Cashless welfare card to be folded
Labor will push ahead with plans to abolish the cashless debit card scheme, dividing Indigenous leaders but winning support from welfare advocates.
Labor will push ahead with plans to abolish the cashless debit card scheme, dividing Indigenous leaders but winning support from welfare advocates.
Social Services Minister Amanda Rishworth on Friday said she was in discussions to terminate the program, which was a Labor election commitment. She pledged to work with communities to find “better local solutions”.
The decision followed an Australian National Audit Office report released on Thursday which highlighted a lack of evidence to demonstrate the effectiveness of the scheme.
“The former Coalition government spent more than $170m on the privatised cashless debit card – money that could have been spent on services locals need,” Ms Rishworth said.
Implemented under the Abbott government in 2016, the scheme was designed to encourage socially responsible behaviour by quarantining 80 per cent of a person’s welfare payments on a debit card to prevent it being spent on alcohol and gambling.
It was initially introduced in Ceduna, South Australia, East Kimberley and the Goldfields in Western Australia, and then expanded to Bundaberg and Hervey Bay in Queensland. The cost of the program reached $36m in 2020-21, with nearly 17,000 people participating as of February this year.
Pat Turner, chief executive of the National Aboriginal Community Controlled Health Organisation, said the scheme had caused “unnecessary embarrassment” for Indigenous Australians. “I certainly welcome the scrapping of the cashless debit card,” she said. “The Auditor-General’s report confirms what we already knew and why we were so opposed to the scheme. It’s simply poor public policy to run trials as the former government did for five years.”
But Warren Mundine, who was Indigenous Advisory Council chair when the scheme was introduced, said the move might lead to a rise in violence and substance abuse. He said the scheme was part of a wider package of policies designed to ensure communities were safer, and accused Labor of being “out of touch”.
“I see two dreadful things coming together at the moment, in allowing alcohol back into communities and scrapping the cashless card,” Mr Mundine said.
“I find it really frustrating when you’re trying to make communities safe, encourage businesses to go into communities, and deal with real problems for women and kids. I just hope to god that this is not a political move and they actually have some serious plans.”
Former social services minister Anne Ruston accused the government of being “beholden to the left”, saying it had failed to consult with communities before making its “reckless” commitment. Labor had promised to first consult with communities where the scheme has been trialled.
“Labor’s ill-fated attempt to hang on to votes with the inner-city, latte-sipping crowds on the east coast through its election commitment to scrap these cards was made without any regard for the devastating impact it will have,” Senator Ruston said.
Australian Council of Social Services CEO Cassandra Goldie said there was no conclusive evidence to suggest mandatory income quarantining helped alleviate poverty, addiction or other social issues.
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