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Thursday, 4 April 2019
Page: 14925

Cashless Debit Card

Dear Mrs Wicks

Thank you for your letter of 16 August 2017 to the Minister of Social Services, the Hon Christian Porter MP. regarding petition EN0240 - Cashless Debit Card trial. Your letter has been referred to me as the matter raised falls within my portfolio responsibilities.

I note the petition calling for the Cashless Debit Card (CDC) not to be introduced in the Hinkler electorate was presented to the House of Representatives on 14 August 2017 and acknowledge the concerns of the 330 signatories.

On 21 September 2017, the Commonwealth Government announced the federal electorate of Hinkler as a new CDC site, with rollout to commence early next year. In selecting the region as a site for the CDC, the Government considered two key factors. Firstly the need for strong community leadership support, and second, a demonstrable social need.

Consultation in Hinkler about the CDC

In May and June 2017, I visited Bundaberg and Hervey Bay with the Member for Hinkler, the Hon Keith Pitt MP. I met with state government services, business groups, welfare organisations and church leaders, and heard first-hand about the issues facing the region. During these consultations, broad support for the introduction of the card was evident.

From July to September 2017, the Department of Social Services (the Department) conducted extensive consultations regarding the CDC program in Bundaberg, Hervey Bay and Childers. More than 180 consultations were held, with the Department reporting strong support for a rollout of the card. Consultations were held with:

the community sector;

service providers;

Commonwealth agencies;

local government;

Queensland Government;

the business sector; and

community members (including public forums).

Social issues being faced in the region and how the CDC can help

The Bundaberg/Hervey Bay region was chosen based on consultations with community leaders , which identified three pressing social challenges which may be helped by the card: high youth unemployment and entrenched welfare dependence, young families requiring support and higher than average drug and alcohol use.

The region has the second highest youth unemployment rate in Queensland at 23.6 per cent, with many now experiencing intergenerational welfare dependence. Of those who are under 30 years of age on unemployment benefits today, 90 per cent had a parent who was also on welfare during the past 15 years. Without any intervention, it is projected that approximately 57 per cent of Newstart and Youth Allowance (job seeker) participants aged 30 and under in Bundaberg and the Fraser Coast will still be receiving income support in 10 years' time.

The Department also received feedback that the needs of young children were not being met. Community organisations providing emergency relief and housing advised that their services were increasingly being utilised by young families. A number of these organisations reported that some parents were spending most of their time and money drinking alcohol, which is having a detrimental impact on their ability to provide food, schooling and other activities for their children.

The introduction of the CDC in Hinkler aims to provide an opportunity for parents to ensure that their children are well cared for and to improve employment prospects for young people. As evidenced further below, the independent evaluation of the CDC found the program had achieved "considerable positive impacts" in the first two trial sites, specifically in relation to drug and alcohol use, participants being better able to care for their children and by increasing motivation to find employment.

Approach to implementation

The Commonwealth Government is committed to building collaborative working relationships with local and state governments to assist in the implementation and ongoing monitoring of the program. The Commonwealth Government will continually monitor and review the impact of the program.

The Commonwealth Government has also established a Community Reference Group comprised of local experts from different sectors across the Bundaberg and Hervey Bay area. This Group will meet regularly to provide advice to the Commonwealth Government and feedback on the views of the community.

The Department is also engaging with local support services to ensure the $1 million in federal support services funding meets the needs of the community.

Independent evaluation shows the CDC is effective

The final independent evaluation of the current CDC trial sites in the East Kimberley, Western Australia. and Ceduna, South Australia, found that the CDC has had a "considerable positive impact" in the communities where it has operated. It also showed that people had become more accepting of the card over time.

The complete final evaluation report is available at www.dss.gov.au/families-and-children/progams-services/welfare-quarantining/cashless-debit-card-trial-evaluation-reports.

The evaluation concluded that the Cashless Debit Card, "has been effective in reducing alcohol consumption and gambling in both trial sites and [is] also suggestive of a reduction in the use of illegal drugs."

In particular, the evaluation found that:

of those who drank alcohol before the trial started, 41 per cent said they are drinking alcohol less often;

of those surveyed who said they had drunk six or more drinks at once before the trial started, 37 per cent reported they did this less often;

of those surveyed who said they were using illegal drugs before the trial started, 48 per cent reported using these less since the CDC's introduction;

of those surveyed who said they gambled before the trial started, 48 per cent reported gambling less;

increased motivation to find employment; and

of participants with caring responsibilities, 40 per cent reported being able to better care for their children since being on the card. and 39 per cent reported being more involved in their children's homework and school.

The evaluation also found widespread positive spill over benefits from the CDC, including:

Forty-five per cent of participants reported being able to save more money than before the trial; and

Stakeholders reporting a decrease in requests for emergency food relief and financial assistance, and increased purchases of baby items, food, clothing, shoes, toys and other goods for children.

The evaluation showed no increase in crime rates attributable to the introduction of the card. In fact, both qualitative and quantitative research found that crime and violence had reduced over the duration of the CDC trial, specifically, there was "considerable observable evidence being cited by many community leaders and stakeholders of a reduction in crime, violence and harmful behaviours". For example, local merchants and police reported that they had observed fewer incidents of theft involving food-related items and clothing. Most stakeholders and community leaders reported that violent and aggressive behaviours had also reduced, including public acts of aggression.

There is no evidence of the CDC stifling economic growth. The card works like any other Visa debit card and can be used at any business with EFTPOS facilities that does not primarily sell alcohol or gambling products.

I am committed to ongoing communication with the community to ensure that all stakeholders have access to accurate information about the program and how the card works.

Thank you for bringing this petition to my attention. I trust this information has been of assistance.

Yours sincerely

from the Minister for Human Services, Mr Tudge(Petition No. EN0240)