Labor Senators do not support the recommendation of the Committee majority report.
We oppose this legislation in its current form, in particular the establishment of the entirety of the Northern Territory as a trial site with all income management participants transitioned to the cashless debit card (CDC) on a compulsory basis.
Labor Senators call on the Senate to oppose this legislation extending the CDC to more than 23 000 Australians as there is no independent, verified evidence to support the efficacy of broad-based income management in reducing social harm.
Overview from Labor Senators
On 12 September 2019, the Senate referred the Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 to the Senate Community Affairs Legislation Committee for inquiry and report.
The Bill amends the Social Security (Administration) Act 1999 to:
extend the end date for existing CDC trial areas from 30 June 2020 to 30 June 2021 and establish an end date for the CDC trial in the Cape York area of 31 December 2021;
remove the cap on the number of CDC trial participants;
remove the exclusion to allow people in the Bundaberg and Hervey Bay trial area to be able to voluntarily participate in the CDC trial;
establish the Northern Territory and Cape York areas as CDC trial areas and transition income management participants in these sites onto the CDC trial in 2020; and
enable the secretary to advise a community body when a person has exited the CDC trial and remove the requirement that an evaluation be conducted by an independent expert within 6 months of the completion of a review of the CDC trial.
The overwhelming majority of the 108 submissions to this inquiry oppose the Bill, as did the majority of witnesses to this inquiry.
Opposition to this Bill included concerns that:
there is no independent rigorous evaluation of the CDC in the trial sites that indicates it is effective in reducing social harms, particularly in reducing the harmful use of alcohol and other substances;
this Bill gives the Minister extraordinary power to determine the level of restricted payments;
flaws in the operation of the CDC, i.e. that the CDC can be used to purchase supposedly banned items; and
there has been no real consultation with Northern Territory stakeholders and affected communities regarding the planned rollout of the CDC.
Flaws in the CDC
The Committee heard evidence around significant flaws in the legislation and the operations of the CDC, including extending the provision of compulsory income management.
Evidence from the North Australian Aboriginal Justice Agency (NAAJA):
Currently, in the Northern Territory, individuals on social security payments are not compelled into income management unless they have been specifically referred to the scheme or they have been on social security payments for a period of three months for young people or a year for adults. Under the CDC scheme, individuals on certain social security payments will have their payments compulsorily restricted straightaway after being provided with a notice telling them that they are going to enter the scheme.
This notice will not be reviewable. There are specific provisions in the bill that take away the right of an individual to seek review of the decision to be issued with a CDC notice, either by the secretary or by the AAT. Income management in the Northern Territory is a system that applies very broadly, and is not targeted to individuals who have specific vulnerabilities. CDC further expands this scheme and is more of a blanket approach. NAAJA opposes the compulsory application of a broad-based policy to income recipients that largely targets Aboriginal people, regardless of their situation. Once a person is put into a CDC scheme, it is likely that it will be very difficult for them to exit compulsory management. NAAJA has concerns about the ability of Aboriginal people, particularly in remote communities, to apply for exemptions or to be exited from the scheme.
Labor Senators agree with concerns raised around access to the card and supports to deal with any issues arising from its use.
Evidence from the Northern Territory Government:
Our understanding is that this process would be delivered outside the current Centrelink process, with cards delivered by mail, which is of extreme concern to us. People would be required to utilise websites, emails and call centres to receive the card, make balance inquiries, manage loss of cards and make other inquiries. This will be difficult for people living in remote locations with limited phone and web access and very poor postal services—and impossible for people living more remotely in one of the Territory's 500 homelands or outstations. It is our strong view that a significant body of work needs to be undertaken to examine how these arrangements can work in remote areas. We do not see this working and remain highly concerned about the impact on existing social crisis services when a number of people will be unable to access their funds.
The loopholes in the CDC provisions that allow participants to purchase supposedly banned items such as alcohol through the use of credit cards and barter-type arrangements with unscrupulous individuals is of great concern to Labor Senators. These loopholes bring into questions the effectiveness of the card.
This was summed up in comments by Senator Lambie:
So I can go and get eight bottles of wine on my Visa card and you guys have got no idea, and I can just pay it off with my other card. That's a new one. That's a beauty! Everyone will be getting Visa cards tomorrow, watch.
Lack of consultation with Northern Territory communities
Labor Senators are concerned this Bill is being introduced with no real consultation with communities in the NT.
Despite the recommendation in the majority report, there was little evidence given of any widespread, comprehensive consultations having taken place in the Northern Territory regarding the introduction of the CDC. The evidence suggests completely the opposite, with major stakeholders either not being informed or having just been given information about how the CDC will take effect.
Evidence given by the Central Land Council in Alice Springs:
The Central Land Council's 90 delegates met this week under the shadow of Uluru. They expressed their frustration at hearing for the first time about the federal government's plan to roll out the cashless debit card without their knowledge or consent.
There is hurt—deep hurt—and frustration too at the lack of meaningful consultation that has happened about this major proposal that will impact on all of their lives.
As with the intervention, the cashless debit card is being rolled forward without consultation or consideration of what might work best for people on the ground. This is extraordinary given the fact that more than 35,000 Territorians have had direct experience of income management over the past 12 years, the majority of them being Aboriginal and living in remote communities where life is already very tough. Services are limited and food and other essential items are 60 per cent more costly than those available in major urban centres. Yet their views are not being sought. Information sessions or briefings being conducted by DSS staff do not constitute consultation, a lesson that should have been learned by governments long ago.
Evidence given by NPY Women’s Council Vice Chair Mrs Ngungita (Margaret) Smith:
We don't need more cards on our back. I'm talking for my people. You should have consulted before going into governments talking about new systems coming up for our Aboriginal people. I know, myself, I've got your language and my language. I'm a cultural woman, very strong in our culture. We don't need more cards on our system. We're already poor. I'm not happy with this new system anyway. That's what we feel.
Powers of the Minister
The Senate Standing Committee for the Scrutiny of Bills expressed concerns about the extension of the Minister's powers under the Act. It noted that proposed subsections 124PJ(2A) and (2B) would confer on the minister a broad power to determine the portion of a participants' payments that are restricted.
Labor Senators share this concern that there are very few defined checks and balances on the Minister's power in this regard. We note the recommendation that DSS clarify the Minister's powers but this does not provide sufficient safeguards if this Bill is passed.
Lack of evidence to support broad-based compulsory income management benefits
Broad-based compulsory income management was introduced to the Northern Territory 12 years ago under the NT Emergency Response.
There is no robust evaluation on the BasicsCard, the mechanism used by recipients to access their quarantined income payments, that it reduces social harm.
Evidence from Danila Dilba Health Service:
More than 23,000 Aboriginal people have been subjected to income management or income quarantining since 2007. The original objectives of income management were supposedly to improve the health, wellbeing and education outcomes of Aboriginal children and to protect women and older people from humbugging and violence. During the period 2007 to the present time, some 12 years, there is an absolutely astonishing lack of credible evidence that income management has made any significant improvement to any of the key indicators of wellbeing: child health, birth weights, failure to thrive, and child protection notifications and substantiations. There are no improvements in school attendance, and certainly nothing we can see would suggest that there has been a reduction in family or community violence.
Given the Government contends this Bill is a 'swap' for recipients from one tool to another, i.e. from BasicsCard to CDC, the lack of evidence regarding the efficacy of either card brings into question why this legislation is being imposed.
In fact, many submitters and witnesses provided evidence of negative impacts of both the BasicsCard and the CDC.
Two of the stated objectives of the cashless debit card are to ensure that vulnerable people are protected from the abuse of substances and any associated harm and violence, as well as giving people increased ability to meet their basic needs. Some witnesses and submitters gave evidence that a CDC could exacerbate the harms it was purportedly meant to reduce.
Evidence from MoneyMob Talkabout Limited:
What our data suggests is that potentially welfare quarantining can cause the opposite to happen. While older people and people with disabilities won't be directly put on the CDC, it's unlikely to stop them from being targeted because they receive those higher payments, such as an aged pension or a disability pension. We're seeing them currently having their cards and income management allocations taken and used by other people who've already expended their income. So it's actually increasing their vulnerability and diminishing their ability to meet their basic needs.
The issue of increased elder abuse was touched on briefly by the University of Adelaide in their CDC baseline data collection research in the Goldfields region, but we're not aware of any systemic focus on measuring the incidence of elder or disability abuse in relation to income management or the CDC. This raises the possibility that one type of vulnerability could be just supplanting another one.
An extensive study by the Menzies School of Health Research found evidence that the birthweight of Indigenous babies declined under compulsory income management. Birth weight is known to be a strong predictor and outcome of disadvantage and is one of the main outcome indicators of the Closing the Gap strategy.
Evidence from Professor Sven Silburn, Menzies School of Health:
What we can say is that NT Aboriginal birth weight outcomes have not improved since 2009 and the gap between Aboriginal and non-Aboriginal rates of low birth rate in the NT have widened.
In summary, we believe these findings suggest that income management as a component of the Northern Territory Emergency Response has not contributed to any improvement in Aboriginal birth outcomes. Also, because of the extremely high cost of set-up and maintenance of the system during that time, it amounted to around $20,000 per income-managed person. We believe this was a very expensive policy experiment with, from what we can see, very little definitive indication of positive benefit.
This Bill does not appear to be consistent with current Federal Government policies such as Closing the Gap.
Evidence given by the Central Land Council in Alice Springs:
It is not consistent with the collaborative and consultative spirit of the next phase of Closing the Gap or the broad reform agenda of the NIAA seeking to return decision-making and control to Aboriginal people across a range of sectors, including health, housing and education.
The Committee heard evidence regarding community driven initiatives to reduce social harm that had support and had recorded positive outcomes.
The Arnhem Land Progress Association's (ALPA) FOODCard and Tangentyere Council's previous voluntary income management system were cited as evidence of community driven solutions that should be supported by Governments.
Evidence given by Tangentyere Council:
Aboriginal people would utilise the Westpac banking system within Tangentyere Council itself and surrender part of their own income, and we would administer the hard cash through our Westpac bank and provide what is now the BasicsCard on a food order system through the council.
Senator SIEWERT: So that was a voluntary program?
Mr Shaw: It was voluntary. People would voluntarily surrender parts of their income. They had a social safety net of Tangentyere looking after their income and ensuring that they have money on their off weeks of payment as well.
The ALPA FOODcard, which is an innovative model that was co-designed in consultation with its customers. First trialled in 2007 at the Galiwin'ku community, the ALPA FOODcard has successfully been used as a voluntary family budgeting tool and is a component of ALPA's nutrition program.
Over 12 500 people living in the five Arnhem Land communities chose to apply for an ALPA FOODcard from 2008 to 2018. The underlying principle applied by the ALPA board of directors is that each customer is able to make their own choice about how their money is spent and how they, the individual, wish to allocate those funds on the card. This empowers people to make decisions that affect their own family's needs, which can change on the basis of cultural and kinship relationships.
Extensive community consultation determined what could be purchased. This included most grocery items and baby requirements in line with ALPA's healthy choice policy. Excluded items include soft drinks, cigarettes, tobacco and toys. Categories are regularly refined and evaluated based on feedback from cardholders, store committees and the ALPA board of directors. Since its inception in 2007, ALPA members have used this tool to voluntarily allocate over $15 million to these healthy choices.
ALPA do not believe that FOODcard will be the solution for everywhere. It was designed by our members in East Arnhem Land for use in our communities at their request. We do believe that voluntary solutions are the answer and that communities and community organisations are best placed to support meaningful and sustainable change. One-size-fits-all interventions from the government have not delivered positive change, despite a decade of oppressing our members and our communities. It is time for a different approach.
The Northern Territory Government's alcohol management policies were also cited as evidence of policies that are working to reduce alcohol related harm.
Evidence from Danila Dilba Health Service:
What I think has made the biggest change here in the Territory is the banned drinker register, not the BasicsCard. That is, if you're charged with an alcohol related offence, there is a complete prohibition on your ability to purchase alcohol. That has directly benefited people—particularly, say, in Alice Springs, where it's had a significant positive impact.
Concluding view
Labor Senators oppose the Government's plan to expand the CDC across the Northern Territory, as it is not supported by evidence.
Twelve years after it was introduced, there is no evidence that broad-based compulsory income management has worked in the Northern Territory to improve outcomes.
Labor Senators are also concerned about the lack of local consultation and the absence of consent for this proposed policy in the Northern Territory.
Labor Senators do not believe the CDC trials should be extended or expanded unless:
the card is made voluntary;
it is only applied in specific instances, with intensive case management and is time limited, e.g. child protection; or
a community genuinely gives their informed consent to trial the card, consistent with self-determination.
Recommendation
Labor Senators recommend that the Senate does not pass the Bill in its current form.
Senator Malarndirri McCarthy