommends that any evaluation should be considered alongside the effectiveness of other community driven and community controlled initiatives and programs to help tackle alcohol and drug related harm in particular communities.
Additional services and support
NACCHO notes that additional prevention and support services were announced as part of the current trials. We believe these services are critical to supporting communities tackle harm caused by alcohol, drugs and gambling. The cashless debit card has not been effective and should not be considered as a stand alone response to community harm and disadvantage.
We further understand that the proposed services in current sites have been slow to implement and, in many cases, would be insufficient to address community dysfunction. Any expansion of the trials should be coupled with a significant package of early intervention and prevention services.
Community control and ownership
NACCHO knows that some Aboriginal people and communities need additional support to better manage their lives and ensure that income support funds are used more effectively. However, NACCHO is firmly of the view that there are significantly better, more cost efficient, alternative approaches that support improvements in Aboriginal wellbeing and positive decision making.
Aboriginal Community Controlled Health Services would be well placed to develop and implement alternative programs. We firmly believe that addressing the ill health of Aboriginal people, including the impacts of alcohol, drug and gambling related harm, can only be achieved by local Aboriginal people controlling health care delivery. We know that when Aboriginal and Torres Strait Islander people have a genuine say over our lives, the issues that impact on us and can develop our own responses, there is a corresponding improvement in wellbeing. This point is particularly relevant given that the majority of trial participants are Aboriginal.
We note that the ANAO ReporProposed expansiont concludes that aspects of the current trial have informed the proposed wider roll out, but that the current trial was not designed to test the scalability and thus has not been evaluated with this in mind.
NACCHO is opposed to the further roll out and expansion of the cashless debit card trials. We believe there is: insufficient evidence of the current trials’ success; a lack of information about the cost of the trials and a cost benefit analysis; insufficient planning and consultations to help inform an expansion; insufficient additional supports and services in current trial sites and that is being funded for the proposed new locations; and that other community driven programs and initiatives should be explored in locations where there is entrenched social harm caused by alcohol, drugs and gambling.
Based on the evidence to date and the findings in the ANAO Report, we believe that the proposed expansion in this Bill is not justified.
“But what we had before the card, which is just open sort of slather of people buying heaps of alcohol with the money that they get, the amount of damage it was doing, I think that this is definitely an improvement on what we had previously,”
I would support the card being rolled out across the country.
Yes I do, I think this is a more responsible way of actually delivering support and social services to our people regardless of what colour they are,”
Ian Trust, the executive director of the Wunan Foundation, an Aboriginal development organisation in the East Kimberley in Western Australia, said his support for the card had come at a personal cost. SEE ABC ReportPhoto: A Kununurra resident in WA’s Kimberley holding a cashless welfare card. (ABC News: Erin Parke)
“Inevitably, people would prefer to have fewer restrictions than more restrictions, particularly if you are an alcoholic, but the evaluation and the data shows that it is having a positive net impact on reducing alcoholism, gambling and illicit substance abuse.
The rights of the community, of the children and of elderly citizens to live in a safe community are equally important as the rights of welfare recipients.”
Human Services Minister Alan Tudge said while the card was not a “panacea”, it had led to stark improvements in the trial communities, warranting an extension of the card, despite it not being popular with all welfare recipients. Reported by Sarah Martin in Todays Australian
A cashless welfare card that stops government benefits being spent on drugs and alcohol will be made permanent in two remote communities and looks set to be expanded, after trials found it greatly reduced rates of substance abuse and gambling.
The 175-page government commissioned review by Orima Research of the year-long trial.
The evaluation involved interviewing stakeholders, participants and their families.
It found on average a quarter of people using the card who drank said they were not drinking as often.
While just under a third of gamblers said they had curbed that habit.
The Turnbull government will today release the first major independent audit of the cashless welfare system and announce that the card will continue in Ceduna and East Kimberley, subject to six-monthly reviews.
Establishing a clear “proof of concept” in the two predominantly indigenous communities also paves the way for the Coalition to roll out the welfare spending restrictions further, with townships in regional Western Australia and South Australia believed to be under consideration.
In October, Malcolm Turnbull flagged that an expansion of the welfare card was dependent on the results of the 12-month trial, but praised the scheme’s initial success in reducing the amount of taxpayer money being spent on alcohol and illicit drugs.
Under the welfare shake-up, first flagged in Andrew Forrest’s review of the welfare system in 2014, 80 per cent of a person’s benefit is restricted to a Visa debit card that cannot be used for spending on alcohol or gambling products or converted to cash. After year-long trials at the two sites capturing $10 million in welfare payments, the first quantitative assessment of the scheme has found that 24 per cent of card users reported less alcohol consumption and drug use in their communities, with 27 per cent of people noting a drop in gambling.
Binge drinking and the frequency of alcohol consumption by card users was also down by about 25 per cent among those who said they were drinkers before the trials began.
Those not on welfare saw even greater benefits, with an average of 41 per cent of non-participant community members across the two trial sites reporting a reduction in the drinking of alcohol in their area since the trial started. The report concluded that, overall, the card “has been effective in reducing alcohol consumption, illegal drug use and gambling — establishing a clear ‘proof-of-concept’ and meeting the necessary preconditions for the planned medium-term outcomes in relation to reduced levels of harm related to these behaviours”.
However the audit, undertaken by ORIMA Research, found that despite the community improvements, many people remained unhappy with the welfare restrictions, with about half saying it had made their lives worse, and 46 per cent reporting they had problems with the card.
This view was reversed in the wider community, with 46 per cent of non-participants saying the trial had made life in their community better, and only 18 per cent reporting that it had made life worse.
Many of the reported problems with the card were attributed to user error or “imperfect knowledge and systems” among some merchants. Of the 32,237 declined transactions between April and September last year, 86.2 per cent were because of user error, with more than half found to be because account holders had insufficient funds.
While there was a large amount of anecdotal evidence in favour of the card, there were also reports of a rise in humbugging — where family members are harassed for money — and some reports of an increase in crime linked to the need for cash, including prostitution.
Human Services Minister Alan Tudge said while the card was not a “panacea”, it had led to stark improvements in the trial communities, warranting an extension of the card, despite it not being popular with all welfare recipients. However, he stressed that no decision had been made to expand the card to new sites, which would require legislation.
“Inevitably, people would prefer to have fewer restrictions than more restrictions, particularly if you are an alcoholic, but the evaluation and the data shows that it is having a positive net impact on reducing alcoholism, gambling and illicit substance abuse,” Mr Tudge said. “The rights of the community, of the children and of elderly citizens to live in a safe community are equally important as the rights of welfare recipients.”
The government has introduced the card only to regions where it has the support of community leaders, allowing the Coalition to secure the backing of Labor for the two trial sites despite opposition from the Greens and the Australian Council of Social Service.
Liberal MP Melissa Price, who represents the vast West Australian regional electorate of Durack, said yesterday she was hopeful the card could be rolled out across the Kimberley, the Pilbara and the Goldfields, estimating that about half of the 52 councils in her electorate had expressed an interest in signing up.
“I know it is not popular with everybody, but we are in government and we need to make these decisions to improve people’s lives; if we don’t make changes, nothing changes,” Ms Price said.
Cashless Debit Card Trial – Overview
The Commonwealth Government is looking at the best possible ways to provide support to people, families and communities in locations where high levels of welfare dependence exist alongside high levels of harm related to drug and alcohol abuse.
The Cashless Debit Card Trial is aimed at finding an effective tool for supporting disadvantaged communities to reduce the consumption and effects of drugs, alcohol and gambling that impact on the health and wellbeing of communities, families and children.
How the cashless debit card works
The cashless debit card looks and operates like a normal bank card, except it cannot be used to buy alcohol or gambling products, or to withdraw cash.
People on the Age Pension, a veteran’s payment or who earn a wage can volunteer to take part in the trial. Information on volunteering for the trial is available. Application forms for people who wish to volunteer can be downloaded from the Indue website (link is external).
How will it affect Centrelink payments?
The trial doesn’t change the amount of money a person receives from Centrelink. It only changes the way in which people receive and spend their fortnightly payments:
80 per cent is paid onto the cashless debit card
20 per cent is paid into a person’s regular bank account.
Cashless debit card calculator
To work out how much will be paid onto your cashless debit card, enter your fortnightly payment amount into the following calculator.
Enter amount of fortnightly Centrelink payment Calculate
“The cashless welfare card is unfair, a form of control and reminds Aboriginal people every day that they are treated as second- and third-class citizens in their own land,”
One of the key issues in many of the areas where the card operates, such as in remote areas of South Australia, is the difficulty of accessing fresh produce at reasonable prices.
Where is the evidence that this card increases this access and enables Aboriginal people to get the healthy food they need?
A person’s dignity can also be lost when having to use such a card which can also have detrimental impacts on both their mental and physical health and wellbeing.”
Pat Turner, the chief executive of NACCHO national peak body on Aboriginal health
The welfare card was “unfair” and “a form of control”, Turner said in response to a Guardian Australia report from the South Australian town of Ceduna which found welfare recipients on the card felt disempowered and dictated to.
But Turner, who before being appointed to the National Aboriginal Community Controlled Health Organisation (Naccho) was the longest-serving chief executive of the Aboriginal and Torres Strait Islander Commission and spent 18 months as Monash Chair of Australian Studies at Georgetown University in Washington, questioned the evidence from the government’s report
The trial of the card, known as the indue card, began in Ceduna in March and in the Western Australian towns of Kununurra and Wyndham in April. Welfare recipients in those towns now receive 80% of their welfare payments into the indue card, which cannot be used to withdraw cash or buy alcohol or gambling products. The remaining 20% can be withdrawn as cash.
The government, including the prime minister, Malcolm Turnbull, and the human services minister, Alan Tudge, say the card has so far been a success.
In a report released six months into the card’s trial, anecdotal evidence and early data found poker machine revenue in the Ceduna region between April and August last year was 15.1% lower than for the equivalent period in 2015.
There had also been a strong uptake of financial counselling, the report said, with 300 people seeking counselling since the trial began. Anecdotally, there had been a significant decline in people requesting basic supplies like milk and sugar from the Koonibba Community Shopfront in Ceduna, the report also said.
Most people on welfare in the trial towns are Aboriginal.
Guardian Australia has contacted the Department of Health and Human Services for comment.
The strength of data used in the government’s cashless welfare card progress report has been questioned by Aboriginal elders, health economists and the Greens senator, Rachel Siewert.
