The Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 was introduced into the Parliament, despite a similar bill having already passed the House of Representatives.
The predominant difference between the bill which is the subject of this Inquiry, and the earlier bill – the Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 – is the Government’s new policy to make the Cashless Debit Card (CDC) permanent in the existing trial sties, rather than seeking to extend the trial period.
Both bills would extend the CDC to the entire Northern Territory (NT) on a permanent basis, as well as to areas of Cape York for a time-limited period.
The efficacy of the CDC, and income management more generally, has been the subject of several inquiries. Labor Senators note that these investigations have not found evidence of the effectiveness of these policies.
In fact, significant harm has been associated with compulsory, broad-based income management.
Most recently, an independent analysis of the CDC in Ceduna, conducted by the University of South Australia concluded:
We have shown the CDC policy to have had no substantive effect on the available measures for the targeted behaviours of gambling or intoxicant abuse. There is evidence for an increase in total store spending. There is also increased spending on healthy foods, but there is an overall shift toward a higher proportion of spending on less healthy foods.
Commenting on this study, one of the authors, Dr Luke Greenacre said:
From the more quantitative, economic, whole of community perspective, it suggests the card offers very little, if no return on investment. In other words, the cost of implementing and administering the card offers very little, if no return on investment.
Professor Dreise summed this up the current state of the evidence base relevant to the CDC and compulsory, broad-based income management:
…the evidence supporting the impact of both the cashless debit card and the BasicsCard is flimsy and largely anecdotal, not rigorous and reliable. The evidence does not stack up. It does not show that the cashless debit card has had a positive impact, and a very large amount of evidence shows that, after 13 years of new income management in the Northern Territory, it has had almost no positive impact. In some sites, we do not know whether positive gains are attributable to the CDC, as opposed to other interventions, such as alcohol restrictions or increases in social security payments during COVID.
Further, the Royal Australian and New Zealand College of Psychiatrists stated in their submission that there was not clinical evidence to support the CDC:
…we are concerned at the continued pursuit of this policy against the advice of addiction specialists… More than 50 years of psychological research shows that positive reinforcement strategies are more effective than punitive strategies in bringing about behavioural change.
Ms Roe from Aboriginal Peak Organisations Northern Territory (APO NT), said:
The cashless debit card, or welfare card, has not even been adequately evaluated, yet the government is rushing to legislate this. We want to know where the evidence is.
Labor Senators are shocked by the Minister’s admission at Budget Estimates that she had not read the much anticipated $2.5 million Adelaide University evaluation of the CDC trial before the decision was made by the Government to make the card permanent. This is clear evidence that the Government is pursuing this policy regardless of the evidence. The following is an extract from Budget Estimates:
Senator McCarthy: Minister, did you say you’d read the Adelaide report?
Senator Ruston: No.
Labor Senators note the Government did not make the Adelaide University evaluation public in time for it to be considered by this inquiry. The failure to permit the inquiry to examine this evidence is a very clear indication the Government’s pursuit of this bill is ideological.
Labor Senators are very concerned by the lack of consultation undertaken on the proposal to make the CDC permanent, and roll it out across the entire NT. This is part of a long history of inadequate community engagement and policy imposition on First Nations communities, including the discredited policies of the Intervention.
Ms Roe from APO NT summed up the lack of consultation:
In January this year, Minister Ruston promised to consult, visit communities and talk to people over the next five months on the cashless debit card, but we have seen no evidence that this has occurred. With little progress on consultation and no new evidence supporting the cashless debit card, our concerns about the introduction of the card remain unchanged… We need the government to work with us to invest and create real and genuine jobs and training opportunities out in remote communities in the Northern Territory, to overcome dependency on the welfare system and to empower our communities to take greater control in improving their lives and destinies.
Professor Altman raised serious concerns about the continuation of failed approaches to consultation, engagement and public policy:
It concerns me that the current government is looking to continue the Intervention in the Northern Territory on a permanent basis by stealth, by continuing and expanding the reach of the cashless debit card into the Northern Territory.
This view is supported by Labor Senators. 13 years after the Intervention, it is clear that such an approach to service delivery is a failure and has left the people of the NT worse off.
Labor Senators believe the First Nations communities of the NT – and other parts of Australia – should be listened to.
Mr John Paterson from the APO NT, outlined the findings of their consultation with First Nations communities in the NT:
…our perspective on the cashless debit card, from the enormous consultation we’ve had with Aboriginal and Torres Strait Islander communities, is that they don’t want it, hence why we’re calling on the Senate not to support this bill.
Labor Senators are also incredibly disappointed that the Government’s insistence on this bill is counter to the Prime Minister’s commitments to a new partnership approach to Closing the Gap. It is not consistent with genuine partnership, or with a First Nations controlled approach to service delivery.
Professor Dreise told the Committee:
In July, in the new Closing the Gap agreement, governments in Australia made a promise to share decision-making on policy that affects our people with our people. I think that this bill risks breaking this promise, just months after the agreement was signed. Commitments to a new relationship between government and First Nations peoples need to be taken seriously when considering the current bill before the parliament.
Professor Altman also said:
…there is a fundamental inconsistency between what is being proposed by the Productivity Commission as well as in the National Agreement on Closing the Gap and what is included in this far-reaching bill. The government is persisting with an old, discredited approach of dogged imposition from above, counter to the expert advice commissioned by the Treasurer and a recently signed multilateral agreement with the ink hardly dry on the paper.
Ms Roe from APO NT also shares this sentiment:
The bill will not meet the genuine partnership and shared decision-making agreed upon in the recent signing of the National Agreement on Closing the Gap, in July 2020, between the Australian government and the Coalition of Peaks.
At the Committee hearing, serious questions were also raised about the issuing of tens of thousands of unsolicited debit cards. This may not be compliant with section 12DL of the Australian Securities and Investments Commission Act. Labor Senators are calling on the Government urgently clarify the legal standing of their CDC policy.
The Government has established a CDC Technology Working Group, with representatives of the big four banks, the supermarkets, EFTPOS and Australia Post. Labor Senators are concerned that this is a precursor for a national rollout of the CDC.
This is a worry shared by pensioner groups, including the Combined Pensioners and Superannuants Association (CPSA):
People have told CPSA how very fearful they are of being put compulsorily on IM/CDC if the Government is not stopped… CPSA’s ultimate campaign goal is for IM/CDC to be abandoned…
Conclusion
Labor Senators call on the Government to:
Listen to local communities, including First Nations communities;
Invest in job creation, evidence-based services and partnerships with communities, rather than continuing to pursue CDC and broad-based compulsory income management policies;
Abandon its Technology Working Group – and preparations for a national rollout of the CDC.
Around 68 per cent of the people impacted by the restrictions and controls in this bill are First Nations Australians. Labor Senators believe this makes the bill racially discriminatory.
Recommendation
Labor Senators recommend that the bill not be passed.
Senator Malarndirri McCarthy
Senator Patrick Dodson