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Community Affairs Legislation Committee
07/08/2018

FEERICK, Mr Peter, Private capacity

MASON, Mrs Annette, NILS Coordinator, Bundaberg & District Neighbourhood Centre

SILK, Miss Crystal, Private capacity

WEBB, Mrs Patti, Retired NILS Coordinator, Bundaberg & District Neighbourhood Centre

WILKES, Miss Kathryn, Main Administrator, Say No to the Cashless Welfare Card Australia

Evidence was taken via teleconference—

Committee met at 09:48

CHAIR ( Senator Brockman ): I declare open this public hearing and welcome everyone today. This is the first public hearing of the committee's inquiry into the Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018. I thank everyone who has made a submission to this inquiry. This is a public hearing and a Hansard transcript of the proceedings is being made. The audio and video of this public hearing is also being broadcast via the internet. Before the committee starts taking evidence, I remind all present here today that in giving evidence to the committee witnesses are protected by parliamentary privilege. It is unlawful for anyone to threaten with or disadvantage a witness on account of evidence given to the committee, and such action may be treated by the Senate as a contempt. It is also a contempt to give false or misleading evidence to the committee. The committee prefers all evidence to be given in public but, under Senate resolutions, witnesses have the right to request to be heard in private session. It is important that witnesses give the committee notice if they intend to give evidence in private. If you are a witness today and intend to request to give evidence in private please speak to the secretariat staff. Throughout today's hearing the committee will be telecommuting via video link. I am advised that this is a first for a Senate committee, so I thank everyone for their patience—we've already seen a few hiccups—as we trial this new approach. Do you have any comments to make on the capacity in which you appear?

Miss Wilkes : I represent also No Cashless Debit Card/Hinkler Region.

Mr Feerik : I am an individual affected by the card.

Miss Silk : I am here to talk on behalf of the people who will be affected by the card as I myself am a Centrelink recipient and will be affected by the card.

CHAIR: Could you please confirm that information in parliamentary privilege and the protection of witnesses and evidence has been provided to you.

Miss Silk : Yes.

Miss Wilkes : Yes.

Mrs Mason : We also have another witness here. I'm the coordinator of NILS program at Bundaberg. NILS is the No Interest Loans Scheme, so this will affect our clients, as well.

CHAIR: I will ask you all to make an opening statement if you wish. However, I will caution you to make your opening statements as brief as possible. We have five senators who wish to ask you questions, so, if we can, keep it very quick. We have a submission from Say No to the Cashless Welfare Card Australia, so we'll start with you, Miss Wilkes, if you would like to make some brief opening remarks, and then we will go to questions.

Miss Wilkes : Thank you. We're still sitting in a situation where there's been basically still no public consultation from the local member, which is coming across as everybody is being ignored now. One of the problems that we've got is the cost. We feel that the money that is going to be given to Indue to run the program should be directed back to on-ground services, to all services—mental health, disability support, drugs, alcohol, gambling, housing, homelessness services, DV shelters et cetera. The government should invest in the community and the people, and not so much in the private company, because I can't see where investing in the private company is going to be beneficial for the community that's going to be stifled by this.

We've got a bit of a query, because under the Social Security Guide to Social Policy Law version 1.241, February 2018, at 8.43 Protection of Payment, it says:

Once a social security payment has been paid into a recipient's bank account it is no longer a social security payment …

However, the problem with the Indue card, and it's a big elephant in the room that seems to be being ignored or dismissed or overlooked is that, subject to legislative instrument, Indue actually circumvents the recipient's rights and entitlements so that the payments never become the recipient's. Indue takes ownership of those funds, leaving the recipient basically a pauper. We've heard from people in Kalgoorlie that are not on the card but their partner is. As a result, they are now cut out of the banking sector in regard to taking a loan or something like that, because the 20 per cent is their only physical income. The Indue money is not considered their income by the bank, so people will not be able to take part in lending practices or banking practices normally, as any other citizen is free to do. Cutting off such a large portion of our population overall would be discriminating, absolutely, if this were to expand across the board. I think it needs to be investigated and looked into. Why should a private company just be given 80 per cent of our social security payments? What's the end game of this? Why isn't the government keeping control of that money?

One of the biggest issues we have in our region is media manipulation and sensationalism. The media attack has been relentless in the last three months There are big, broad headlines in our papers—headlines such as 'Welfare Migrants' as people move from Bundaberg and Hervey Bay and try to get out of the region. We had the chamber of commerce in Maryborough bleating about welfare migrants coming to Maryborough. What's the matter? Is social security money no longer valid currency? Isn't it good enough for the shops in Maryborough? It's just the derogatory way it's being used: 'bludgers' and 'crackdown on bludgers'. We are absolutely sick to death of the media stigmatisation of people on social security, whether it be youth allowance, parenting payment, disability—even old age. Even the pensioners are copping it now.

One of the most disgusting things that came out recently was in regard to a little town we have here called Howard. It's only got about 1,078 local people. A certain community leader stood up and basically branded the kids of that whole town as 'welfare kids', which I find extremely offensive, because the stigma that's going to be attached to this card will pass down to the next generation. My attitude is: welfare kids—where are we going with this? I saw a submission that described Aboriginal people as 'coloured' people. This 'other' language is going too far.

In regard to the youth group, they say that kids are coming in hungry. Well, kids come home from school; they come flying through the door and straight to the fringe: 'I'm hungry, Mum.' That's common at three o'clock or 3.30 in the afternoon. I don't know any kid that has not done it. So you've got kids coming out of the school and going to the youth club at three o'clock in the afternoon. Of course they're going to be hungry; they haven't been able to go home and get a snack first, and the youth club doesn't finish till 5 pm. From some of the statements that are being used and the way that went across, that covered not only a front page but another full page and a video to really ram that through. I had people ringing me from Howard who were absolutely disgusted that this person had stood up and spoken on behalf of their community without their consent and branded their whole little town—which is a lovely little town—as some place that's a rotten place and branded their kids as welfare kids. So I did include that in my submission, along with the video.

The message I want to get out there is: our kids are Aussie kids, not welfare kids. I grew up in an inclusive Australia that didn't brand people as such, and we've already seen the video evidence of how people are already being treated with this card. It is there from the public meetings in Kalgoorlie, and we've known from Ceduna and Kununurra that it's absolutely degrading. It shouldn't go ahead; that's my opinion. That's that. Thank you.

CHAIR: Thank you. Did anyone else have some brief opening remarks?

Miss Silk : Yes. I have many reasons why I'm against the trial of the cashless card for my region and for myself, as I am 31 and fall within the trigger payment. One of the reasons is that I will not be able to pay my car finance with the 80 per cent that's quarantined on the CDC, as mine, like many other car finance accounts, only accepts the minimum required payment via direct debit, and Indue, the company looking after the CDC, apparently do not accept any direct debit, as per their terms and conditions. In a region where used car lots advertise finance for Centrelink recipients, I believe I won't be the only one with this issue. As a person who budgets every dollar I spend, I, as do many others in the community, need cash to make ends meet so I can shop online on Gumtree or Facebook, on buy or swap sell sites, at garage sales on the weekend, at markets, at cash fares and at family events. And let's not forget those roadside huts that farmers put their fresh fruit and veg in for a fraction of the supermarket prices. We still have many of those huts and stalls on the sides of our roads in our region where you pay the correct cash money into a locked box or tin that a farmer will collect at the end of the day and you take the fresh produce that you bought. It works on trust, cash and community support. If you take away this 80 per cent portion of the cash for roughly 6,700 people in Hinkler, what might happen to our farmers, our market stallholders or people in an emergency who just can't afford a brand new fridge or washing machine and do not have access to enough of their payment to buy a second-hand one for cash? I have heard many news reports and read papers from CDC areas where the card is declined even for supermarket purchases when there is money in their account. It makes feel that we're some sorts of test lab rats. It's based on a system of 'What if it works,' when it can't be proven after a few years of trials in current trial sites. Also, how is the card going to help create jobs when a lady who worked for a government job agency in our region stated on the news that there are not enough jobs? For one entry-level job, for example, that she had, there were around 400 applications.

Lastly, the children have many school fundraisers that use cash. There are tuck shops and sports events, and parents need to buy second-hand uniforms or second-hand school supplies to make ends meet and provide everything and anything a child may require. Kids in our area are already being labelled 'welfare kids' by higher community members by going to breakfast club at school or by simply saying, 'I'm hungry,' after an active day at school, which I did as a child, even though I was well fed. We are being branded and shamed as bad parents who are dole bludgers and do not feed our children. Those statements are far from the truth for the huge majority of parents on social security. What about the teens fresh out of year 12, with the world in the palm of their hands and the belief that they can achieve anything they set their mind to? But they just can't get straight into a job or a university or a trade or an apprenticeship and need that assistance to help while they achieve that. Why would you want to give them a card that comes with the label 'dole bludger' or 'welfare abuser', as stated in our media? I believe it will tarnish their mental health in an area that needs more mental health services. Our children are our future: doctors, lawyers, paramedics and even our future politicians. They need a boost up, not be brought down by income management and the CDC. Thank you.

CHAIR: Thank you.

Mr Feerick : I partly agree. It was what I was going to say. I know that time is short. As I indicated in my submission, I'm somebody in the target group. I'm under 36 years of age and I'm currently on a Centrelink payment. However, I don't have any of the problem issues that this card is said to address. I don't smoke, I don't gamble, I don't drink alcohol and I don't take illicit drugs; I don't take any drugs at all. Our local federal member, Keith Pitt, didn't make any attempt to contact me or anyone else I know in the target group to find out what our views are on the card, as people who are directly affected. I live in a multigenerational household. My grandfather received a letter from Keith which explained that he would not be put on the card as he's an age pensioner. There was a questionnaire which asked whether he was for or against the card. However, I didn't receive this. Instead, both I and my mother received a joint letter which spoke about the card in glowing terms, and we only had the option of expressing support for the card via an online petition. How are we expected to make an informed decision on a policy such as this, based merely on information provided in one letter by somebody who is in favour of the card? Again, why wasn't I given the opportunity to say that I do not support it? Why was my mother not provided that opportunity? A copy of the letter was actually provided at the previous inquiry and can be provided again if needed as evidence.

I am studying law through the local university. I'm nearly finished now. As part of constitutional law, I learnt about the basic tenants of representational government, such as accountability, transparency and responsibility. Why is it that individuals acting on behalf of the executive and the legislative arms of the government are not ensuring that everything is above board in relation to the cashless debit card? Why has there not been a single public consultation held by a local federal representative where members of the public, as well as service providers and community leaders, can discuss in an open and robust fashion issues that affect our region and determine, as a community, how to deal with these issues? Why are we not working from a position of knowledge rather than merely saying: 'This seems like a good idea. We just need to do something. It doesn't matter if it works or it doesn't work. We'll find that out later'? I believe Keith Pitt actually said that in parliament at one point: 'We will try this and we'll find out later if this works.'

There are also a lot of preconceptions and misconceptions from people who are in favour of the card. I've seen this both in talking with members of the public and in reading a lot of the submissions to this inquiry and the prior one last year. A lot of people will say, 'This is a good idea; it'll feed starving children,' or, 'It'll fix obesity,' or, 'It'll fix the people who waste their money on sugared drinks or smoke or have tattoos.' But the thing is that it's not going to address any of those things. It has been introduced saying that it'll fix intergenerational welfare dependence, fix gambling addictions and disrupt illegal alcohol sales, but how does it do any of these by taking away people's agency and their ability to use their money to the best of their abilities? One positive outcome does not outweigh five negatives. It's going to make people's lives a lot harder. Yes, it may work for one, two or three people, but everyone else in the target group is going to be impacted by this.

I'll just finish off by saying that the end does not justify the means. This has been proven time and again through history, and it's going to happen again now.

CHAIR: Thank you. Mrs Mason, do you have any opening comment?

Mrs Mason : I don't know much about the cashless debit card, but I do have some questions as the coordinator of the NILS program. We rely on people's bank statements to verify their spending habits. We're just wondering if Indue will provide statements to us to show what the spending patterns of our clients are for the NILS application process. Being out of the banking system, I think it's necessary to have that information from somewhere else. I can see it as being very discriminatory, identifying the person as a benefit receiver. I also have a question about the 20 per cent. Is that 20 per cent cash of their total benefit, or is that after Centrepay deductions come out of their amounts? Thank you.

CHAIR: Thank you. We'll move on to questions now, because we are very short of time.

Senator PRATT: Thank you for giving evidence this morning. It's very helpful to have such direct personal views about the card. I'm particularly interested in some of the comments you've made about direct debit and NILS loans and the need for cash within the local community. As you understand it, you are not allowed to use the cashless debit card for direct debits. If it's 20 per cent of the income that's left, you're suggesting that people who have personal loans for things like cars or anything else would not be able to afford the repayments on that out of the remaining cash that's allowed to go through to the bank account?

Miss Silk : I have been in contact with places like Centrepay to find out about direct debits when it comes to my car finance and how to make payments, and I have been in contact with Indue themselves. My contract, like most people's contracts with finance companies, makes sure that the minimum required payment has to come from a bank account to ensure that they will get that money and to ensure that they can have that. If I use my 20 per cent, it will take up all my 20 per cent to pay my car finance. That means I won't be able to buy second-hand uniforms or I won't be able to go to the markets. I have a very strict budget. I have a certain amount on market fruit and veg, I have a certain amount that I have to put aside for bills and things like that, and if this takes out of that cash component, I'm then going to be having to go to supermarkets where, yes, I'll be paying more, which means I have less of a budget, which means, potentially, I could be taking that out of my child's mouth. Indue has stated that currently they do not accept any direct debit. Either they will pay the bill for you—which my finance company does not accept—or you have to take it out of your 20 per cent cash portion, which also takes it out of the pockets of your children.

Senator PRATT: Thank you for taking me through the detail of that. I know it seems obvious that with only a 20 per cent cash component those things are impossible, but it's very important to get it on the record. Frankly, we haven't had many people that have been prepared to speak directly about how this impacts on their household's budget. As you can understand, and as you've all highlighted, that's because of the stigma attached to being forced onto this card.

I'd like to ask about the NILS loans and about being able to see what people's spending habits are. I'm not in favour of the card, but I'm just trying to go through it in terms of what the government and others are likely to say. Are they simply going to assume that all spending that takes place on the cashless welfare card is 'good' spending? And why would you not be able to assume that in making an assessment?

Mrs Mason : I will get my former coordinator to answer that question.

Mrs Webb : I've just resigned as the coordinator of the NILS program. When we look at whether or not a person can afford a NILS loan—which is only a matter of $1,500—for essential furniture items like fridges, washing machines, beds et cetera, we look at their spending habits. Currently what we do is go through their bank statements to see where their budget sits, and whether or not they're able to afford to be able to repay the payment, which comes out as Centrepay. We also give the person a copy of the budget. Our concern with the Indue card is whether or not we are able to get a list of transactions, or a statement, which will replace that information that is previously being used to give us a correct idea of what the person's budget is and whether or not they can afford to go through the loan and purchase the item.

Another concern is whether or not Centrepay is going to be one of the recurring payments that is mentioned on the fact sheets for Indue, which we can take into account for the actual granting—or not—of the loan.

Senator SIEWERT: Could you clarify that: do you mean whether it will be on the list of payments that were previously eligible for Centrepay—whether they'll be eligible under the Indue process? Is that what you mean?

Mrs Webb : Yes. I've actually got a fact sheet that I downloaded this morning. It says, 'Where can the cashless debit card be used? It can be used in any store that accepts EFTPOS nationwide to shop at an approved online store. It can be used to pay bills and make recurring payments such as rent and mortgage.' They've highlighted rent and mortgage, but what about the other loan repayments and, as the young lass said before, what about car payments? There is a concern here also that Indue won't allow any third party on a loan process for any arrangements.

CHAIR: Credit arrangements?

Mrs Webb : Yes, credit arrangements.

CHAIR: We are running significantly behind time. I understand there were technical problems. Senator Bartlett, do you have any questions?

Senator BARTLETT: No, in view of the time, I'll let things keep on.

CHAIR: Thank you. Senator Lines.

Senator LINES: A number of you commented on the fact that your local federal member hadn't consulted with the community. Are you aware or can you tell us what consultations have occurred? Have government bureaucrats been to the town? What's been the consultation?

Miss Wilkes : The only public consultation was done last year when DSS came, and that wasn't a consultation. That ended up being 50 very angry people in Hervey Bay who couldn't get any questions answered and were told, basically, 'You'll just have to learn to live a different way.' When people questioned Indue's cashless debit card terms and conditions, they were shut down.

Senator LINES: So you're aware that DSS came once to Hervey Bay?

Miss Wilkes : Yes, and they came once to Bundaberg.

Mr Feerick : The DSS, as part of their submission, will say that there have been at least 120—I lost track what the actual number was—consultations. The thing is that these are all individual consultations—one-on-one sessions with either a federal member or with representatives from the Department of Social Services. The sessions they held that were public were two information sessions. This is how they were marketed. They marketed as information sessions, but these were sessions run by DSS representatives telling people, 'This is how the card will work.' I believe there was a third session held in Childers, but that was only open to Childers or Isis residents, and I think that was actually predominantly held to inform members of business and the chamber of commerce. There was also a fee of $20 to even enter. So I don't think anyone in their right mind could ever say that that was actually a public consultation.

Senator LINES: Are you saying you had to pay $20 to go?

Mr Feerick : There was a $20 admission or a $20 breakfast attached to it.

Senator LINES: So those three information sessions were at Bundaberg, Hervey Bay and Childers.

Miss Wilkes : The Childers one was a chamber of commerce meeting. It was at 6 am or 5 in the morning, which is not a normal time for members of the public to attend anyway. The Bundaberg one was timed bang-on for school pick-up, so you had the situation where parents couldn't attend because they were picking their kids up from school. The one in Hervey Bay was over a lunchtime session, I believe.

Mr Feerick : At 11ish.

Senator LINES: And that had about 50 people?

Miss Wilkes : The Hervey Bay one had about 50 people in it. They divided it up into three little table groups and it was like a big sell. It was like a marketing thing. If you questioned anything, you couldn't get any answers; you were told, 'This is how it's going to be.'

Senator LINES: And that was the flavour of the other ones as well—it was an information session and very hard to get answers?

Mr Feerick : Yes, that was definitely the case for Bundaberg. It was the same format. Everyone was split up and you had three groups. When people spoke afterwards about what each group had spoken about, there was actually conflicting information, so there was a lot of confusion at the end of the day as to certain points about the cashless card.

Senator LINES: Because we're short on time, would you mind sending the committee a very short email outlining that consultation as you just described it?

Mr Feerick : Yes, that would be fine.

Senator SIEWERT: I'll be very quick because I know we're running out of time. Ms Silk, you gave a very articulate explanation of the types of circumstances where you use cash. Could you give us a quick rundown, and maybe take this on notice, if you've worked out what percentage of your income you spend on, for example, being able to access school uniforms, school books and all those sorts of things? What percentage of your income would you spend in that way in order to maximise your budget?

Ms Silk : If we do it fortnightly, which is how I do my budget, I've got my two weeks rent and my car finance and I put another $50 away—which I save throughout the year—for registration and emergency electricity bills that just pop up. I'd use a little bit in the supermarket but the rest would be cash. So I would say almost $200 a fortnight on fresh fruit and vegetables and then you've got to have that little bit of savings in case a fridge, a microwave or a washing machine breaks down. I have kids. I don't have expendable things. Everything is for them. So, my cash component goes to the markets where they like to go, because every so often a farmer might give you a free apple or a free banana with your purchases. So a large portion goes to them, because I believe it needs to go to our farmers and into our community to help make our economy here in Bundaberg survive.

Senator SIEWERT: So, in other words, being able to access cash for the way you stretch out your budget is really important?

Ms Silk : Absolutely. I budget down to every dollar. I make sure I have a weekly plan, I have a fortnightly plan, I have a monthly plan, and then I have a yearly plan for my bills. Most Centrelink recipients, when they have such a little cash amount or a little payment, are the best budgeters in the world because not only do we need to be able to survive weekly or monthly but we also need to budget for yearly bills, especially when we have things like cars, rent and bigger bills—and electricity just keeps going up. So we have to budget.

CHAIR: Thank you all very much for your participation today. For those who want to get further information to the committee, we will need that information by this coming Thursday—Thursday, 9 August.