FORREST, Mr John Andrew, Chairman, Minderoo Foundation

Evidence taken via videoconference —

CHAIR: I welcome Mr Andrew Forrest. I remind senators and witnesses that parliamentary privilege does not apply to countries or persons outside of Australia. Could you confirm that information on parliamentary privilege and the protection of witnesses and evidence has been provided to you?

Mr Forrest : Yes, thank you.

CHAIR: I now invite you, if you would like to, to make a short opening statement and then we will move to questions.

Mr Forrest : Thank you. Very good afternoon, I apologise that I cannot be with you in person. I dearly would love to have been. I would just like to talk to you briefly and then take any questions you wish to ask on the healthy welfare card. The card has really been an evolution of my life, having grown up with Indigenous people in a loving and caring community. As we all know, in our country you do not have to be Indigenous to grow up in an Indigenous community and vice versa. I have had that very fortunate privilege of a close association where many of my mentors and the elders who I respected most were Indigenous and guided me.

Unfortunately, over the 40- or 50-year period that I can remember, I have seen the degradation of communities at the hands of alcohol and drugs. As many would know, in those communities there is a very high rate of attendance at funerals of friends and people who, like me, were bright-eyed, confident, happy and looking forward to living a full and secure life in Australia as youth. I feel that has been denied to so many of our vulnerable Australians, both Indigenous and non-Indigenous, through disproportionate access to alcohol and drugs in vulnerable communities. These are the great destroyers of community, of lives.

I have had so many situations where, in doing this review over a 12- to 18-month period and even up to leaving for the Ukraine, where I am today, I have had deep and heartbreaking personal experiences where mothers, thinking that I am government—and, of course, that would be your privilege—and thinking I can somehow influence it, have taken my shoulders in their hands and shaken me and said: 'What are you going to do about it? Why will the government continue supplying this environment where my children are likely to continue on the path of their peers and commit suicide or live welfare driven lives where they feel hopelessness?' They feel that it is the system. We have given them a system which, through that blur of alcohol and drugs in their communities, they feel has set them upon a path that we want for them of exclusion from mainstream community and society and exclusion from the mainstream economy. And of course all of us who sit here at this Senate inquiry know that is just simply not true. But we did not have the technology previously. We did not have the ability to look through and help people with drug and alcohol problems. We did not have the technical ability to help entire communities with drug and alcohol disability, but we do now. So I ask the inquiry to embrace these trials.

These trials are important to these communities. They are important to the elders, who have widely consulted amongst their communities and where everything else has failed, over certainly my lifetime. We have a technology which can exclude alcohol and drugs for 80 per cent of their income, leaving, if necessary, 20 per cent in cash. Then we are at least not giving up on these vulnerable Australians. And that is what I ask of this Senate inquiry. I ask you to recognise that this is nothing like the BasicsCard. I ask anyone who has had experience with a BasicsCard to not hold this debit card up as a straw man and compare it to the BasicsCard, which is, of course, a card issued by Centrelink, not a banking or mainstream financial organisation at all, and not able to produce an instrument which is exactly the same as the debit and credit cards in your own purses and wallets—able to be used to buy goods and services, pay the rent and all the other incidentals of life which you and I take for granted. But it helps them make proper choices when the drug dealer is on their child's doorstep or when they feel the pull of alcoholism, which most of us have never felt, but is overwhelming amongst those which have suffered its addiction. It is to assist those people.

Now, I do not for a moment recommend that we trial this new technology in these communities, even though they are asking us loudly and clearly for it, without all of the proper and comprehensive services as recommended in the review. People will need help to come off alcohol and will need help to come off drugs, like any of us will know who has ever been in that situation or has known anyone who has been. They need the extra assistance. But just because they do need that does not mean we give up on them and do not give them the choice. We allow them that choice and we certainly allow them the services to help them get through that challenge. And what arrives on the other side is stronger families, stronger individuals and, as a result, stronger communities who can independently make their own sustainable way in life.

That is why I recommend the card to you. I recommend it to all communities who have had the proper consultation, who have the proper support services and who know that everything else you have given them has failed. With that, I am very happy to take your questions, and I thank you very much for serving on the committee and having such interest to deeply inquire into this card.

CHAIR: Thank you very much, Mr Forrest, and thank you for the work that you have done. We have heard some criticisms from some quarters. There is a lot of support within the community, say, in Ceduna. There are some who oppose it. We have heard from both points of view in that community. We have also heard from some academics and others saying this is really a bit paternalistic and limits people's human rights. I am interested in your response to those criticisms.

Mr Forrest : I, of course, in my work, anti-slavery, which has brought me to Ukraine, employ the services of academics, and I would like to say that this card is not remotely paternalistic. Anything which gives thinking adults caring for community—experienced adults—an ability to further help their community is not paternalistic. To deny those Australians that basic right without a trial, to deny them access to a better technology which has transformed our own lives in this inquiry—and, of course, where I sit now in Ukraine—is very paternalistic. We discuss paternalism when we are thinking about denying the ability of a new technology to assist an individual and a community through books or through politics or through our own experiences, but we personally would seek to deny someone else the right to something which they have asked for, which they need and which in no way is a flagrant breach of law. They see it could help them with their communities when they know there are no other alternatives which have been available. I would say that is paternalistic, and we must not do that. We must allow communities their right to trial this new technology to help their own sons and daughters.

CHAIR: Thank you.

Senator MOORE: I only have a couple of questions, Mr Forrest. I have been asking the people in Ceduna about the need for the other services to go with the trial of the card, and I was really pleased to hear you mention that in your opening statement. It is my view, and I think the view of a number of us, that you can never have a single response. Could you give us a little bit more information about what you would understand the wraparound services should be in the community to actually allow the response that you are seeking out of this trial.

Mr Forrest : I look at this as I would look at assisting anyone else who suffers at the hands of alcohol and drug use, and that is to make available to that community and to those people full access to the counselling which they need to transform their lives. If we were to introduce the card without that support, I would be withdrawing my support for the card. People will need personal assistance, and the community will need community assistance, through the transition from the suffering they currently have at the hands of alcohol and drugs to the clarity and the ability to make proper decisions once one comes out the other side.

We have kept 20 per cent of the card as cash. I am not particularly in favour of that, but for those people who may have been used to spending 50 to 60 per cent, sometimes 100 per cent, of their welfare on substance abuse, then that 80 per cent will be enormously helpful. They will still have 20 per cent in order to come down, over time, off their very negative drug and alcohol habits. That is not the only assistance; the real assistance is the counselling, the care, even just a shoulder to lean on, and particularly police services to ensure that if there is potential for the crime rate to increase as people seek other avenues to find cash then the community is allowed the ability to countermand that. I do think the card must be accompanied by those support services, just as any person or any community coming through drug and alcohol addiction needs support to transition through that phase and come out strongly and brightly on the other side.

Senator MOORE: Would you think that would have to be in place as part of the MOU to get it started, that the services would need to be in place at the start of the trial?

Mr Forrest : Yes, I think we should definitely have the extra police support services and extra counselling services for the broader community and the individual in place when the card is issued to the community and the restriction on cash, alcohol, pornography et cetera starts, because that is when people will need it most.

Senator MOORE: That would include the alcohol rehab, which is something that people have been talking about a lot—the fact that we have professional alcohol rehabilitation for people who are caught up in this horror.

Mr Forrest : I completely agree.

Senator MOORE: I have only one other question, and then I will give it over to Senator Siewert, who will talk about other things we need to know. Regarding the technical aspects of it—and we will be asking the department about this—a lot has been made about the fact that this is different to the BasicsCard. I know that Senator Siewert will go into that as well. But just the technical stuff about how the card will work—will it be the same as a MasterCard and all that stuff?—which you talked about in your review, and I have read that, are you aware of how far down the track the arrangements are with the department to make all that stuff work?

Mr Forrest : Yes, I am. I did go straight to the chief executives of the four major banks before including the card as a cornerstone of the Creating Parity review and was assured by them that the technology was available. They knew that there would be some work involved on their side, which fortunately we have now gone through, and now we have a situation where the technology can be applied. We have applied it within our own company, at Fortescue, to ensure that improper practices with the large amounts of capital with which we empower our own people through credit and debit cards have some elements of control. I have seen it work very well there, and I am absolutely assured and believe that the technology is quite common now to restrict the consumption of alcohol and, through the restriction on cash, the consumption of drugs. It will be a mainstream bank-issued debit and credit card, which is, of course, entirely different to the clunky, non-financial-services-orientated BasicsCard.

Senator MOORE: The committee does not yet have information on that. We will be asking the department about it, because they should have it. I just wanted to get your answer first.

Senator SIEWERT: Mr Forrest, is it your understanding then that people would have to use one of the big four banks?

Mr Forrest : No, it will be issued like a MasterCard or Visa card, which is able to be utilised at any one of the major banks, but it will be an agglomeration of those banking services, exactly like you would have in your purse.

Senator SIEWERT: I choose which bank I want to use.

Mr Forrest : That is excellent.

Senator SIEWERT: So is somebody able to choose which bank they want to have their bank account with? How do you see that operating?

Mr Forrest : It will come down to the issuer of the card, who will obviously choose the most efficient organisation. I would not be trying to apply a restriction on the card that they can only use one bank or a preferred bank. It would be issued through a coordinator such as a MasterCard or a Visa card.

Senator SIEWERT: It is really unclear how it is going to work, in that case. If I am subject to this measure, it is unclear to me how that will operate in terms of the financial institutions—whether I can choose where I want to keep my money, whether it is the same bank where I am holding my other 20 per cent and how the two accounts will work together.

Mr Forrest : I do not see this as an important technical detail. What we are talking about is assisting vulnerable Australians to restrict their alcohol and drug intake, but, if it is so important to you that we should say, 'For that 80 per cent they should bank with the ANZ or Westpac or Bankwest'—

Senator SIEWERT: I am talking about choice.

Mr Forrest : Sorry, Senator, can I finish please? I do not see the restriction there.

Senator SIEWERT: You are misinterpreting what I said. I am trying to understand how it is going to work and we are not just talking here about people who are abusing alcohol and drugs. We are talking about all of the people who are on a working age payment in these towns. I am sure you are not saying that all of these people are abusing drugs and alcohol. There are a lot of people who are currently doing the right thing and are going to have to change the way they do things. We heard from some of those people this morning, who are extremely concerned and have not been consulted or told about what has been going on. I am trying to get to the bottom of and look at how this is going to work. You say it is going to work differently to the BasicsCard; I understand that. I want to know how it is going to work differently. Then, in reality, we are still controlling the way someone spends their money in that they cannot go and buy alcohol and gamble with it. So it is still the same principle as income management.

Mr Forrest : I suppose I was really surprised at the question—that we would dive down into that detail. I do not know why you would do that when I have already assured you that, unlike the BasicsCard, this is a mainstream banking service not issued by Centrelink. It is a mainstream banking service. The agglomerater of the card—be it MasterCard, Visa card or whoever else—uses all four banks and other banking institutions. I do not see why it would operate any differently and I am confused by your question when I have already assured the inquiry that it will operate exactly the same as the mainstream debit or credit card that you have in your wallet. Wherever that goes, you just happen to have a debit card. So if it is a Visa from Bankwest or a Visa from the Commonwealth—

Senator SIEWERT: One of the reasons I am asking is that there has been a lot of trouble over the years with the BasicsCard. In fact, the last evidence we got to the Senate estimates inquiry was that there were, I think, close to two million phone calls over the period of about seven months with people trying to find out about the balance, for example, on their BasicsCard. These are people in community, and that is obviously a great deal of hassle that they have had with the BasicsCard. So what I am trying to find out is what the mechanisms are, how this is going to operate, whether people are going to have to be ringing up to find their balances and things like that, and how they are going do it under this new system when they are actually going to have two accounts.

Mr Forrest : Are you fully aware how your own debit or credit cards operate?

Senator SIEWERT: Yes.

Mr Forrest : So stop comparing it to the BasicsCard. You have not had a BasicsCard. If you had a BasicsCard you would know how clunky it is, how difficult it is to get those balances, how you cannot use it anywhere, how you cannot attach it to the bank of your choice.

Senator SIEWERT: That is what I am trying to find out.

Mr Forrest : It is just like your own debit card. It operates, as I have said under oath to this inquiry, exactly like a normal debit or credit card you have in your wallet. I do not understand you zeroing in on this when I have been absolutely clear. It operates exactly like a normal mainstream financial system card which you have in your purse.

Senator SIEWERT: That is why I asked you. So I am going to have to go to one of the four banks. You have said that now a number of times.

Mr Forrest : No; you do not have to go. You may go to a financial institution. You may choose someone else other than the big four banks, just like you can with a debit card or a credit card.

Senator SIEWERT: Okay. I am not going to bother pursuing that anymore. I want to go to—

Mr Forrest : I just want to make sure that you are very clear. If you are fully aware—

Senator SIEWERT: No, I am not; quite frankly.

Mr Forrest : I cannot give you debit and credit card lessons on this. If you know how they operate, then this will operate exactly the same.

Senator SIEWERT: So I can choose whichever financial institution I want to have that money put into? That is what I was asking.

Mr Forrest : Can you do that now?

Senator SIEWERT: Yes. You have been talking about the four key banks.

Mr Forrest : You are diving off into a distraction. It operates, as I have said, exactly like a normal mainstream debit or credit card that you have. I would like to get back to what the card is about. It is a mainstream facility, issued by the banking system; nothing like the BasicsCard.

Senator SIEWERT: I want to go back to the issue around income management, quarantining someone's payments and the issue around supports. The Northern Territory evaluation—it was not quite eight years ago—shows that income management has not worked. It says, quite clearly, that it has not delivered on the key objectives and, in fact, talks about entrenchment of dependency. When you did your evaluation, did you look at the delivery of services—if we were delivering all the services that you were just talking to Senator Moore about—to the extent necessary to close the gap, in the absence of income management or quarantining somebody's income?

Mr Forrest : Of course. Anyone who compares this card—a normal mainstream banking card—to the BasicsCard clearly has not done the work.

Senator SIEWERT: Sorry. Please do not accuse me of not having done the work!

CHAIR: Senator Siewert!

Senator SIEWERT: You have already—

CHAIR: Senator Siewert, allow the witness to finish.

Senator SIEWERT: No, I will not be accused of not having done the work.

CHAIR: You can respond once the witness has finished. I will allow Mr Forrest to respond. If you want to put another question to him or respond to something he says, you will be welcome to do so. Mr Forrest.

Mr Forrest : In your question you made a number of statements clearly comparing the BasicsCard to this card.

Senator SIEWERT: No, I am not comparing—sorry.

CHAIR: Senator Siewert!

Mr Forrest : I am not going to accept any of the evidence which I have spoken out against—

Senator SIEWERT: Income management is not the BasicsCard.

Mr Forrest : excuse me, Senator!—and made your points in the review, which you may or may have not read. If you have read it, you would see me making exactly your points. That is why we moved away from anything which resembles the BasicsCard. To go further to your question, it is incredibly hard, if not impossible, to train someone or employ someone in any degree of safety or sustainability if they suffer from drug and alcohol addiction. In order to get people with the self-sustainability, which you take for granted, onto the road—

Senator SIEWERT: No, I do not.

Mr Forrest : and the life which you live, we need to help them through the drug and alcohol addictions. That is where we start. We start to get people so they are training-ready. When you start on that journey of self-sustainability—to get someone so they can stand on their own two feet, so they are not reliant on our welfare, so they can earn their own income—we need to get them off drugs and alcohol. That is where we started. We did not do it through the BasicsCard, which has failed. I will resist any comparisons you would like to make to the BasicsCard because this is not it.

Senator SIEWERT: Mr Forrest, I clearly said 'income management', not 'the BasicsCard'. Income management is not the BasicsCard. The evaluation of income management is not just the BasicsCard.

Mr Forrest : You confuse the two. You happily confuse the two.

Senator SIEWERT: No. I am not going to keep arguing with you because I clearly said 'income management'. The evaluation was across income management. I agree with you in terms of needing to address substance abuse. We may disagree about how we do that, but I agree with you. My question was—whether you are doing it through this card or income management—did you look at if the services were provided, and I think we could agree that the services that have been provided to people that are suffering from alcohol abuse and drug abuse and gambling have not been sufficient to help them. Can we agree on that?

Mr Forrest : No. You need to come with me to Ceduna or Fitzroy Crossing or other places. You will see these empty service providers where people walk past them on their way to the pub or do not even go near them because the drug dealer is on their doorstep. Until we can create an incentive for these poor people to go to these services then they are not going to attend. It is theoretical. You can say whatever you like in Canberra, but unless you go to those communities and you see these empty service providers, because people are not interested in going—they walk past them to the pub—then you may not agree with the practical experience that people need help. If we are to deny them that help then I think we would suffer paternalism on a great degree.

Senator SIEWERT: I am not trying to put words in your mouth, but I asked you if you think there has been enough service provision to support people with the wraparound services that you have just been talking to Senator Moore about.

Mr Forrest : I think everyone's intent here has been wonderful, but the communities have had great difficulties responding. We need to help the communities to respond.

Senator MOORE: We all agree on that, Mr Forrest.

Senator SIEWERT: Have you seen a community where there have been enough resources provided to help people overcome drug and alcohol addiction but they have not had any success? Do I understand correctly what you have been saying?

Mr Forrest : Yes, they have not had the customers. You can walk into Roebourne right now and there are some 39 different services spending taxpayers' money, all well intentioned and doing very little to nothing. The gambling rate is incredibly high, non-attendance at school is incredibly high and the suicide rate is incredibly high. The despondency of the community is obvious and it is at the hands of drugs, alcohol and gambling, Senator.

Senator SIEWERT: Can I go back to this issue of income management and looking at the evaluations of income management? Is it your contention that income managements fail just because of the BasicsCard?

Mr Forrest : I am not going to be drawn into all aspects of income management. I think people need to be helped through drug and alcohol addiction and gambling addictions. I know from friends, Indigenous and non-Indigenous, whom I have lost, that they did not have that help. I would like to ensure, as I said in my opening statement, that when communities are encouraged to come off drugs and alcohol all the assistance they need is available to them.

Senator SIEWERT: So you do not want to discuss whether or not income management has been effective in doing that?

Mr Forrest : No, I would like to discuss the Healthy Welfare Card and the fact that you can buy anything you like, apart from drugs and alcohol, with that 80 per cent.

Senator SIEWERT: I know you said to Senator Moore that you would prefer a completely cashless approach. But a lot of evidence has been presented to the committee about needs to access cash so that you can enable access to transport, rent when you are sharing, markets, second-hand furniture. A range of matters have been put to us. Do you not see that cash is part of that economy and that putting 80 per cent on the card therefore does restrict what you can buy?

Mr Forrest : I have not noticed in any of the examples you used that that cannot be paid with a normal debit or credit card, so no, I would not.

Senator SIEWERT: You cannot at markets.

Mr Forrest : In terms of remote communities, it will take a short period of adjustment only. If you are saying that we should apply a new technology to an existing environment with no transition at all, which is of course highly theoretical, then there would be issues, because vendors expect cash, and if they are only set up for cash then that is all they will take. But of they begin to lose business to the vendor next door who is set up to take a card, they will quickly be able to take cards as well. That is how the marketplace operates.

Senator SIEWERT: Not if you are buying second-hand furniture it does not—if you are buying second-hand from garage sales et cetera, which is what a lot of people on income support do. They buy second-hand furniture from newspapers et cetera. I am not going to have an EFTPOS, am I, if I am doing that? I buy a second-hand vehicle—

Mr Forrest : So you would buy a second-hand vehicle with cash?

Senator SIEWERT: Some people do, yes. It is certainly what people have told me.

Mr Forrest : So, we would seek then to deny this technology to entire communities because of that extreme example?

Senator SIEWERT: There are a lot of people who buy second-hand furniture if they are on income support or on a low income.

Mr Forrest : Okay, look: I bought a lot of second-hand furniture and attended garage sales, so I know exactly what you are saying. In today's day and age, you can do it with a debit and credit card; 10 years ago or 20 years ago you absolutely could not. There are still cash elements here, but what we are trying to do, instead of choosing extreme examples, is to help people through something which maybe will not give them a second-hand bed but will give them a new life. And that is what we are about.

Senator SIEWERT: Sorry, but the issue here—and I absolutely understand it—you are applying it across the whole of a community. You want to stretch it across Australia, because this is a trial. Presumably, therefore, you want to apply it across Australia. You are therefore applying it to every person who is on a working-age payment. So you will deny that opportunity to everybody.

Mr Forrest : I have been to these communities and I would like, when I return from the Ukraine, to take you there as well, and let's speak to them.

Senator SIEWERT: I have been to many.

Mr Forrest : We are only talking about Ceduna or Fitzroy Crossing. I have been there in the last year. I would love to take you back to either of those communities. You may have been there in the last year as well, for all I know, but—

Senator SIEWERT: In fact, the last couple of months.

Mr Forrest : if you have been, you would have heard those communities say: 'Nothing else has worked. This is a new technology; would you please allow the trial here?' And for us to deny that to them when they are not saying that they do not want the trial because they want to buy a second-hand bed—they are saying they want the trial because they want their children to go to school and to survive; they want to have sustainable lives, to put the drug dealers out of work and put their kids into work.

Senator SIEWERT: You did not answer my question.

CHAIR: Senator, we are—

Mr Forrest : I think I did exactly.

Senator SIEWERT: No, you did not.

CHAIR: Regardless—

Mr Forrest : Well, tell us the question and I will make sure I meet your satisfaction.

CHAIR: Mr Forrest, we have gone overtime. We have other witnesses waiting. I do appreciate your making yourself available from overseas. Thank you very much for your evidence. We are now going to move to our next witnesses, so thank you for being with us today.

Mr Forrest : Thank you very much. I have deeply appreciated your interest.