Cashless Welfare Card Should be Halted – Welfare Experts

Welfare experts have called on the Australian Senate to “push the pause” button on the government’s cashless welfare card trial.

As the country marks Anti-Poverty Week, the National Welfare Rights Network (NWRN) said it was not time for the government to forge ahead with the cashless card.

The government wants to trial the card, which if approved, would restrict people’s access to cash by quarantining up to 80 per cent of it, in a bid to prevent welfare recipients buying alcohol, gambling and spending money on drugs.

The trial is flagged to begin in Ceduna, a town in South Australia with a the highest percentage of Aboriginal people of all local government areas in the state.

NWRN President, Kate Beaumont, said the government should instead look at providing “desperately needed” alcohol and drug rehabilitation services in Ceduna.

“It is time to look for community solutions that work, are effective, and that have the broadest possible support on the ground,” Beaumont said.

“There are just too many unknowns about how the debit card trial will work in practice. We do not have answers to critical questions, such as what additional services will be provided, which financial institution will deliver the card, and whether trial participants will have to bear additional fees and surcharges related to use of the mandated card.”

Beaumont said new data from the Federal Government revealed that almost three quarters of people that would be affected by the cashless welfare card in Ceduna identify as Aboriginal and Torres Strait Islander.

She said Ceduna had a total Indigenous population of 1226, and 47 per cent would be subject to the proposed debit card controls.

“While Indigenous people in Ceduna account for 30 per cent of the population, they are 72 per cent of those who will be forced onto this trial. It is expected that 583 Indigenous people will be required to use the welfare card, compared to 224 non-Indigenous people,” she said.

“With the trial 80 per cent of a person’s payments will be paid into a cashless debit card with the remaining 20 per cent being paid to their nominated bank account. For the restricted amount to fall below 80 per cent, a person will have to petition a local community body on the ground which has yet to be established. In Cape York, a retired magistrate makes these decisions as part of the Families Responsibilities Commission.

“There have been promises of much needed support services for the local communities subject to the trials, but there are as yet no guarantees of what services are to be provided and who will be providing the funding for this during the trial and what will happen after the trial concludes after 12 months.

“Unlike other forms of income management we cannot see any way in which a person is able to seek an exemption from the trial. The absence of any general exemptions means that cash restrictions will be applied, even though it may be harmful or detrimental to a person’s wellbeing or mental health.”

Assistant Social Services Minister, Alan Tudge, said the Government would provide Ceduna additional funding for the trial period, including money for a new mobile patrol team on duty 24 hours a day, increased drug and alcohol counselling services, along with mental health support and expanding access to financial counselling.

"That package will complement the operation of the cashless debit card in order to do as much as humanly possible to reduce the welfare-fuelled alcohol abuse in that community," Tudge told the ABC.

"It's actually quite comprehensive because it builds on existing services in the community. So that they can hopefully better budget their money and better ensure they can make ends meet across the welfare fortnight."

A Senate report on the cashless welfare card is due to be released this week.