‘I go in, come out, and I'm all in tears’: Vulnerable people humiliated by cashless welfare card
26 February 2020 at 2:27 pm
Experts say compulsory income management is doing more harm than good
The cashless welfare card has failed to improve the financial stability of social security recipients and has instead left many feeling embarrassed and unable to pay their bills, new research shows.
An independent study into Australia’s compulsory income management policies uncovered an “overwhelming number of negative experiences” relating to the cashless welfare card, leading researchers to question the merits of this approach.
Dr Michelle Peterie said the social, emotional and economic costs of the card – which locks 80 per cent of welfare payments onto a debit card and cannot be used to withdraw cash or be spent on alcohol or gambling – outweighed its benefits.
“The overwhelming finding is that compulsory income management is having a disabling rather than enabling effect on the lives of many social security recipients,” Peterie said.
“This was true across all of our research sites.”
The card has been trialled in East Kimberley and Ceduna since 2016, and the Goldfields region since March last year. It was also introduced in Queensland’s Hervey Bay-Bundaberg region in 2019.
Researchers conducted 114 in-depth interviews at four trial sites, and surveyed 199 people.
A large majority of respondents (84 per cent) said they felt stigma and/or shame either sometimes or all the time when paying for goods using the cashless welfare card, or the similar BasicsCard.
“I go in, come out, and I’m all in tears. I just don’t want to go home. I just want to stand in the middle of the road and get run over, mate. That’s how I feel,” one respondent said.
Another person said the card made them feel like less of a person.
“Instantly people think I’m a dole bludger, alcoholic, druggy and the list goes on,” they said.
“Little do they know I never [saw] myself becoming a single mother to two young children, but I am trying my hardest through university to obtain a degree so I can get off welfare and support my family.”
One respondent said when using the card they received “dirty looks, snide remarks, and… verbal abuse at times.”
The Coalition government has consistently defended the card as “one of the most positive developments in welfare for decades” that has made a real difference in the lives of thousands of Australians.
But while the government has spruiked the card’s benefits to strengthen recipients’ financial independence and help transition people away from welfare dependency and into work, researchers say there is no clear evidence to suggest this is the case.
Professor Greg Marston said income management had actually made it harder for many people to budget.
“There have been recent moves to extend the [card] across the Northern Territory, but our findings show that [compulsory income management] has in fact weakened many participants’ financial capabilities and autonomy,” Marston said.
“To manage their finances, many participants have become reliant on family members, service providers or automatic payment systems.”
The report concluded that a policy approach focused on providing jobs and training opportunities, as well as access to social services and affordable housing, would be a better way to reduce unemployment and help vulnerable people.
Greens Senator Rachel Siewert, a long-time critic of the card, said this research was a stark reminder that income management had met none of its stated objectives.
“If this government wanted to assist people to face barriers like poverty, addiction and unemployment they would immediately increase Newstart and invest in community-led wrap around services rather than punishing them with this expensive and punitive program,” Siewert said.
“This card needs to be stopped.”
Australian Council of Social Service CEO Dr Cassandra Goldie added that it was clear many people felt humiliated when they had to pay with the card.
“The card compounds the sense of shame many people feel about being unemployed when they are doing all they can to find paid work in today’s competitive job market with only one job available for every eight people looking,” Goldie said.
ACOSS is urging the Senate to block any move by the government to extend the program.