The Social Services Legislation Amendment (Drug Testing Trial) Bill 2018 amends the Social Security Act 1991 and Social Security (Administration) Act 1999 to establish a two year drug testing trial in three regions for 5,000 new recipients of Newstart Allowance and Youth Allowance from 1 July 2018.

This measure was first put forward as Schedule 12 of the Social Services Legislation Amendment (Welfare Reform) Bill 2017. After failing to gain support for the measure during negotiations in the Senate, the Government dropped this schedule from the Bill.

The major difference between the 2018 Bill and Schedule 12 of the 2017 Bill is that the 2018 Bill specifies the location of the trial sites. The Bills Digest for the Social Services Legislation Amendment (Welfare Reform) Bill 2017 provides more detail on the measure (note: the digest was written before it was clear that the Government had chosen to rely on income management rather than the Cashless Debit Card).

Rationale

In the Explanatory Memorandum (EM) for the 2018 Bill the Government argues that abusing illicit drugs prevents jobseekers from finding work and ‘is not consistent with community expectations around receiving taxpayer funded welfare payments.’ According to the EM:

The aim of the trial is to improve a recipient’s capacity to find employment or participate in education or training by identifying people with drug use issues and assisting them to undertake treatment (p. 4).

Ministers have insisted that the trial is designed to help income support recipients with substance abuse problems, not stigmatise or penalise them.

How the trial will work

Five thousand new recipients of Newstart Allowance and Youth Allowance (other) in the three trial sites will be randomly selected to take a drug test. Those who test positive to an illicit drug will be placed on income management for two years.

Recipients who test positive to the first test will be asked to take another test within 25 working days. If they test positive again at that time, or at any time during the two-year income management period, they will be referred to a Department of Human Services’ contracted medical professional who can recommend treatment activities. If treatment is recommended, it will form part of the recipient’s Job Plan.

If a recipient refuses to take a drug test the Department will cancel their payment. Recipients who test positive to second or subsequent tests will be required to repay the cost of the test.

According to evidence given in Senate Estimates in August 2017, the Department of Social Services expects to test 5,000 recipients across the three trial sites with around 420 to 450 testing positive on the first test and between 100 and 120 going through to a medical assessment.

Income management

There are currently two ways to restrict an income support recipient’s spending. The first is income management which relies on a combination of automatic deductions (for expenses such as rent and utilities) and the Basicscard. The second is the Cashless Debit Card.

The Government has chosen to use income management for the drug testing trial. According to the Department of Social Services (pdf), income management ‘provides a more individualised approach to welfare quarantining than the Cashless Debit Card.’

For a comparison of the two measures see: ‘BasicsCard and Cashless Debit Card: What’s the difference?’

Trial sites

The Government has chosen three locations where income management is already operating as sites for the drug testing trial— Canterbury-Bankstown (New South Wales), Logan (Queensland), and Mandurah (Western Australia).

These locations are listed in the Bill. This marks a change from Schedule 12 of the Social Services Legislation Amendment (Welfare Reform) Bill 2017 which did not list the trial sites. Instead the earlier Bill stated that there could be up to three discrete areas and that the Minister could prescribe the sites using a legislative instrument (the drug test rules).

Issues

While some media commentators voiced support, the Government’s proposed drug testing trial attracted strong criticism from drug policy experts, health professionals, peak welfare and employment services bodies, and others (see the Bills Digest for details). Issues raised about the measure include:

• lack of consultation during policy development
• lack of a clear explanation why recipients who test positive only once need to be placed on income management for two years
• claims that it is more about signalling disapproval of drug taking than helping income support recipients find work
• concerns about stigmatisation of both locations and individuals
• concerns about whether an evaluation of the trial will provide strong enough evidence to determine whether it was effective.

As noted above, further details can be found in the Bills Digest for the Social Services Legislation Amendment (Welfare Reform) Bill 2017.