Blanket Welfare Reforms a Gamble - ACOSS

ACOSS has described the blanket Rudd Government welfare reforms passed in the Senate as a 'gamble' with disadvantaged communities.

The Australian Council of Social Service says it's deeply concerned the compulsory income management scheme, passed by the majority parties in the Senate will alienate people on income support and do little to assist people overcome social issues.

ACOSS CEO, Clare Martin says this poorly targeted, expensive scheme is a gamble with the daily lives of people on the lowest incomes, and a gamble with taxpayers funds.

Martin says the scheme is broader than most people realise and could cover all income support recipients, including age, disability and carer pensioners, who live in areas designated by the Minister.

Described as one of the most significant shifts in the history of social security policy, it involves the government declaring certain communities ''disadvantaged'' and imposing income management on particular groups of welfare recipients who normally live there, firstly in the Northern Territory and then nationally.

Clare Martin says the policy puts finite resources into micro-managing people's daily finances, rather than funding programs including employment assistance, drug and alcohol programs that achieve direct outcomes.

She says compulsory income management will do little to help people move off income support and into employment or training.

She says the Government is willing to gamble $410 million over the next five years to manage 20,000 people in the Northern Territory. Per head, this is eight times the amount – just $500 – provided to an employment services provider to help someone find a job.

As well, ACOSS says the limited consultation on income management for the poorest Australians is in stark contrast to the attention given to the mining industry over their opposition to the mining tax.

According to the Federal Budget papers from 1 July 2010, the new scheme will be introduced throughout the Northern Territory as a whole, including urban, regional and remote areas. According to the Government, this is to be the ‘first step in a national roll out of income management in disadvantaged regions’.

The income management reforms are to apply to:

• People aged 15 to 24 who have been in receipt of Youth Allowance (other), Newstart Allowance, Special Benefit or Parenting Payment for more than three of the last six months
• People aged 25 and above who have been in receipt of specified payments, including Newstart Allowance and Parenting Payment for more than one year in the previous two years
• People referred for income management by child protection authorities and
• People assessed by Centrelink social workers as requiring income management due to vulnerability to financial crisis, domestic violence or economic abuse.

The Budget paper says affected income support recipients will have 50 percent of their regular payments (70 percent in child protection cases) and 100 percent of lump sum payments quarantined in a separate account that may only be used for the purchase of ‘the essentials of life’, such as food, clothes and rent. The Government expects that around 20,000 individuals are expected to be covered by income management in the Northern Territory when it is fully implemented

ACOSS says it does see income management as a useful role where individuals or communities choose to use it. It then becomes a tool for them to help overcome entrenched social problems rather than a clumsy imposition from Canberra.

Martin says this Bill only partially reinstates the Racial Discrimination Act, leaving parts of the Northern Territory Intervention still in breach of human rights, including compulsory leases of Aboriginal lands. ACOSS is calling on the Government to reinstate the Act in full, and as soon as possible.

She says it is disappointing that the major parties have approved such a radical and harmful change to our social security system with so little public consultation and debate. 

The Australian Greens  is the only party to have consistently opposed this legislation in the Parliament.