Title Community Affairs Legislation Committee—Senate Standing—Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 [Provisions]—Report, dated November 2020
Source Senate
Date 30-11-2020
Parliament No. 46
Tabled in Senate 30-11-2020
Parliamentary Paper Year 2020
Parliamentary Paper No. 497
Paper Type Committee Document
Disallowable No
Journals Page No. 2620
House of Reps DPL No. 764
System Id publications/tabledpapers/1d0ab758-7b76-4108-88bd-a9a6f71a4844


Community Affairs Legislation Committee—Senate Standing—Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 [Provisions]—Report, dated November 2020

November 2020

The Senate

Community Affairs Legislation Committee

Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 [Provisions]

© Commonwealth of Australia 2020

ISBN 978-1-76093-128-5 (Printed Version)

ISBN 978-1-76093-128-5 (HTML Version)

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivs 4.0 International License.

The details of this licence are available on the Creative Commons website: https://creativecommons.org/licenses/by-nc-nd/4.0/.

Printed by the Senate Printing Unit, Parliament House, Canberra

iii

Committee Members

Chair Senator Wendy Askew LP, TAS

Deputy Chair Senator Rachel Siewert AG, WA

Members Senator Malarndirri McCarthy ALP, NT

Senator Andrew McLachlan CSC LP, SA

Senator Helen Polley ALP, TAS

Senator Dean Smith LP, WA

Participating Members Senator Patrick Dodson ALP, WA

Senator Sue Lines ALP, WA

Senator Matt O'Sullivan LP, WA

Senator Rex Patrick IND, SA

Secretariat Apolline Kohen, Acting Committee Secretary Sarah McFadden, Principal Research Officer Carol Stewart, Administrative Officer

PO Box 6100 Parliament House Canberra ACT 2600 Phone: 02 6277 3515 Fax: 02 6277 5829 E-mail: community.affairs.sen@aph.gov.au Internet: www.aph.gov.au/senate_ca

v

Table of Contents

Committee Members ........................................................................................................................ iii

Abbreviations ................................................................................................................................... vii

List of Recommendations ................................................................................................................. ix

Chapter 1—Introduction .................................................................................................................... 1

Purpose of the bill ................................................................................................................................ 1

Background ........................................................................................................................................... 2

Cashless debit card ................................................................................................................... 2

Transition from BasicsCard to CDC ....................................................................................... 2

Evaluation and reports ............................................................................................................. 3

Previous inquiries ..................................................................................................................... 4

Key provisions of the bill .................................................................................................................... 5

Continuing the CDC as an ongoing measure ....................................................................... 5

Transition from IM to CDC in the NT and Cape York region, Queensland .................... 5

Extension of IM in the Cape York area .................................................................................. 5

Sharing information with community bodies ...................................................................... 6

Remaining a voluntary participant after moving out of a program area ......................... 6

Allowing reviews of wellbeing exemption determinations ............................................... 6

Enabling determinations for exit criteria ............................................................................... 6

Reviewing exit determinations ............................................................................................... 7

Enabling the Secretary to issue notices .................................................................................. 7

Improving the evaluation process .......................................................................................... 7

Financial implications .......................................................................................................................... 7

Legislative scrutiny .............................................................................................................................. 8

Senate Standing Committee for the Scrutiny of Delegated Legislation ............................ 8

Parliamentary Joint Committee on Human Rights .............................................................. 8

Senate Standing Committee for the Scrutiny of Bills ........................................................... 9

Conduct of inquiry ............................................................................................................................... 9

Acknowledgement ............................................................................................................................. 10

Note on references ............................................................................................................................. 10

Chapter 2—Key issues...................................................................................................................... 11

vi

Harm reduction .................................................................................................................................. 11

Safer communities .................................................................................................................. 12

Child welfare ........................................................................................................................... 13

Other positive outcomes ........................................................................................................ 13

Financial literacy ..................................................................................................................... 15

Issues with card functionality .......................................................................................................... 16

Technology enhancements .................................................................................................... 16

Transition from the IM BasicsCard to CDC ........................................................................ 20

Monitoring and evaluation ............................................................................................................... 21

Evaluations to date ................................................................................................................. 21

Ongoing monitoring ............................................................................................................... 23

Impacts on IM participants in transitioning to CDC .................................................................... 23

Ministerial discretion.............................................................................................................. 24

Tobacco ..................................................................................................................................... 24

Consultation and support to facilitate transition from IM to CDC ................................. 25

Other key concerns raised by submitters ....................................................................................... 26

Limited opportunity for scrutiny ......................................................................................... 26

Establishing the CDC as an ongoing program ................................................................... 26

Human rights .......................................................................................................................... 27

Wellbeing exemption and exit determinations................................................................... 28

Other matters raised by submitters and witnesses ............................................................ 29

Committee view ................................................................................................................................. 29

Technological enhancements ................................................................................................ 30

CDC as an ongoing program ................................................................................................ 30

Dissenting Report by Labor Senators ........................................................................................... 31

Dissenting Report by the Australian Greens .............................................................................. 37

Appendix 1—Submissions and additional information ........................................................... 45

Appendix 2—Public hearings ......................................................................................................... 51

vii

Abbreviations

Act Social Security (Administration) Act 1999

ALPA Arnhem Land Progress Aboriginal Corporation ANAO Australian National Audit Office

APO NT Aboriginal Peak Organisations Northern Territory bill Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 CDC Cashless Debit Card

committee Senate Community Affairs Legislation Committee delegated legislation committee Senate Standing Committee for the Scrutiny of Delegated

Legislation

DSS Department of Social Services

EM explanatory memorandum

IM Income Management

Minister Minister for Families and Social Services NT Northern Territory

PJCHR Parliamentary Joint Committee on Human Rights PLB Product Level Blocking

scrutiny of bills committee Senate Standing Committee for the Scrutiny of Bills Secretary Secretary of the Department of Social Services statement of compatibility

statement of compatibility with human rights

ix

List of Recommendations

Recommendation 1

2.107 The committee recommends that the bill be passed.

1

Chapter 1 Introduction

Purpose of the bill 1.1 The Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 (bill) was introduced into the House of Representatives on 8 October 2020.1

1.2 The primary purpose of the bill is to transition Income Management (IM) participants in the Northern Territory (NT) and Cape York region onto the Cashless Debit Card (CDC) and to allow the CDC to continue as an ongoing measure in all existing sites as well as the NT and Cape York region following transition from IM. The bill also makes a number of minor changes to program administration to improve outcomes for individuals and families in those communities.2

1.3 Specifically, the bill seeks to amend the Social Security (Administration) Act 1999 (Act) to:

 remove trial parameters to establish the CDC as an ongoing program in all existing sites;  transition IM in the NT and the Cape York region to the CDC;  remove the exclusion to allow people in the Bundaberg and Hervey Bay

program area to voluntarily participate in the CDC program;  allow a voluntary participant to continue to volunteer for the CDC even if they no longer reside in a program area;  enable the Secretary to advise a community body when a person has exited

the CDC program;  allow the Minister to determine decision-making principles for the purposes of determining whether a person can demonstrate reasonable and responsible management of the person’s affairs (including financial affairs);  enable the Secretary to review a wellbeing exemption or exit determination

in certain circumstances and revoke the determination as a result of such review;  enable the Secretary to issue a notice informing the person that they are a CDC program participant. The Secretary may also issue a notice revoking

that notice;  improve the workability of the evaluation process; and

1 House of Representatives Votes and Proceedings, No. 73, 8 October 2020, p. 1253.

2 Explanatory memorandum, pp. 3 and 28.

2

 extend the sunset date for IM in Cape York, Queensland from 30 June 2020 to 31 December 2021.3

Background 1.4 The Australian Government currently has two programs, IM and CDC, to deliver its commitment of maintaining a strong welfare system while reducing social harm in communities with high levels of welfare dependency, and

supporting people, families and communities to achieve positive outcomes.4

1.5 As at 25 September 2020 there were 12 114 CDC participants and 25 572 IM participants in the Northern Territory and Cape York.5

Cashless debit card 1.6 There are currently four CDC trial sites. The CDC commenced in Ceduna on 15 March 2016, the East Kimberley on 26 April 2016, the Goldfields region on 26 March 2018 and the Bundaberg and Hervey Bay region on 29 January 2019.6

1.7 The objective of the CDC is to limit the amount of welfare payment available as cash with an aim to reduce harm caused by substance abuse and problem gambling. The CDC is also a helpful financial management tool.7

1.8 Under the CDC, 80 percent of a participant’s welfare payment is placed on a Visa debit card provided by Indue Ltd. that operates like a regular bank card, except it cannot be used to withdraw cash and to purchase alcohol, gambling products and open loop gift cards.8

1.9 In March 2020, the Government announced a temporary pause on placing new eligible participants on to the CDC in all existing trial sites due to Services Australia’s workforce constraints relating to the coronavirus pandemic.9

1.10 The four trial sites are currently legislated until 31 December 2020.10

Transition from BasicsCard to CDC 1.11 IM has been operating in communities in the NT and Cape York for more than ten years. IM aims to reduce hardship by directing between 50 and 90 percent

3 Explanatory memorandum, p. 1.

4 Explanatory memorandum, Regulation Impact Statement, p. 1.

5 Department of Social Services, Cashless Debit Card Data Summary October 2020, p. 1 and Department

of Social Services, Income Management Data Summary October 2020, p. 1.

6 Department of Social Services and Services Australia, Submission 26, p. 7.

7 Explanatory memorandum, Regulation Impact Statement, pp. 5–6.

8 Explanatory memorandum, Regulation Impact Statement, p. 5.

9 Senator the Hon. Anne Ruston, Minister for Families and Social Services, ‘Temporary pause on

new Cashless Debit Card trial participants’, Media release, 25 March 2020.

10 Explanatory memorandum, Regulation Impact Statement, p. 6.

3

of a welfare payment to the priority needs of participants and their families. IM is used primarily as a budgeting tool.11

1.12 Under IM, a welfare recipient has the option to access their income managed funds via a BasicsCard which can be used at approved stores and businesses, through the EFTPOS system.12

1.13 BasicsCard merchants are stores or businesses that have applied and been approved to accept the BasicsCard through the EFTPOS system. The BasicsCard is accepted at around 17 000 merchants and cannot be used for online shopping or bank transfers.13

1.14 Participants in Cape York and the NT will retain their existing ratio of quarantined income when they transition from the IM system to the CDC program.14

1.15 The objective of the transition to the CDC for IM participants in the NT and Cape York is to provide the improved technology of the CDC, which enables a range of flexible payment options, greater access to merchants and fewer restrictions on participants.15

Evaluation and reports 1.16 The Commonwealth Government commissioned ORIMA Research to undertake an independent evaluation of the CDC trials in Ceduna and the East Kimberley. The final evaluation report was released on 1 September 2017.16

1.17 On 15 May 2018, the Commonwealth Government announced an independent Second Impact Evaluation to assess the ongoing impact of the CDC in the first three trial sites of Ceduna, the East Kimberley and the Goldfields.17 Conducted by the University of Adelaide, the Second Impact Evaluation has not yet been finalised. However early findings are available in the explanatory memorandum (EM).18

1.18 The Australian National Audit Office undertook an independent performance audit of the CDC trial, the objective of which was to assess the Department of

11 Explanatory memorandum, Regulation Impact Statement, p. 2.

12 Department of Social Services and Services Australia, Submission 26, p. 8.

13 Explanatory memorandum, Regulation Impact Statement, p. 7.

14 Explanatory memorandum, Statement of compatibility with human rights, p. 31.

15 Explanatory memorandum, Regulation Impact Statement, p. 12.

16 The Hon. Alan Tudge MP, Minister for Human Services, ‘Evaluation finds “considerable positive

impact” from cashless debit card trial’, Media release, 1 September 2017.

17 The Hon. Dan Tehan MP, Minister for Social Services, ‘New Cashless Debit Card evaluation

extends to Goldfields’, Media release, 15 May 2018.

18 Explanatory memorandum, Regulation Impact Statement, pp. 28–30 and 60.

4

Social Services’ (DSS) implementation and evaluation of the trial. The Auditor-General presented the report to Parliament on 17 July 2018.19

1.19 The University of Adelaide was also commissioned by DSS to collect baseline data for the CDC trial in the Goldfields and Bundaberg and Hervey Bay regions. The reports were released in February 2019 and May 2020 respectively.20

1.20 The findings of these reports were referenced frequently in submissions made to this inquiry and are discussed, where relevant, in Chapter 2.

Previous inquiries 1.21 The Senate Community Affairs Legislation Committee (committee) has reported on, and consistently supported, legislation relating to the CDC trial and IM in Cape York and other trial sites on several occasions in recent years:

 The Social Security Legislation Amendment (Debit Card Trial) Bill 2015 (report tabled 12 October 2015) established the CDC trial in the East Kimberley and Ceduna.21

 The Social Services Legislation Amendment (Queensland Commission Income Management Regime) Bill 2017 (report tabled on 20 June 2017) extended the Cape York IM program.22

 The Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 (report tabled 6 December 2017) expanded the CDC trial to the Goldfields region.23

 The Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018 (report tabled 14 August 2018) expanded the CDC trial to the Bundaberg and Hervey Bay region.24

 The Social Security (Administration) Amendment (Income Management and Cashless Welfare) Bill 2019 (report tabled 1 April 2019) extended the

19 Australian National Audit Office (ANAO), The Implementation and Performance of the Cashless Debit

Card Trial, Auditor-General Report No. 1, 2018–19, p. 8.

20 Future of Employment and Skills Research Centre, University of Adelaide, Cashless Debit Card

Baseline Data Collection in the Goldfields Region: Qualitative Findings, 21 February 2019 and Future of Employment and Skills Research Centre, University of Adelaide, Cashless Debit Card Baseline Data Collection in the Bundaberg and Hervey Bay Region: Qualitative Findings, 6 May 2020.

21 Community Affairs Legislation Committee, Social Services Legislation Amendment (Debit Card Trial)

Bill 2015 [Provisions], 12 October 2015.

22 Community Affairs Legislation Committee, Social Services Legislation Amendment (Queensland

Commission Income Management Regime) Bill 2017 [Provisions], 20 June 2017.

23 Community Affairs Legislation Committee, Social Services Legislation Amendment (Cashless Debit

Card) Bill 2017 [Provisions], 6 December 2017.

24 Community Affairs Legislation Committee, Social Services Legislation Amendment (Cashless Debit

Card Trial Expansion) Bill 2018 [Provisions], 14 August 2018.

5

Cape York IM program and the end date for CDC trial sites in East Kimberley, Ceduna and the Goldfields.25  The Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 (report tabled 7 November 2019)

proposed to transition the NT and Cape York sites from IM to the CDC trial. 26

Key provisions of the bill

Continuing the CDC as an ongoing measure 1.22 Item 16 repeals section 124PF to remove the trial parameters (including the CDC trial cap of 15 000 participants), reflecting the transition to the CDC as an ongoing measure. The ability to place people onto the CDC program is still

limited by the operation of the program participant and voluntary participant criteria. 27

Transition from IM to CDC in the NT and Cape York region, Queensland 1.23 Item 50 adds new subsection 123UF(4) which provides for the relationship between section 123UF and Part 3D of the Act as a person transitions from IM to the cashless welfare arrangements.28

1.24 Item 81 amends subsection 124PJ(1) to ensure that program participants who transition to the cashless welfare arrangements under new sections 124PGD and 124PGE will not be subject to the same restricted portion and unrestricted portion as existing program areas. This will maintain the current restricted and unrestricted portions for the NT and Cape York area under IM.29

Extension of IM in the Cape York area 1.25 Item 5 extends the sunset date for IM in Cape York, Queensland from 30 June 2020 to 31 December 2021 under paragraphs 123UF(1)(g) and 123UF(2)(h) of the Act. This reflects that the transition to the CDC in the Cape

York region will not occur until after the existing test time of

31 December 2020.

25 Community Affairs Legislation Committee, Social Services Legislation Amendment (Income

Management and Cashless Welfare) Bill 2019 [Provisions], 1 April 2019.

26 Community Affairs Legislation Committee, Social Services Legislation Amendment (Income

Management to Cashless Debit Card Transition) Bill 2019 [Provisions], 7 November 2019.

27 Explanatory memorandum, p. 9.

28 Explanatory memorandum, p. 13.

29 Explanatory memorandum, p. 19.

6

Sharing information with community bodies 1.26 Item 93 adds new sections 124POA, 124POB, 124POC and 124POD at the end of Division 4 of Part 3D, which authorises certain information disclosures to be made to the Secretary by an officer or employee of a financial institution or by

a member, officer or employee of a community body (as well as certain reverse disclosures). New section 124POA will allow the Secretary to disclose information to a member, officer or employee of a community body that a person has ceased to be a program participant or a voluntary participant. New sections 124POB, 124POC and 124POD replicate the current information sharing provisions in place for IM in Part 3B of the Social Security Administration Act.30

Remaining a voluntary participant after moving out of a program area 1.27 Item 29 omits the phrase ‘is within a trial area’ under paragraph 124PH(1)(b) and substitutes it with ‘is, becomes or was within a program area’. This allows a person the choice to remain as a voluntary program participant if the person

no longer resides in a program area.31

Allowing reviews of wellbeing exemption determinations 1.28 Item 32 repeals subsection 124PHA(3) and substitutes it with new subsections 124PHA(3), (3A) and (3B). New subsection 124PHA(3) allows the Secretary to reconsider existing wellbeing exemptions if asked to do so by an officer or

employee of a State or Territory. New subsection 124PHA(3A) provides that the Secretary must revoke the subsection 124PHA(1) determination if the Secretary receives a request under subsection 124PHA(3) and the Secretary is no longer satisfied that being a program participant poses a serious risk to the person. New subsection 124PHA(3B) provides that subsection 124PHA(3A) does not prevent the Secretary from making another determination under subsection 124PHA(1). 32

Enabling determinations for exit criteria 1.29 Item 37 inserts new subsections 124PHB(7A) and (7B) in section 124PHB. Section 124PHB provides that a person may exit the CDC if the Secretary is satisfied that a person can demonstrate reasonable and responsible

management of their affairs (including financial affairs) in line with the requirements set out in this section. New subsection 124PHB(7B) provides that the Minister may, by legislative instrument, determine decision-making principles for the purposes of subsection 124PHB(7A). This instrument is subject to disallowance. New subsection 124PHB(7A) provides that the

30 Explanatory memorandum, p. 23.

31 Explanatory memorandum, p. 10.

32 Explanatory memorandum, p. 10.

7

Secretary must comply with any decision-making principles determined in an instrument under subsection 124PHB(7B) when deciding whether the Secretary is satisfied of the requirements mentioned in subsection 124PHB(3) (i.e. demonstrating reasonable and responsible management of their affairs (including financial affairs)). 33

Reviewing exit determinations 1.30 Item 39 inserts new subsection 124PHB(9A) which provides that, if the Secretary ceases to be satisfied as mentioned in subsection 124PHB(3), the Secretary must revoke the exit determination. While a person may have met

the criteria at one point and been exited from the CDC program, this provision ensures that the Secretary has the power to review and revoke an exit determination where the Secretary becomes aware of information that suggests a person is no longer reasonably and responsibly managing their affairs.34

Enabling the Secretary to issue notices 1.31 New subsections 124PG(4), 124PGA(4), 124PGB(4) and 124PGC(4) provide that the Secretary may give a written notice stating that the person is a program participant under the relevant section and comes into force on a day specified

in the notice which must not be earlier than the day on which the notice is given. 35

Improving the evaluation process 1.32 Item 114 repeals subsections 124PS(2) and (3) to remove the statutory requirement that an evaluation be conducted by an independent expert within six months of the completion of a review of the cashless welfare arrangements.

This addresses the potentially circular nature of current section 124PS. The repeal of subsection 124PS(3) removes the requirement on independent experts to consult program participants which, in turn, will avoid the ethical implications of unnecessary repeat contact with vulnerable individuals.36

Financial implications 1.33 The EM to the bill notes that $17.5 million will be provided for support services to assist the transition in the NT and Cape York area.37 The costs associated with changing the CDC to an ongoing measure are not for

33 Explanatory memorandum, p. 11.

34 Explanatory memorandum, p. 11.

35 Explanatory memorandum, p. 26.

36 Explanatory memorandum, p. 27.

37 Explanatory memorandum, p. 1.

8

publication as negotiations with potential commercial providers are yet to be finalised.38

Legislative scrutiny

Senate Standing Committee for the Scrutiny of Delegated Legislation 1.34 The Senate Standing Committee for the Scrutiny of Delegated Legislation (delegated legislation committee) is considering the Coronavirus Economic Response Package (Deferral of Sunsetting— Income Management and

Cashless Welfare Arrangements) Determination 2020.39 The instrument extends the end date for the CDC trial in all existing sites and IM in the Cape York region for a further six months until 31 December 2020.

1.35 The delegated legislation committee has raised scrutiny concerns with the use of delegated legislation to defer the sunsetting of primary legislation and on 31 August 2020 placed a notice of motion to disallow the instrument, for consideration and debate in the Senate on 3 September 2020.40

1.36 Following correspondence with the Minister for Families and Social Services and the introduction of the current bill into the House of Representatives, the delegated legislation committee resolved to postpone its notice of motion to disallow the instrument to 12 November 2020, with a view to withdrawing the notice of motion should the bill be agreed to by the Senate.41 On 11 November 2020, the notice of motion to disallow the instrument was postponed until 7 December 2020.42

Parliamentary Joint Committee on Human Rights 1.37 The Parliamentary Joint Committee on Human Rights (PJCHR) had not reported on its consideration of the bill at the time this report was prepared.43 Consideration of previous related legislation by PJCHR is outlined in the

committee’s earlier reports on legislation related to the CDC trial.44

38 Commonwealth of Australia, Budget Measures: Budget Paper No. 2 2020–21, pp. 150–151.

39 Senate Standing Committee for the Scrutiny of Delegated Legislation, Monitor 9 of 2020, 27 August

2020, pp. 7–10 and Monitor 10 of 2020, 2 September 2020, pp. 11–14.

40 Journals of the Senate, No. 63, 31 August 2020, p. 2172.

41 Senate Standing Committee for the Scrutiny of Delegated Legislation, Monitor 11 of 2020 –

Committee correspondence, 8 October 2020, p. 26.

42 Journals of the Senate, No. 72, 11 November 2020, p. 2538.

43 Parliamentary Joint Committee on Human Rights (PJCHR), Deferred legislation, Report 12 of 2020;

15 October 2020, p. 51.

44 See also: PJCHR reports: PJCHR reports: Thirty-first report of the 44th Parliament, 24 November 2015,

pp. 21–36; Review of Stronger Futures measures, 16 March 2016, p. 61; Report 7 of 2016, 11 October 2016, pp. 58–61; Report 9 of 2017, 5 September 2017, pp. 34–40; Report 11 of 2017, 17 October 2017,

9

1.38 Earlier this year, the PJCHR finalised its consideration of the Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019. The PJCHR commented that the bill engages and limits the rights to privacy, social security, and equality and non-discrimination but concluded that any limitation on human rights is justifiable, noting the important outcomes sought to be achieved by the CDC program.45

Senate Standing Committee for the Scrutiny of Bills 1.39 The Senate Standing Committee for the Scrutiny of Bills (scrutiny of bills committee) had not reported on its consideration of the bill at the time this report was prepared. Consideration of previous related legislation by the

scrutiny of bills committee is outlined in the committee’s previous reports on this matter.

1.40 Last year, the scrutiny of bills committee considered the Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019. Detailed advice was sought and received from the Minister regarding the nature of participants’ information that could be collected under amended paragraph 192(db) (also proposed in the current bill) and the safeguards for participants’ privacy. The scrutiny of bills committee requested the Minister’s advice be included in the EM and made no further comment.46

Conduct of inquiry 1.41 On 8 October 2020, the Senate referred the provisions of the bill to the committee for inquiry and report.47 The committee agreed to a reporting date of 17 November 2020.

1.42 The committee advertised the inquiry on its website and invited submissions by 23 October 2020. The committee received 145 submissions, listed at Appendix 1 of this report.

1.43 The committee also conducted a public hearing on 5 November 2020. A list of witnesses for that hearing is included at Appendix 2 of this report.

pp. 126–137; Report 6 of 2018, 26 June 2018, p. 33; Report 2 of 2019, 2 April 2019, p. 146; Report 6 of 2019, 5 December 2019, pp. 39–53; Report 1 of 2020; 5 February 2020, pp. 132–142.

45 Parliamentary Joint Committee on Human Rights, Report 1 of 2020; 5 February 2020, pp. 132–142.

46 Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest 6 of 2019, 18 September 2019,

pp. 18–21; Senate Standing Committee for the Scrutiny of Bills, Scrutiny Digest 7 of 2019, 16 October 2019, pp. 82–90.

47 Journals of the Senate, No. 69, 8 October 2020, pp. 2407–2409.

10

Acknowledgement 1.44 The committee would like to thank those individuals and organisations that made submissions and gave evidence at the public hearing.

Note on references 1.45 References to the committee Hansard are to the proof transcript. Page numbers may vary between the proof and official Hansard transcripts.

11

Chapter 2 Key issues

2.1 The CDC program has the objective of reducing immediate hardship and deprivation, helping welfare recipients with their budgeting strategies and reducing the likelihood that they will remain on welfare and out of the workforce for extended periods.1

2.2 Similar to previous inquiries into the CDC program, evidence from the inquiry indicated broad recognition of the need to address antisocial behaviour and support improvements in social and financial wellbeing at an individual and community level.2

2.3 The committee received evidence which reflected the diverse range of views on the CDC. Whilst some submitters were supportive of the program, other submitters continued to raise similar concerns to those identified in the committee’s previous inquiries into the CDC program.3

2.4 This chapter explores key issues raised by inquiry participants including harm reduction; card functionality; monitoring and evaluation; and other concerns.

Harm reduction 2.5 The primary purpose of the CDC program is to reduce harm at a community level from the use of harmful products such as alcohol, illicit drugs and gambling. A flow-on impact is that participants are able to stabilise their lives,

leading to an increased ability to participate in the workforce.4

1 The Hon. Trevor Evans MP, House of Representatives Hansard, 8 October 2020, p. 3.

2 See, for example, Generation One (Minderoo Foundation), Submission 38, pp. 4–6; Family

Responsibilities Commission, Submission 41, pp. 4–5; Allan Suter, Submission 94, p. 1. See also: Community Affairs Legislation Committee, Social Services Legislation Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 [Provisions], 7 November 2019; Community Affairs Legislation Committee, Social Services Legislation Amendment (Income Management and Cashless Welfare) Bill 2019 [Provisions], 1 April 2019; Community Affairs Legislation Committee, Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018 [Provisions], 14 August 2018.

3 See, for example, Human Rights Law Centre, Submission 17, pp. 2–4; North Australian Aboriginal

Justice Agency, Submission 134, pp. 2–5; Adjunct Professor Eva Cox AO, Submission 55, pp. 1–4. See also: Community Affairs Legislation Committee, Social Services Legislation Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 [Provisions], 7 November 2019; Community Affairs Legislation Committee, Social Services Legislation Amendment (Income Management and Cashless Welfare) Bill 2019 [Provisions], 1 April 2019.

4 Explanatory memorandum, Statement of compatibility with human rights, p. 29.

12

2.6 The Shire of Coolgardie reported that, prior to the rollout of the CDC trial in the Goldfields region, community leaders and Aboriginal elders expressed an urgent need for serious social issues to be addressed including antisocial behaviour, crime, substance abuse, domestic violence and child neglect.5

2.7 The Hon. Trevor Evans MP pointed out in his second reading speech that the CDC program has shown positive signs in reducing harm and encouraging socially responsible behaviour in the trial sites, with more of participants’ welfare payments being directed to essential items:

Over the life of the program, over $125 million has been spent at businesses that sell groceries and food, that could not be spent on restricted items like alcohol, drugs and gambling products.6

Safer communities 2.8 Since its introduction, the CDC has had positive impacts on addressing violence and antisocial behaviours.7 Evidence received from the Goldfields CDC trial site indicated local police and ambulance officers have noticed a

decrease in offences and callouts.8

2.9 Similarly, in the Ceduna trial site, a community paramedic reported observing a decline in domestic violence, alcohol consumption and numbers of people presenting to the emergency department at the hospital.9

2.10 This was supported by the National Council of Women Australia which shared insights from women in the East Kimberley region:

According to those working in the refuge, serious assaults and domestic and family violence reports have declined.10

2.11 Further, according to a Councillor and former police prosecutor in Ceduna, the introduction of the CDC has resulted in a decline in court presentations:

The numbers of people presenting to court have declined. We used to hold court once a month. This has now declined to once every two months due to a decline in numbers.11

5 Shire of Coolgardie, Submission 92, p. 1.

6 The Hon. Trevor Evans MP, House of Representatives Hansard, 8 October 2020, p. 4.

7 See, for example, Shire of Coolgardie, Submission 92, pp. 2–3; Wunan Foundation, Submission 25,

p. 8.

8 Shire of Coolgardie, Submission 92, p. 2.

9 Generation One (Minderoo Foundation), Submission 38, p. 4.

10 Ms Robyn Nolan, President, National Council of Women Australia, Committee Hansard,

5 November 2020, p. 16. Ms Nolan committed to provide the committee with a copy of relevant police reports however due to being interstate, indicated to the committee she was unable to do so by the report’s tabling date (Ms Nolan, President, National Council of Women Australia, Committee Hansard, 5 November 2020, p. 24).

11 Generation One (Minderoo Foundation), Submission 38, p. 5.

13

Child welfare 2.12 A number of inquiry participants described the positive outcomes of the CDC on the health and wellbeing of children, including improved nutrition and access to regular meals, better clothing, and increased school attendance.12

2.13 For example, the Shire of Coolgardie advised the committee that local primary schools have reported increased student attendance with punctual arrival and appropriate clothing and school uniforms.13

2.14 Reports from a community elder in Kalgoorlie communicated a similar picture:

We see families going to the shop to buy breakfast and lunch in the morning before school, so kids are better prepared for school… You see kids walking in new shoes, new clothes. They are cleaner, better fed and going to school.14

2.15 This sentiment was echoed by women and family members in the Kimberley who reported to the National Council of Women Australia that:

They are pleased with the card. They can feed their families. Kids aren’t going to school hungry and…kids who were caught trying to steal food have also declined in Kununurra.15

Other positive outcomes 2.16 These improvements in socially responsible behaviour have positive flow-on benefits in contributing to a sense of personal achievement for individuals in the CDC trial areas. For example, a Coolgardie Aboriginal elder shared her

personal story that, since being on the CDC, her grandson has been able to save up for a new family car that he has now proudly purchased.16

2.17 Further, as a community elder from the East Kimberley explained, the quarantining of welfare payments has also had a positive impact on employment outcomes in the CDC trial sites:

My son had a long-term problem with the grog for five years. After the CDC came in it helped him get sober and now, he is working with a well-known Indigenous TV personality as a cultural advisor. It has changed his life. His wife is also working now.17

12 See, for example, Generation One (Minderoo Foundation), Submission 38, p. 5; Shire of Coolgardie,

Submission 92, p. 2; Wunan Foundation, Submission 25, pp. 5 and 11.

13 Shire of Coolgardie, Submission 92, p. 3.

14 Generation One (Minderoo Foundation), Submission 38, p. 5.

15 Ms Robyn Nolan, President, National Council of Women Australia, Committee Hansard,

5 November 2020, p. 16.

16 Shire of Coolgardie, Submission 92, p. 3.

17 Generation One (Minderoo Foundation), Submission 38, p. 5.

14

2.18 The committee also heard examples of individuals in trial sites improving their technical capabilities as a result of the CDC:

In fact, one woman told me of her young son, who taught her to order online. I think this is a gorgeous story. Coles removing the ordering of alcohol online is, in my view, very positive. The woman told me, ‘The whole family looks forward to the food just turning up’.18

Impacts of COVID-19 stimulus measures 2.19 According to the Minderoo Foundation’s Generation One, the recent COVID-19 pandemic stimulus measures not subject to the CDC and the temporary pause on new CDC participants have had a negative impact:

This temporary pause, which has been in place since March 25, has not only resulted in significant numbers of people who would otherwise be CDC participants not being placed on the CDC, it was compounded by the $550 per fortnight Coronavirus Supplement, resulting in a significant inflow of cash into communities that had otherwise adapted to a largely cashless economy.19

2.20 The Wunan Foundation supported this notion by pointing to media reports from the West Kimberley (which does not have the CDC) that increased welfare payments as a result of the COVID-19 pandemic had increased social harm.20 The Wunan Foundation maintained that without the CDC, the East Kimberley region would have experienced similar exacerbation of issues of Indigenous disadvantage and social dysfunction.21

2.21 Mr Allan Suter OAM, the former Mayor of Ceduna also noted that in the Ceduna region in recent months, large payments of superannuation withdrawals have resulted in a return to excessive levels of alcohol consumption, gambling and drug use among some visitors and community members leading to domestic violence, fights and other distressing matters. Mr Suter OAM suggested any withdrawal of the CDC may therefore see a re-emergence of such harmful behaviours.22

2.22 Similarly in Cape York, the Family Responsibilities Commission pointed to concerns of destabilisation in local households should the model not continue:

For example, recently, with the stimulus moneys, it has been the view of those local commissioners on the ground that because those moneys weren’t subjected to our current income management arrangements it

18 Ms Robyn Nolan, President, National Council of Women Australia, Committee Hansard,

5 November 2020, p. 16.

19 Generation One (Minderoo Foundation), Submission 38, p. 3.

20 Erin Parke, ‘COVID-19 cash linked to booze bingers, violence in Northern WA’, ABC News, 12 July

2020.

21 Wunan Foundation, Submission 25, p. 8.

22 Mr Allan Suter OAM, Submission 94, p. 2.

15

meant there was an increase in gambling and other socially irresponsible behaviours.23

Financial literacy 2.23 One criticism of income management is that by imposing restrictions on how money can be spent, individuals are not actually supported to build skills to manage their own finances.24 The committee received on-the-ground

comments from CDC holders regarding some practical disadvantages of the card:

On the card, we can’t see the cash in our hands and so we can’t work out how much money we’ve got and it’s confusing for people.25

2.24 The bill includes a new paragraph to identify that supporting program participants and voluntary participants with their budgeting strategies is a key objective of the program.26

2.25 DSS reported that participants are now able to check their account balance and track their spending through various technologies, including online and the Indue mobile application. Participants can also set up text message notifications when they make a purchase using their CDC to inform participants on how much they have spent and their remaining account balance.27

2.26 The Shire of Coolgardie reported that it has witnessed improved financial outcomes for participants, who have previously struggled with their finances, now being able to save money since the introduction of the trial:

The free automatic text message alerts to track the balance of Cashless Debit Card accounts has, by a long stretch, been the most convenient and positively received service.28

2.27 In addition, DSS funds a range of support services to assist CDC participants’ financial management practices, including local partners through the card provider, financial counsellors and case management programs.29

23 Mrs Tammy Williams, Commissioner, Family Responsibilities Commission, Committee Hansard,

5 November 2020, p. 23.

24 Dr Elise Klein OAM, Submission 99, [pp. 2–3]; North Australian Aboriginal Justice Agency,

Submission 134, Attachment 1, pp. 19–20; Australian Council of Social Service, Submission 130, Attachment 3 (Cashless debit cards & income management: a briefing note on the evidence), p. 13; Name withheld, Submission 93, [p. 2]; Name withheld, Submission 111, [p. 2].

25 Josephite SA Reconciliation Circle, Submission 20, p. 2.

26 Explanatory memorandum, p. 8.

27 Department of Social Services and Services Australia, Submission 26, p. 6.

28 Shire of Coolgardie, Submission 92, p. 3.

29 Department of Social Services and Services Australia, Submission 26, p. 6 and Commonwealth of

Australia, Budget Measures: Budget Paper No. 2 2020–21, pp. 153–154.

16

2.28 This budgeting support was acknowledged by the Salvation Army:

We therefore welcome the announcement in the 2020-21 federal budget of additional funding to continue Money Support Hubs that provide financial counselling, basic budgeting skills and financial education in 33 IM and CDC locations.30

2.29 DSS reported to the committee that CDC has supported participants to build savings, with the payment of monthly interest on funds held in their CDC accounts commencing on 23 June 2020 (including back paid interest to 1 July 2019).31 Program data shows that 14 per cent of participants have been able to hold $500 or more in their accounts, with approximately 500 of those being single parents.32

Issues with card functionality 2.30 Evidence received during previous inquiries and this inquiry indicated that people reported that there were significant issues associated with the functionality of the CDC and BasicsCard, including access to some retailers,

payment issues and system outages.33

2.31 Submitters also expressed concerns about the stigma and sense of shame experienced by cardholders.34

2.32 While some of this evidence could not be substantiated by DSS or Indue, DSS has acknowledged these issues and has worked towards resolving them through a number of improvements to the Indue Card for CDC participants.35 Additionally, according to DSS, the proposal to transition BasicsCard holders to the CDC will assist in addressing concerns associated with the BasicsCard.36

Technology enhancements 2.33 Multiple inquiry participants expressed frustration with transactions being declined for no apparent reason and the limitations on not being allowed to

30 The Salvation Army Australia, Submission 9, p. 10.

31 Department of Social Services and Services Australia, Submission 26, p. 6.

32 Explanatory memorandum, Regulation Impact Statement, p. 28.

33 See, for example, Dr Shelley Bielefeld, Professor Greg Marston, Dr Michelle Peterie and Dr Zoe

Staines, Submission 118, Attachment 1 (Hidden Costs: An Independent Study into Income Management in Australia), p. 86; Name withheld, Submission 51, [pp. 1–2]; Name withheld, Submission 111, [p. 2].

34 See, for example, Danila Dilba Health Service, Submission 120, p. 7; Accountable Income

Management Network, Submission 128, p. 3; Aboriginal Medical Services Alliance Northern Territory, Submission 132, p. 3.

35 Department of Social Services and Services Australia, Submission 26, pp. 5–8.

36 Explanatory memorandum, Regulation Impact Statement, p. 35.

17

purchase approved goods at some mixed merchants (those selling restricted and non-restricted goods).37

2.34 DSS data shows the vast majority of declined transactions are due to insufficient funds. 38

2.35 However, the difficulties related to shopping at mixed merchants with the CDC remain a key concern.39 For example, the No Cashless Welfare Debit Card Australia community group explained the limitations this can have, particularly in regional areas:

The people out in the regions—for instance, cardholders who are living out in the regions—face multiple issues of cards not being able to be used at the shop in their towns. As for servos, many don’t accept the card in regional areas, especially in WA.40

2.36 DSS is addressing the issue through developing two Product Level Blocking (PLB) solutions for small and medium merchants and working with major national merchants to implement their own solutions.41

2.37 At September 2020, a number of merchants across the East Kimberley, Goldfields and Bundaberg and Hervey Bay areas have now deployed PLB capability. PLB has also been implemented at national merchants such as Australia Post, Woolworths, Coles and Aldi.42

2.38 The committee was advised of the expectation that 70 per cent of mixed merchants will be equipped with the automated PLB technology within the next 12 months.43

2.39 The introduction of PLB means merchant staff do not need to know what type of card the customer is using. This helps to improve the shopping experience for the cardholder, opens up opportunities for participants to shop at more businesses and simplifies operations for the merchant.44

37 See, for example, The Say NO Seven, Submission 8, p. 7; Queensland Council of Social Service,

Submission 6, pp. 14 and 20–23.

38 Mr Ben Peoples, Acting Branch Manager, Welfare Quarantining, Department of Social Services,

Budget Estimates 2020–21, Committee Hansard, 28 October 2020, p. 93.

39 See, for example, Jesuit Social Services, Submission 11, p. 5; North Australian Aboriginal Justice

Agency, Submission 134, Attachment 1, p. 25; National Aboriginal Community Controlled Health Organisation, Submission 135, pp. 5–6.

40 Ms Kathryn Wilkes, Main Administration Officer, No Cashless Welfare Debit Card Australia,

Committee Hansard, 5 November 2020, p. 11.

41 Department of Social Services and Services Australia, Submission 26, p. 6.

42 Department of Social Services and Services Australia, Submission 26, p. 6.

43 Mr Bruce Mansfield, Strategic Adviser, Minderoo Foundation, Committee Hansard, 5 November

2020, p. 26.

44 Explanatory memorandum, Regulation Impact Statement, p. 6.

18

Consumer choice 2.40 Concerns were also raised with the committee regarding the lack of consumer choice by forcing participants onto a certain financial provider, currently Indue.45 For example, the Centre for Excellence in Child and Family Welfare

submitted:

The withdrawal of this consumer choice, albeit for a small proportion of income, constitutes an unjust and disproportionate restriction of agency and financial rights and sets a dangerous precedent that allows government to decide which consumer markets people may engage in and on what terms.46

2.41 The Government has also received such feedback regarding the requirement for participants to maintain accounts with two different financial institutions while on the CDC. As a result, DSS is exploring the feasibility of multiple card issuers, to give participants a choice of which financial institution they have their CDC account with.47

2.42 A representative from the CDC Technology Working Group noted the expectation that the functionality for multiple card issuers would be available by June 2021.48

Stigma 2.43 The committee received evidence that stigma and a sense of shame associated with having a CDC remain issues for many participants. 49 In particular, concerns were raised regarding stigma leading to an increase in mental health

issues amongst CDC participants and their families.50

2.44 These findings are also reflected in the early results from the Draft Second Impact Evaluation, which indicate that feelings of discrimination, embarrassment, shame, and unfairness as a result of being on the card were experienced by participants.51

45 See, for example, Consumer Action Law Centre, Submission 2, p. 3; The Say NO Seven, Submission

8, p. 14; No Cashless Welfare Debit Card Australia, Submission 18; p. 4; UnitingCare Australia, Submission 32, p. 17.

46 Centre for Excellence in Child and Family Welfare, Submission 60, p. 2.

47 Department of Social Services and Services Australia, Submission 26, p. 6.

48 Mr Bruce Mansfield, Strategic Adviser, Minderoo Foundation, Committee Hansard, 5 November

2020, p. 30.

49 See, for example, Bielefeld, Marston, Peterie, Staines, Submission 118, p. 5; Uniting Care, Submission

32, pp. 6–7; Australian Council of Trade Unions, Submission 3, p. 1; Queensland Council of Social Service, Submission 6, pp. 4 and 6.

50 See, for example, Law Council of Australia, Submission 137, pp. 14 and 29; The Salvation Army

Australia, Submission 9, pp. 6–7; Public Health Association of Australia, Submission 21, p. 5.

51 Explanatory memorandum, Regulation Impact Statement, p. 30.

19

2.45 DSS reported that this feedback has been recognised and continual improvements have been made to the CDC to ensure it looks and functions like any other debit card. For example, the card was redesigned to remove the Indue logo from the front and as of 29 July 2020, contactless cards became available to participants.52

2.46 The introduction of PLB is also assisting in reducing stigma as the merchants do not need to know which type of card is used by customers.53

2.47 In its submission to the inquiry, the Salvation Army recognised the progress made to reduce stigma:

We welcome the work being progressed on technology options to improve the operation of the CDC, including to enable multiple card issuers and product level blocking. It is our hope that this will go some way towards reducing the stigma associated with the physical card.54

System outages 2.48 The committee received accounts from some individuals of the CDC malfunctioning and payments, such as rent, not processing as intended.55 For example, at a public hearing, Ms Wilkes told the committee about instances

where CDC malfunctions had severe consequences:

There have been so many cases of people and their rent not being paid being placed […] which means they can no longer get rentals in the rental market as owners have blacklisted them for non-payment of rent.56

2.49 In November 2019, in response to concerns raised about system malfunctions impacting the user experience, DSS and Indue implemented stand-in processing which means that Indue outages from this date will not affect CDC transactions. Stand-in processing enables a third party to authorise transactions should Indue have a system outage, allowing participants to keep making payments with their CDC.57

52 Explanatory memorandum, Regulation Impact Statement, pp. 30 and 61 and Senator the Hon. Anne

Ruston, Minister for Families and Social Services, ‘Cashless Debit Card update’, Media release, 5 May 2020.

53 Explanatory memorandum, Regulation Impact Statement, p. 6.

54 The Salvation Army Australia, Submission 9, p. 6.

55 See, for example, No Cashless Welfare Debit Card Australia, Submission 18, p. 1; Council of Single

Mothers and their Children, Submission 23, p. 2; Fair Go for Pensioners Coalition, Submission 1, p. 2.

56 Ms Kathryn Wilkes, Main Administration Officer, No Cashless Welfare Debit Card Australia,

Committee Hansard, 5 November 2020, p. 11.

57 Department of Social Services, Answer to Question on Notice: SQ20-000264, 5 March 2020, p. 1.

20

Large one-off purchases 2.50 In addition, some inquiry participants were concerned about the restrictions on large expenses and the need to approach the current card provider, Indue, to facilitate larger purchases.58

2.51 DSS advised the committee that, to ensure participants are able to make larger cash-only purchases, participants are able to transfer up to $200 from their CDC account to their regular bank account every 28 days. Participants can complete this transfer online through their CDC account.59

2.52 Generation One (Minderoo Foundation) suggested that many CDC participants and community members may be broadly unaware of this option.60

Online shopping 2.53 The committee received evidence of CDC users being unable to purchase products online and other reports from individuals outside the trial sites who were concerned that the card would not allow for online purchases.61 For

example, an inquiry participant voiced her concerns that the CDC would significantly impact access to products:

My variety and choice of what I can buy and where I can buy them will be limited. I will not be able to shop online for cheaper items or items that are unavailable in my area.62

2.54 DSS advised the committee that the CDC operates like a standard, mainstream banking product and also enables a range of flexible payment options including online transfers, BPAY, online shopping and recurring deductions.63

Transition from the IM BasicsCard to CDC 2.55 Technology associated with the IM BasicsCard has not advanced as much as the CDC which impacts the user experience for IM participants. IM limits the number of merchants who can accept the BasicsCard (currently accepted at

around 17 000 merchants compared with the CDC which is accepted at over

58 See, for example, Consumer Action Law Centre, Submission 2, p. 2; Name withheld, Submission 96,

p. 1; Name withheld, Submission 57, p. 2.

59 Department of Social Services and Services Australia, Submission 26, p. 7.

60 Generation One (Minderoo Foundation), Submission 38, p. 7.

61 See, for example, Queensland Council of Social Service, Submission 6, Attachment 2, p. 23; Name

withheld, Submission 113, [p. 2]; Name withheld, Submission 53, [p. 2]; Name withheld, Submission 74, [p. 1].

62 Name withheld, Submission 74, [p. 1].

63 Department of Social Services and Services Australia, Submission 26, p. 7.

21

900 000 terminals), which limits the options for where IM participants can purchase essential items.64

2.56 The committee received evidence of IM participants struggling with the limitations imposed by the BasicsCard. For example, in a study of income management in Australia, participants explained that, in addition to certain supermarkets, the BasicsCard was not accepted by various petrol stations, sports stores, jewellery stores, hardware stores, restaurants that serve alcohol and veterinary clinics. Some participants also struggled to find essential health services that accepted the card – for example, optometrists and pharmacists.65 One of the study participants recalled:

I had to go in and get my medication […] They turned around and they kept saying you can’t use the BasicsCard to pay the prescriptions. You couldn’t find anyone who would basically take this BasicsCard for anything.66

2.57 As well as expanding the range of eligible retailers, transitioning to the updated technology of the CDC will assist in reducing stigma as it allows users to purchase items from mixed merchant stores without having to line up in separate queues to use the card, as is the case with the BasicsCard.67

2.58 Following consultations with NT communities throughout 2018–2020, DSS informed the committee that the consistent message from the majority of community members was that the CDC is a superior product and offers improved functionality and greater consumer choice for participants as compared to the BasicsCard.68

Monitoring and evaluation

Evaluations to date

ORIMA CDC trial evaluation 2.59 As was the case in previous inquiry reports related to CDC legislation, some inquiry participants questioned the methodology and characterisation of the

64 Explanatory memorandum, Regulation Impact Statement, p. 35.

65 Dr Shelley Bielefeld, Professor Greg Marston, Dr Michelle Peterie and Dr Zoe Staines, Submission

118, Attachment 1 (Hidden Costs: An Independent Study into Income Management in Australia), p. 52.

66 Dr Shelley Bielefeld, Professor Greg Marston, Dr Michelle Peterie and Dr Zoe Staines, Submission

118, Attachment 1 (Hidden Costs: An Independent Study into Income Management in Australia), p. 52.

67 Explanatory memorandum, Regulation Impact Statement, Attachment C, p. 61.

68 Department of Social Services and Services Australia, Submission 26, p. 3.

22

results of the 2017 ORIMA evaluation report. They argued that there was insufficient evidence to support claims of the trial’s effectiveness. 69

2.60 For example, Adjunct Professor Eva Cox AO criticised the data collection methods of the 2017 ORIMA evaluation including:

…the user questionnaire design, its length, the order of questions, the language and shape of some questions, and importantly, the probable contamination of responses.70

2.61 Generation One (Minderoo Foundation) noted that the ORIMA evaluation has been the most extensive evaluation of the CDC to date.71

2.62 In response to criticisms about the ORIMA research, DSS commissioned a Second Impact Evaluation to assess the ongoing impact of the CDC.72

Draft Second Impact Evaluation 2.63 The independent Second Impact Evaluation of the CDC is currently being finalised by the University of Adelaide and the early findings are in line with the many other evaluations of welfare quarantining measures.

2.64 DSS reported that early findings from the Draft Second Impact Evaluation identify:

 consistent and clear evidence that alcohol consumption has reduced since the introduction of the CDC;  short-term evidence that the CDC has been helping to reduce gambling, with positive impacts especially in the context of family and broader social

life; and  in relation to financial planning and money management, the CDC was reported to make things better for those who were probably the most vulnerable and who needed it most.73

2.65 Generation One (Minderoo Foundation) spoke to the committee about the importance of spending time in CDC trial sites to observe the benefits produced by the CDC:

It simply takes someone to walk around communities like Kununurra, … the Goldfields, and actually talking to people on the card and service providers and other community members to understand the impact this is

69 See, for example, Adjunct Professor Eva Cox AO, Submission 55, p. 3; Professor Matthew Gray and

Dr Rob Bray PSM, Submission 119, p. 2; Professor Tony Dreise, Dr Francis Markham and Dr Janet Hunt, Submission 105, pp. 5–7.

70 Adjunct Professor Eva Cox AO, Submission 55, p. 4.

71 Ms Shelley Cable, Chief Executive Officer, Generation One, Minderoo Foundation, Committee

Hansard, 5 November 2020, p. 26.

72 Explanatory memorandum, Regulation Impact Statement, Attachment C, p. 61.

73 Department of Social Services and Services Australia, Submission 26, pp. 4–5.

23

having…for us, that’s the strongest evaluation and evidence that anyone can get.74

2.66 Ms Shelley Cable, CEO of Generation One at the Minderoo Foundation, stressed to the committee the importance of not discrediting the lived experiences in community.75

Ongoing monitoring 2.67 Inquiry participants were supportive of ongoing evaluation of the CDC program however some considered the changes to the evaluation process as a diversion from scrutiny and accountability.76

2.68 The bill proposes to remove the statutory requirement that an evaluation be conducted by an independent expert within six months of the completion of a review of the cashless welfare arrangements. The EM explained that this provision is designed to address the potentially circular nature of current section 124PS:

The repeal of subsection 124PS(3) removes the requirement on independent experts to consult program participants which, in turn, will avoid the ethical implications of unnecessary repeat contact with vulnerable individuals.77

2.69 This provision does not remove the ability for the program to be reviewed. Rather, where the Minister causes a review of the CDC to be conducted, a desktop evaluation of that review will then take place.78

Impacts on IM participants in transitioning to CDC 2.70 As described in Chapter 1, the objective of the transition to the CDC for IM participants in the NT and Cape York is to provide the improved technology of the CDC, which enables a range of flexible payment options, greater access to

merchants and fewer restrictions on participants.79

74 Ms Shelley Cable, Chief Executive Officer, Generation One, Minderoo Foundation, Committee

Hansard, 5 November 2020, p. 26.

75 Ms Shelley Cable, Chief Executive Officer, Generation One, Minderoo Foundation, Committee

Hansard, 5 November 2020, p. 28.

76 See, for example, St. Vincent de Paul Society, Submission 4, p. 3; Centre for Excellence in Child and

Family Welfare, Submission 60, p. 2; WA Council of Social Service, Submission 19, p. 5; Accountable Income Management Network, Submission 128, pp. 9–10.

77 Explanatory memorandum, p. 27.

78 Explanatory memorandum, p. 7.

79 Explanatory memorandum, Regulation Impact Statement, p. 12.

24

2.71 The bill proposes amendments to ensure that IM program participants who transition to the CDC will maintain their current percentage of quarantined funds (50 per cent for most participants). 80

2.72 Concerns in relation to the transition from IM to the CDC included the ministerial discretion to vary the quantum of quarantined funds, access to tobacco purchases and lack of consultation with communities.

Ministerial discretion 2.73 Some submitters raised concerns about the ability of the Minister to vary the restricted portion from 50 per cent to 80 per cent, considering that all other CDC sites have 80 per cent of participants’ payments quarantined.81

2.74 DSS advised that the Minister will only exercise this power following a request from the community and that the measure allows different communities to take different approaches when submitting a request.82

2.75 Further, when considering a community request, the Minister will undertake necessary consultation before deciding whether to make an instrument varying the restricted portions.83

Tobacco 2.76 Notwithstanding the technological improvements in transitioning from the BasicsCard to the CDC, the committee heard concerns about the potential impact the transition may have on the health of Aboriginal and Torres Strait

Islander people in particular as IM currently restricts tobacco purchases whereas the CDC does not:

I think one of the negatives is that the BasicsCard actually prevented people from purchasing tobacco. The cashless debit card doesn’t prevent that. So there is concern that tobacco purchases will now increase and that will be very harmful to Indigenous people who suffer, for example, from heart disease and other lung diseases.84

2.77 DSS reported that this issue has been raised in community information sessions in the NT with some stakeholders and participants concerned that the removal of the restriction on tobacco will impact on communities. While

80 Explanatory memorandum, Statement of compatibility with human rights, p. 31.

81 See, for example, Northern Territory Council of Social Service, Submission 131, [p. 9]; UnitingCare

Australia, Submission 32, p. 21.

82 Explanatory memorandum, p. 22.

83 Explanatory memorandum, pp. 21–22.

84 Dr Janet Hunt, Private capacity, Committee Hansard, 5 November 2020, p. 7.

25

expenditure on tobacco will be monitored, CDC policy has not been changed to apply a more restrictive product to NT participants only.85

Consultation and support to facilitate transition from IM to CDC 2.78 Some inquiry participants raised concerns about the consultation process undertaken by the Government to date, including limited avenues for meaningful two-way discussion which would afford NT community members

a say in how this measure will apply to them.86

2.79 DSS informed the committee that from October 2019 to March 2020, it delivered 83 information sessions to over 70 communities, engaged with nearly 3 500 community members and met with over 120 stakeholder and local organisations on the proposed transition from IM to the CDC.87

2.80 COVID-19 travel restrictions meant the remainder of the Government’s planned consultations were unable to take place however DSS confirmed that it will continue to work with representative bodies, including land councils, service providers and Services Australia, to re-commence engagement activities in the NT and Cape York ahead of the proposed transition from IM to the CDC in these regions, while ensuring compliance with all COVID-19 safety requirements.88

2.81 Generation One (Minderoo Foundation) noted that although NT communities have been largely supportive of the CDC transition, assistance will be required for individuals to re-establish their banking arrangements including direct debits. 89

2.82 The North Australian Aboriginal Justice Agency also highlighted the importance of an adequate transition to ensure NT communities can capitalise on the advantages of the CDC:

Without adequate assistance to understand the proposed changes to the operation of welfare quarantining in the NT, we are concerned that individuals in remote Aboriginal communities will face additional difficulties resolving problems with using their card and accessing their money, with accessing the exemptions and exit procedures, and without taking advantage of changes to the card such as an increased ability to use it for online shopping and BPAY transactions.90

85 Explanatory memorandum, Regulation Impact Statement, p. 46.

86 See, for example, Aboriginal Peak Organisations of the Northern Territory, Submission 39, p. 5;

Northern Territory Government, Submission 91, pp. 3–4; Arnhem Land Progress Aboriginal Corporation, Submission 35, p. 4; Australian Human Rights Commission, Submission 37, p. 6.

87 Department of Social Services and Services Australia, Submission 26, p. 3.

88 Department of Social Services and Services Australia, Submission 26, pp. 3–4.

89 Generation One (Minderoo Foundation), Submission 38, p. 9.

90 North Australian Aboriginal Justice Agency, Submission 134, Attachment 1, p. 22.

26

2.83 $17.5 million has been allocated to transitioning IM in the NT and Cape York.91

Other key concerns raised by submitters

Limited opportunity for scrutiny 2.84 Some inquiry participants raised concerns about the limited timeframe for consideration and scrutiny of the bill and questioned the need to rush through legislation with such important implications for many Australians.92

2.85 However, the Regulation Impact Statement articulates that a number of the proposed provisions of the bill are identical to the amendments that were made in the Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 in response to the findings of the inquiry into the bill and further consultations.93

2.86 These changes, which have been incorporated into the current bill, include:

 limiting the ministerial power to increase the portion of a person’s payment placed onto the card to a maximum of 80 per cent for NT participants;  excluding Age Pension recipients from being compulsory CDC participants in the NT; and  establishing a power to terminate voluntary IM agreements in the NT.94

Establishing the CDC as an ongoing program 2.87 Some inquiry participants raised concerns about the bill’s proposal to establish the CDC as an ongoing program, especially prior to the finalisation of the Draft Second Impact Evaluation.95 Some submitters were concerned that there

is insufficient evidence to demonstrate that the CDC has been effective in existing trial sites. 96

91 Explanatory memorandum, p. 1.

92 See, for example, Australian Unemployed Workers’ Union, Submission 34, p. 2; Dr Shelley

Bielefeld, Professor Greg Marston, Dr Michelle Peterie and Dr Zoe Staines, Submission 118, pp. 3 and 29; Emeritus Professor Jon Altman, Submission 106, p. 2.

93 Community Affairs Legislation Committee, Social Services Legislation Amendment (Income

Management to Cashless Debit Card Transition) Bill 2019 [Provisions], 7 November 2019 and Explanatory memorandum, Regulation Impact Statement, Attachment B, p. 57.

94 Explanatory memorandum, Regulation Impact Statement, Attachment B, p. 57.

95 See, for example, Australian Human Rights Commission, Submission 37, pp. 2–6; Ms Jo Schofield,

Submission 86, pp. 1–2; The Salvation Army Australia, Submission 9, p. 4.

96 See, for example, Professor Tony Dreise, Dr Janet Hunt and Dr Francis Markham, Submission 105;

pp. 5–8; North Australian Aboriginal Justice Agency, Submission 134, Attachment 1, pp. 51–52; Name withheld, Submission 77, [p. 1].

27

2.88 To date, legislation has generally provided for 12 month extensions to the CDC arrangements.97

2.89 However, Generation One (Minderoo Foundation) noted that the CDC’s nature as a trial program has drawn criticism:

This ongoing uncertainty has caused inefficiency through administration […], confusion in trial sites, and an inability to reflect long-term thinking in the legislation. In addition, because it is viewed as a trial program, a number of technology limitations have not been addressed and adding new CDC Issuers beyond Indue has not been possible.98

2.90 DSS reported that the continuation of the CDC in the established sites is a direct response to calls from community leaders requesting that the Government deliver certainty to participants, stakeholders and communities by making the trial an ongoing measure:

This Bill will sustain the positive impacts and effectiveness of the CDC and signal the Government’s long-term commitment to the future of the CDC with financial institutions.99

Human rights 2.91 Similar to previous inquiries, some inquiry participants expressed unease about the extent to which the bill engages and limits certain human rights, observing that the limitations placed on participants’ human rights may not be

reasonable and proportionate to the aims of the bill.100

2.92 The statement of compatibility with human rights (statement of compatibility) recognised that the scheme engages and limits three human rights: the right to social security, the right to a private life and the right to equality and non-discrimination. Given the prevalence of social harm in the areas the scheme operates, the statement of compatibility concluded that there are effective community safeguards in place and the limitations on these rights are reasonable and proportionate to achieving the CDC program objectives.101

2.93 The Wunan Foundation supported the bill’s provisions which ensure that welfare payments are spent in the best interest of welfare recipients, submitting that:

97 Department of Social Services and Services Australia, Submission 26, p. 2.

98 Generation One (Minderoo Foundation), Submission 38, p. 3.

99 Department of Social Services and Services Australia, Submission 26, p. 2.

100 See, for example, UnitingCare Australia, Submission 32, pp. 15–17; Australian Human Rights

Commission, Submission 37, pp. 2–3; Queensland Council of Social Service, Submission 6, p. 15. See also Community Affairs Legislation Committee, Social Services Legislation Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 [Provisions], 7 November 2019.

101 Explanatory memorandum, Statement of compatibility with human rights, pp. 28–37.

28

The ‘freedom’ agenda, which argues that people should be able to spend their welfare payments on whatever they want, is surely eclipsed by the human rights of the vulnerable children and old people in the East Kimberley. The right to live free from violence, hunger, and despair. And the right to live full and independent lives.102

2.94 Further, some inquiry participants questioned the disproportionate impact of the bill on the rights of Aboriginal and Torres Strait Islander peoples, whom they considered to be overrepresented in the trial cohorts.103

2.95 The statement of compatibility notes that the program is not applied on the basis of race or cultural factors and that locations for the program have been chosen based on objective criteria, including high levels of welfare dependence and community harm. On that basis the statement of compatibility maintains that the rights to equality and non-discrimination are not directly limited by the bill. 104

Wellbeing exemption and exit determinations 2.96 A number of submitters raised concerns about the Secretary’s ability to review and revoke wellbeing exemptions and exit determinations citing a lack of clarity and transparency regarding the review and revocation process.105

2.97 Some inquiry participants highlighted potential issues about procedural fairness given the lack of clarity around what constitutes a satisfactory demonstration of a person’s ability to manage their affairs.106

2.98 For example, Change the Record is concerned that the bill’s provisions may confer too broad power on the Minister to raise or change the threshold of what is required to demonstrate that an individual is able to manage their affairs, and therefore exit the program.107

2.99 Currently, these exit applications are determined on a case by case basis. DSS advised the committee that this process would not add new criteria; rather it would set out principles that will provide participants with greater clarity

102 Wunan Foundation, Submission 25, p. 12.

103 See, for example, Catholic Social Services Australia, Submission 127, p. 2; Aboriginal Peak

Organisations Northern Territory, Submission 39, p. 2; Northern Territory Council of Social Service, Submission 131, [p. 3].

104 Explanatory memorandum, Statement of compatibility with human rights, p. 34.

105 See, for example, Human Rights Law Centre, Submission 17, pp. 2–3; UnitingCare Australia,

Submission 32, p. 22; Australian Council of Social Service, Submission 130, pp. 5–6.

106 See, for example, Change the Record, Submission 24, [p. 7]; Accountable Income Management

Network, Submission 128, p. 19.

107 Change the Record, Submission 24, [p. 7].

29

relating to the considerations that underpin the determination of exit applications.108

Other matters raised by submitters and witnesses 2.100 Inquiry participants also raised concerns about the following matters:

 The dichotomy between the transition of IM to the CDC program and the National Agreement on Closing the Gap which emphasises genuine partnerships and shared decision-making between governments and Aboriginal and Torres Strait Islander people.109  The need for a bottom-up approach which prioritises effective, genuine

engagement and consultation processes and structures to work in collaboration and partnership to address systemic issues, including welfare dependency.110  The acknowledgement that the card is an important element but is not a silver bullet and must be complemented by wraparound services such as employment and training pathways, transitional housing, financial counselling and addiction support.111  The ongoing validity of the no-action letter issued by the Australian Securities and Investments Commission in 2015 regarding the prohibition in section 12DL of the Australian Securities Investments Commission Act 2001 on unsolicited credit cards and debit cards.112

Committee view 2.101 This is the seventh inquiry into legislation relating to the CDC and IM that the committee has conducted in recent years. As such, the committee is well aware of the wide range of views on the CDC and IM. The committee notes that most

of the concerns raised by submitters in this inquiry have already been examined by the committee.

108 Explanatory memorandum, p. 6.

109 See, for example, Jesuit Social Services, Submission 11, p. 2; Arnhem Land Progress Aboriginal

Corporation (ALPA), Submission 35, p. 4; Mr John Paterson, Chief Executive Officer, Aboriginal Peak Organisations Northern Territory, Committee Hansard, 5 November 2020, p. 5.

110 See, for example, Mr John Paterson, Chief Executive Officer, Aboriginal Peak Organisations

Northern Territory, Committee Hansard, 5 November 2020, p. 5; Professor Tony Dreise, Dr Francis Markham and Dr Janet Hunt, Submission 105, pp. 13–14; Northern Territory Council of Social Service, Submission 131, [p. 21].

111 See, for example, Ms Shelley Cable, Chief Executive Officer, Generation One, Minderoo

Foundation, Committee Hansard, 5 November 2020, p. 25; The Salvation Army Australia, Submission 9, p. 8; Accountable Income Management Network, Submission 128, Attachment 2, p. 12.

112 Professor Jon Altman, Private capacity, Committee Hansard, 5 November 2020, p. 1–2.

30

Technological enhancements 2.102 The committee is of the view that the issues associated with the functionality of the CDC that were raised in this and previous inquiries as well as during community consultations are being actively addressed by DSS. With the

introduction of PLB solutions, CDC cardholders are now able to shop at more businesses, including online. Importantly, the PLB solutions combined with other technological improvements have significantly reduced the stigma associated with the card. The committee is confident that the CDC Technology Working Group established by DSS will continue to consider technology options to improve the operations of the CDC.

2.103 The committee is of the view that these improvements to the functionality of the card will greatly benefit IM participants transitioning to the CDC. Indeed, the CDC will provide greater consumer choice for participants compared to the BasicsCard, which is currently only accepted in a limited number of stores.

CDC as an ongoing program 2.104 The committee is encouraged by reports from local community members and organisations that the CDC is continuing to have a positive impact and reduce the level of social harm in each trial site. Importantly, reports of significant

improvements in the welfare of children in various communities indicate that the program is achieving its objective of reducing hardship and deprivation.

2.105 The committee notes the call for certainty around the program from some submitters. The committee is of the view that making the CDC an ongoing measure will provide stability and sees significant benefit in the continuation of the program.

2.106 The committee notes there was some confusion from individual submitters who expressed concern that the bill would roll CDC out nationally. The committee wishes to clarify that the bill proposes to establish the CDC as an ongoing program in only the existing CDC trial sites and IM locations.

Recommendation 1

2.107 The committee recommends that the bill be passed.

Senator Wendy Askew Chair

31

Dissenting Report by Labor Senators

1.1 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.

1.2 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.

1.3 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.

1.4 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.

1.5 In fact, significant harm has been associated with compulsory, broad-based income management.

1.6 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.1

1.7 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.2

1.8 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.

1 Luke Greenacre, Skye Akbar, Julie Brimblecombe & Emma McMahon, ‘Income Management of

Government Payments on Welfare: The Australian Cashless Debit Card’, Australian Social Work, 2020, https://doi.org/10.1080/0312407X.2020.1817961.

2 Luke Henriques-Gomes, ‘Cashless welfare card has little impact on gambling, drug and alcohol

abuse, study finds’, The Guardian, 13 November 2020, https://www.theguardian.com/australia-news/2020/nov/13/cashless-welfare-card-has-little-impact-on-gambling-drug-and-alcohol-abuse-study-finds (accessed 16 November 2020).

32

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.3

1.9 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.4

1.10 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.5

1.11 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.6

1.12 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.

1.13 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.

1.14 Ms Roe from APO NT summed up the lack of consultation:

3 Professor Tony Dreise, Private capacity, Committee Hansard, 5 November 2020, p. 2.

4 Royal Australian and New Zealand College of Psychiatrists, Submission 15, p. 1.

5 Ms Theresa Roe, Network Coordinator, Aboriginal Peak Organisations Northern Territory,

Committee Hansard, 5 November 2020, p. 3.

6 Committee Hansard, 28 October 2020, p. 94.

33

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.7

1.15 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.8

1.16 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.

1.17 Labor Senators believe the First Nations communities of the NT – and other parts of Australia – should be listened to.

1.18 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.9

1.19 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.

1.20 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

7 Ms Theresa Roe, Network Coordinator, Aboriginal Peak Organisations Northern Territory,

Committee Hansard, 5 November 2020, p. 3.

8 Professor Jon Altman, Private capacity, Committee Hansard, 5 November 2020, p. 6.

9 Mr John Paterson, Chief Executive Officer, Aboriginal Peak Organisation Northern Territory,

Committee Hansard, 5 November 2020, p. 5.

34

relationship between government and First Nations peoples need to be taken seriously when considering the current bill before the parliament.10

1.21 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.11

1.22 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.12

1.23 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.

1.24 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.

1.25 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…13

Conclusion 1.26 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;

10 Professor Tony Dreise, Private capacity, Committee Hansard, 5 November 2020, p. 2.

11 Professor Jon Altman, Private capacity, Committee Hansard, 5 November 2020, p. 1.

12 Ms Theresa Roe, Network Coordinator, Aboriginal Peak Organisations Northern Territory,

Committee Hansard, 5 November 2020, p. 3.

13 Combined Pensioners and Superannuants Association, Submission 28, pp. 4–5.

35

 Abandon its Technology Working Group – and preparations for a national rollout of the CDC.

1.27 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 1

1.28 Labor Senators recommend that the bill not be passed.

Senator Malarndirri McCarthy

Senator Patrick Dodson

37

Dissenting Report by the Australian Greens

Introduction 1.1 This bill seeks to permanently entrench compulsory income management, in the form of the Cashless Debit Card (CDC), as part of Australia’s social security system. The bill makes the CDC permanent in the current trial sites in

East Kimberley, Ceduna, Goldfields and Bundaberg. It also entrenches the CDC for over 25 000 people currently on the BasicsCard in the Northern Territory (NT).

1.2 The Australian Greens reject the majority committee view that making the CDC permanent will see significant benefit and the recommendation that the Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 (the Bill) be passed.

1.3 The Australian Greens share the concerns raised by stakeholders regarding the incredibly short timeframes given for the inquiry. A single half-day public hearing was held due to this short timeframe which did not adequately cover the significant concerns of stakeholders, especially those in the NT.

1.4 As the Australian Council of Social Services noted:

There will be more hearings held into the impact of feral deer, pigs and goats in Australia than for this bill, which will make permanent one of the most punitive social security measures in our recent history, that limits the rights of more than 25 000 people in Australia.1

1.5 This inquiry process has been inadequate given the changes this bill permanently makes to our social security system and its ability to harm the lives of tens of thousands of people.

1.6 In the middle of a global pandemic and Australia’s first recession in 30 years, the Government has chosen this moment as the right time to make the CDC permanent. It is astounding that the Government refuses to make any decisions about the base rate of the Jobseeker Payment due to the changing economic conditions but is happy to prematurely entrench compulsory income management.

1.7 There are also real practical implications of rolling out the CDC to remote communities during a global pandemic that has seen state and territory border closures.

1.8 In the final sitting weeks of 2020, the Senate will again be forced to vote on a complex and divisive piece of legislation in a short timeframe while many questions remain unanswered.

1 Correspondence to the Committee from the Australian Council of Social Service, received on

10 November 2020.

38

1.9 One such question is whether the Government will choose to place new income support recipients in the four trial sites onto the CDC. Although the Minister paused new entrants being placed on the CDC in March, it is unclear whether this pause will remain in place once the card becomes permanent. People have a right to know whether they will be placed onto the CDC before the scheme becomes permanent.

1.10 Another question is whether the Government will move to permanently expand the CDC to additional sites, or nationwide, without any requirement to undertake community consultation.

1.11 The Australian Greens condemn the Government’s pursuit of this ideological, ad-hoc, top down scheme. The CDC has not been demonstrated to be reasonable, necessary or proportionate. There is no evidence to justify the card’s permanent roll out.

1.12 We continue to hold serious concerns about the punitive nature of compulsory income management as expressed in our dissenting reports to previous inquiries into the CDC.

Lack of consultation around the permanency of the CDC 1.13 The Australian Greens remain strongly concerned at the absence of consultation about this bill, particularly the permanency of the CDC.

1.14 It is clear from evidence received through this inquiry and at Budget Senate Estimates that the Government did not consult communities in the NT about its intentions to make the CDC permanent.

1.15 Prior to COVID-19, the Department of Social Services (DSS) held information sessions with individuals and stakeholders in the NT. However, these information sessions did not ask communities in the NT if they supported the introduction of the CDC or the continuation of compulsory income management.2

1.16 As many submitters pointed out, information sessions are not an appropriate substitute for consultation.

1.17 The National Aboriginal Community Controlled Health Organisation (NACCHO) described in its submission:

The information sessions have been a one-way communication strategy as opposed to partnership and genuine decision making, and it is unclear as to how many Aboriginal and Torres Strait Islander community representatives were in attendance and had their voices heard.3

2 North Australian Aboriginal Justice Agency, Submission 134, p. 5.

3 National Aboriginal Community Controlled Health Organisation, Submission 135, p. 2.

39

1.18 The Aboriginal and Torres Strait Islander Social Justice Commissioner, June Oscar AO, said the lack of genuine consultation about the card was highlighted by First Nations women through the Wiyi Yani U Thangani project:

Women cited issues with a top-down approach to the design and application of the card and emphasised the need for consultation with prospective participants, their families and their support organisations.4

1.19 Dr Shelley Bielefeld noted in her submission:

There is slippage between ‘engagement’, ‘consultation’ and ‘information session’ in government documents accompanying the 2020 CDC Bill—yet an information session informing community members as to what the government is about to do to them is not a consultation in any meaningful sense.5

1.20 Many submitters highlighted that the absence of any real consultation with First Nations communities goes against the new National Agreement on Closing the Gap which has been founded on the principles of shared decision-making and self-determination.

1.21 National Aboriginal and Torres Strait Islander Legal Services (NATSILS) pointed out:

True partnership requires Aboriginal-led decision making, self-determination and free, prior and informed consent.6

1.22 NACCHO, Aboriginal Peak Organisations Northern Territory (APO NT), Aboriginal Medical Services Alliance Northern Territory (AMSANT), North Australian Aboriginal Justice Agency (NAAJA), NATSILS and Arnhem Land Progress Aboriginal Corporation (ALPA) all noted in their submissions that this bill is inconsistent with the new National Agreement on Closing the Gap.

1.23 As Professor Jon Altman noted in his submission:

Even before the ink is properly dry on this unprecedented agreement between all governments and a coalition of Aboriginal and Torres Strait Islander Peak Organisations, the Australian government as the key signatory is looking to unilaterally introduce laws that disempower rather than empower about 28 000 Indigenous Australians.7

1.24 Representatives from community groups, including the No Cashless Welfare Debit Card Australia and the Say NO Seven Community, provided evidence at

4 Australian Human Rights Commission, Submission 37, p. 6.

5 Dr Shelley Bielefeld, Professor Greg Marston, Dr Michelle Peterie and Dr Zoe Staines, Submission

118, p. 30.

6 National Aboriginal and Torres Strait Islander Legal Services, Submission 138, p. 7.

7 Emeritus Professor Jon Altman, Submission 106, p. 5.

40

the public hearing that they were not aware of any people currently on the CDC who had been consulted about making the trial sites permanent.8

1.25 The Australian Greens reject any proposition that genuine, two-way consultation has occurred with First Nations communities or anyone currently on the CDC about the proposal to make the scheme permanent.

Overwhelming opposition from First Nations groups 1.26 There is overwhelming opposition to the CDC and compulsory income management from First Nations groups. It appears from the evidence received by the committee that the Government has wilfully chosen to ignore this

critical opposition.

1.27 ALPA noted in its submission:

In every community in which ALPA discussed the potential expansion of the Cashless Debit Card the feedback has been universally consistent. People do not want the Cashless Debit Card, they do not feel that need or receive any benefit from Compulsory Income Management.9

1.28 Mr John Paterson, Chief Executive Officer of AMSANT, noted that the enormous consultation APO NT undertook with First Nations communities demonstrated that they do not want the CDC.10

1.29 If the Government had bothered to undertake genuine consultation with First Nations communities, they may have learnt about the concerns with introducing the CDC to the NT. This included issues around locking in food insecurity by removing people’s access to cash,11 increased demand for social security legal help,12 regular network outages and connectivity disruptions leading to people being unable to buy basic goods with the card,13 and increased need for financial services, banking services, financial counsellors and administrative support.14

8 Ms Amanda Smith, Policy Analyst and Campaign Coordinator, The Say NO Seven Community

and Ms Kathryn Wilkes, Main Administration Officer, No Cashless Welfare Debit Card Australia, Committee Hansard, 5 November 2020, p. 13.

9 Arnhem Land Progress Aboriginal Corporation, Submission 35, p. 4.

10 Mr John Paterson, Chief Executive Officer, Aboriginal Peak Organisations Northern Territory,

Committee Hansard, 5 November 2020, p. 5.

11 Aboriginal Medical Services Alliance Northern Territory, Submission 132, p. 4.

12 Aboriginal Peak Organisations Northern Territory, Submission 39, p. 9.

13 Aboriginal Medical Services Alliance Northern Territory, Submission 132, p. 4.

14 North Australian Aboriginal Justice Agency, Submission 134, p. 4.

41

Missing evaluation data 1.30 The Australian Greens are deeply concerned that the Government has decided to make compulsory income management permanent without all the available evaluation data.

1.31 The University of Adelaide Second Impact Evaluation, which was apparently designed to develop an evidence base and understand what works, has not yet been publicly released. It appears the Government is making the decision to entrench the CDC without considering all the available evidence. It is unclear whether this evaluation will be released before the bill is debated in the Senate.

1.32 The Government continues to rely on data from the widely debunked ORIMA evaluation to justify compulsory income management while ignoring other independent studies. For example, researchers from Monash University, University of South Australia and Menzies School of Public Health who undertook quantitative research at the Ceduna CDC trial site found that:

Across all measures we found NO IMPACT of the CDC. Meaning, neither a decrease nor an increase in measured crime rates, emergency department presentations, electronic gaming (pokies) nor apprehensions for public intoxication - Our analysis focused on the South Australian trial region (Ceduna and surrounds).15

1.33 As noted by the Human Rights Law Centre, the CDC has not been trialled in a location similar to the NT in terms of population size or geographical area.16 This raises questions about whether the Government has enough evidence to implement the CDC on a permanent basis in the NT.

1.34 The Australian Greens strongly believe there is not a sufficient evidence base to justify making the CDC permanent.

Cost of making the CDC permanent is unclear 1.35 There has been little to no transparency around the cost of the implementing and rolling out the CDC. The future outputs for the scheme are shrouded in secrecy and ‘commercial in confidence’ agreements with the cardholder,

Indue. The community only ever discovers the cost of the scheme after the fact.

1.36 This bill is no different. We have no understanding of how much it will cost to permanently entrench the CDC, lift the cap on the number of participants who enter the scheme, and roll it out to the NT.

1.37 This scheme goes to the broader question of a private company, in this case Indue, profiting from our social security system.

1.38 As the Human Rights Law Centre noted in its submission:

15 Monash University, Submission 5, p. 2.

16 Human Rights Law Centre, Submission 17, p. 2.

42

The permanent introduction of the Cashless Debit Card also paves the way for the Federal Government, and companies which profit from the scheme, to advocate for broader implementation of the card across Australia in the future.17

1.39 The Australian Unemployed Workers Union also highlighted:

The AUWU stands against the intrusion of the private sector in social welfare; the welfare of a population should not be turned into a profit-based market. Furthermore, the use of the private sector is another measure designed to reduce transparency and further enable the use of

public funds for private gain.18

1.40 The Australian Greens continue to oppose the role of private companies profiting from our social security system. Social security is an essential public good and must remain free from private corporations.

Power of Minister to increase quarantined income 1.41 The previous iteration of this bill allowed the Minister to quarantine 100 per cent of a person’s income support payment onto the CDC, leaving a person with no access to cash. While this bill has now lowered that figure to 80 per

cent, there is still widespread opposition to the Minister having such a broad power.

1.42 UnitingCare Australia expressed concerns around the lack of legislative safeguards in place to monitor this power and the implications this would have on how participants manage their personal finances.19

1.43 This bill maintains the same 50:50 quarantine ratio for people moving from the BasicsCard to the CDC. However, organisations like APONT and NAAJA noted there is no guarantee the Government will maintain the 50:50 quarantine ratio for people in the NT.20

1.44 The Australian Greens continue to hold concerns about this unnecessary and unchecked power and question the Government’s motives behind including this section in the bill.

Changes to the wellbeing exemptions and exit process 1.45 It is already incredibly difficult for people on the CDC to exit off the card. Changes introduced by this bill will make it even harder for people to get off the card.

17 Human Rights Law Centre, Submission 17, p. 2.

18 Australian Unemployed Workers Union, Submission 34, p. 3.

19 UnitingCare Australia, Submission 32, p. 21.

20 Aboriginal Peak Organisations Northern Territory, Submission 39, p. 12 and North Australian

Aboriginal Justice Agency, Submission 134, p. 3.

43

1.46 The Australian Greens are strongly concerned by the ability of the Secretary to revoke an exit or wellbeing exemption at any time. The retrospective application of this could mean exit approvals made prior to the passage of this bill could be revoked. We are concerned that people will live in constant threat of being put back on the CDC, permanently.

1.47 Change the Record noted this is disturbing as it implies a form of ongoing surveillance of an individual even after they have successfully exited the card.21

1.48 The Human Rights Law Centre noted the absence of any requirement for a state or territory government employee to give reasons or evidence when they request the Secretary to reconsider a person’s wellbeing exemption.22 This is extremely concerning.

Income Management in Cape York 1.49 This bill also transitions income management participants in Cape York to the CDC. It is important to note that the income management model applied in Cape York is very different to the way the BasicsCard operates in the NT and

the way the CDC operates across the current trial sites.

1.50 The model implemented through the Family Responsibilities Commission and its local commissioners is embedded in co-design and has strong community support.

1.51 Evidence provided to the inquiry by the Family Responsibilities Commission, Mrs Tammy Williams, emphasised that income management in Cape York is a measure of last resort.23

1.52 The Australian Greens note the broad community support for the implementation of income management through the Family Responsibilities Commission and the Commission’s calls for this scheme to continue in Cape York.

Recommendation 1

1.53 The Australian Greens recommend that the bill not be passed.

Recommendation 2

1.54 The Australian Greens recommend that all forms of compulsory income management currently operating in Australia should be abandoned.

21 Change the Record, Submission 24, p. 7.

22 Human Rights Law Centre, Submission 17, p. 3.

23 Mrs Tammy Williams, Commissioner, Family Responsibilities Commission, Committee Hansard,

5 November 2020, p. 22.

44

Recommendation 3

1.55 The Australian Greens recommend that the Government carries out extensive consultation around Australia for any move to make income management voluntary and ensure that any new program is co-designed.

Recommendation 4

1.56 The Australian Greens recommend that the Government consult immediately with communities in Cape York and the Family Responsibilities Commission on any further operation of the Cape York Scheme.

Senator Rachel Siewert Deputy Chair

45

Appendix 1

Submissions and additional information

Submissions 1 Fair Go for Pensioners Coalition 2 Consumer Action Law Centre 3 Australian Council of Trade Unions 4 St Vincent de Paul Society National Council 5 Monash University 6 Queensland Council of Social Service

 2 Attachments

7 Cape York Institute 8 The Say NO Seven 9 The Salvation Army Australia 10 Emerge Australia 11 Jesuit Social Services 12 Yamatji Marlpa Aboriginal Corporation 13 Australian Housing and Urban Research Institute 14 Per Capita Australia 15 Royal Australian and New Zealand College of Psychiatrists 16 Australian Women Against Violence Alliance 17 Human Rights Law Centre

 Attachment

18 No Cashless Welfare Debit Card Australia 19 Western Australian Council of Social Service 20 Josephite SA Reconciliation Circle

21 Public Health Association of Australia 22 Anglicare Australia 23 Council of Single Mothers and their Children 24 Change the Record 25 Wunan Foundation 26 Department of Social Services and Services Australia 27 ME/CFS Australia 28 Combined Pensioners and Superannuants Association 29 Economic Justice Australia 30 National Council of Women Australia 31 People with Disability Australia 32 UnitingCare Australia 33 Community and Public Sector Union 34 Australian Unemployed Workers' Union 35 Arnhem Land Progress Aboriginal Corporation

46

36 Anti-Discrimination Commission 37 Australian Human Rights Commission  3 Attachments

38 Generation One (Minderoo Foundation) 39 Aboriginal Peak Organisations of the Northern Territory 40 Concerned Constituents of Braddon Community 41 Family Responsibilities Commission 42 Mr Jim Epis, Shire of Leonora 43 Mr Samuel Horne

44 Name Withheld 45 Ms Chiquitita White 46 Name Withheld 47 Mr Brett Moore 48 Confidential 49 Name Withheld 50 Ms Laura Iseman 51 Name Withheld 52 Miss Kerri Shannon 53 Name Withheld 54 Name Withheld 55 Adjunct Professor Eva Cox AO 56 Mr Adrian Jackson OAM 57 Name Withheld 58 Ms Katherine Venes 59 Confidential 60 Centre for Excellence in Child and Family Welfare

 Attachment

61 Name Withheld 62 Name Withheld 63 Name Withheld 64 Name Withheld 65 Name Withheld 66 Name Withheld 67 Name Withheld 68 Name Withheld 69 Ms Gail Dew 70 Name Withheld 71 Name Withheld 72 Confidential 73 Name Withheld 74 Name Withheld 75 Name Withheld 76 Name Withheld

47

77 Name Withheld 78 Name Withheld 79 Name Withheld 80 Name Withheld 81 Name Withheld 82 Ms Pam Atkins 83 Name Withheld 84 Name Withheld 85 Ms Maria Walker

86 Ms Jo Schofield 87 Miss Tracey Hoolachan 88 Name Withheld 89 Name Withheld 90 Miss Josephine Perret 91 Northern Territory Government

92 Shire of Coolgardie 93 Name Withheld 94 Mr Allan Suter OAM 95 Ms Faye Whiffin 96 Name Withheld 97 Name Withheld 98 Name Withheld 99 Dr Elise Klein OAM 100 Ms Stella Bell 101 Dr Eve Vincent 102 Ms Jenny Cottle 103 Name Withheld 104 Name Withheld 105 Professor Tony Dreise, Dr Janet Hunt and Dr Francis Markham 106 Emeritus Professor Jon Altman 107 Name Withheld 108 Name Withheld 109 Name Withheld 110 Name Withheld 111 Name Withheld 112 Name Withheld 113 Name Withheld 114 Name Withheld 115 Mr Rodney Holmes 116 Name Withheld 117 Confidential 118 Dr Shelley Bielefeld, Professor Greg Marston, Dr Michelle Peterie and Dr Zoe

Staines

48

 3 Attachments

119 Professor Matthew Gray and Dr Rob Bray 120 Danila Dilba Health Service 121 Australian Association of Social Workers 122 Ms Jodie McNally 123 Name Withheld 124 Ms Judy Harrison 125 Brotherhood of St Laurence and FamilyCare

126 Northern Territory Legal Aid Commission  3 Attachments

127 Catholic Social Services Australia 128 Accountable Income Management Network  5 Attachments

129 Queensland Aboriginal and Islander Health Council 130 Australian Council of Social Service  3 Attachments

131 Northern Territory Council of Social Service 132 Aboriginal Medical Services Alliance Northern Territory 133 Baabayn Aboriginal Corporation; Caritas Australia; Djilpin Arts Aboriginal Corporation; Kinchela Boys Home Aboriginal Corporation; National

Aboriginal and Torres Strait Islander Catholic Council; and Red Dust Healing 134 North Australian Aboriginal Justice Agency  Attachment

135 National Aboriginal Community Controlled Health Organisation 136 Ngaanyatjarra Council (Aboriginal Corporation) 137 Law Council of Australia 138 National Aboriginal and Torres Strait Islander Legal Services

 Attachment

139 Name Withheld 140 Ms Roz Pearson 141 Name Withheld 142 Name Withheld 143 Ms Catherine Eldridge 144 Name Withheld 145 Northern Land Council

Additional Information 1 Opening comments to Senate Standing Committee on Legal and Constitutional Affairs Inquiry into the Provisions of the Northern Territory Emergency Response Bill 2007 and Associated Bills, 10 August 2007, from Professor Jon

Altman, received 5 November 2020

49

2 ASIC Regulatory Guide 201, Unsolicited credit cards and debit cards, July 2010, from Professor Jon Altman, received 5 November 2020 3 ASIC Report 483, Overview of decisions on relief applications (October 2015 to March 2016), June 2016, from Professor Jon Altman, received 5 November 2020 4 Helping or Harming? Compulsory Income Management in Australia and New

Zealand, Summary Report, from Professor Jon Altman, received 5 November 2020

Answer to Question on Notice 1 Answers to Questions taken on Notice during 5 November public hearing, received from Family Responsibilities Commission, 6 November 2020 2 Answers to Questions taken on Notice during 5 November public hearing,

received from Generation One (Minderoo Foundation), 11 November 2020 3 Answers to written Questions taken on Notice, received from Department of Social Services, 12 November 2020

Correspondence 1 Correspondence, received from Australian Council of Social Service, 10 November 2020

Tabled Documents 1 Opening statement, tabled by The Say NO Seven Community, at Canberra public hearing, 5 November 2020 2 Opening statement, tabled by Family Responsibilities Commission, at

Canberra public hearing, 5 November 2020

51

Appendix 2 Public hearings

Thursday, 5 November 2020 Main Committee Room Parliament House Canberra

Professor Jon Altman, Private capacity

Professor Tony Dreise, Private capacity

Dr Janet Hunt, Private capacity

Dr Francis Markham, Private capacity

Aboriginal Peak Organisations of the Northern Territory  Mr John Paterson, Chief Executive Officer  Ms Theresa Roe, Network Co-ordinator

The Salvation Army  Mr Stuart Foster, General Manager, Community Services  Ms Jennifer Kirkaldy, General Manager Policy and Advocacy

The Say NO Seven Community  Ms Amanda Smith, Policy Analyst and Campaign Coordinator

No Cashless Welfare Debit Card Australia  Kathryn Wilkes, Main Admin

National Council of Women Australia  Robyn Nolan, President

Family Responsibilities Commission  Mrs Maxine Mcleod, Registrar  Mrs Tammy Williams, Commissioner  Ms Tracey Paterson, Executive Officer (Finance)

Cape York Institute  Ms Prue Briggs, Head of Policy

Minderoo Foundation  Ms Shelley Cable, Chief Executive Officer, Generation One  Mr Bruce Mansfield, Strategic Advisor

52

Wunan  Mr Ian Trust, Executive Chair  Mr James Elliott, Board Member