Alan Tudge (Aston, Liberal Party, Parliamentary Secretary to the Prime Minister) Share this | Hansard source

I move:

That this bill be now read a second time.

This bill will enable a trial phase of new cashless welfare arrangements and a cashless debit card, in response to a key recommendation from Mr Andrew Forrest's Review of Indigenous Jobs and Training.

The cashless debit card is an important recommendation in the Forrest Review report, Creating Parity, as a means of reducing the social harm caused by welfare-fuelled alcohol, gambling and drug abuse.

The main objective of the trial is to test whether restricting discretionary cash can reduce the overall social harm which is caused by welfare-fuelled alcohol, gambling and drug abuse, particularly against women and children.

The trial will be conducted in up to three locations, and will be limited to 10,000 people. The locations will be selected on the basis of high levels of welfare dependence, where gambling, alcohol and illegal drug abuse are causing unacceptable levels of harm and there is an openness to participate from within the community.

Ceduna in South Australia will be the first site under the trial to commence. The leadership in the community have publicly called for this reform and see it as a mechanism to potentially address some of the welfare-fuelled alcohol and drug abuse that affects the community.

On the day the government announced it would like to proceed with Ceduna as a trial site for the cashless debit card, the Ceduna Community Heads Group—a key leadership group in the community of Ceduna—endorsed the reform and said:

We want to build a future for our younger generation to aspire to and believe we cannot do this if our families are caught up in the destructive cycle of alcohol or drugs that destroys our culture, our lands and our communities.

At the heart of this reform is a change that is being shaped specifically to meet our local needs. It has been a true collaboration to ensure that we can give our mob and our Communities every chance to create real and genuine change in their lives.

We have grasped this initiative; we have helped shape this initiative; and we are confident that this initiative is for the betterment of all people within our region.

We are also in advanced discussions with the leaders in the East Kimberley region. Key leaders in the region, led by Ian Trust of the Wunan Foundation, Ted Hall Jr of the MG Corporation and Desmond Hill of Gelganyem Trust, see the trial as a worthy idea to address many social issues facing their communities. The three men wrote to the government saying:

We acknowledge that agreeing to the East Kimberley being a trial site for the restricted debit card may seem to some a rather drastic step. However, it is our view that continuing to deliver the same programs we have delivered for the past forty years will do nothing for our people and, besides wasting more time and money, will condemn our children and future generations to a life of poverty and despair. As leaders in the East Kimberley, we cannot accept this.

When key local leaders of the stature of these people stand up and call for reform, parliaments should listen, and that is what we are doing.

Under the trial, 80 per cent of payments received by people on a working age welfare payment, such as Newstart Allowance, will be placed on the cashless debit card.

Participants in the trial will receive an everyday mainstream debit card, which will be connected to the Visa, MasterCard or EFTPOS platform.

A person will not be able to use this card to access cash or use it at liquor and gambling outlets. Because cash will be limited, the ability to purchase illegal drugs will be restricted as well.

Recognising that we do not live in a cashless society and that people need cash for minor expenses such as children's lunch money, the local footy or bus fares, the remaining 20 per cent of payments will be available for use at the person's discretion. The 20 per cent cash ration is supported by the Ceduna community.

In trial locations, the cashless debit card will work as similarly as possible to any other bank card. The trial will seek to ensure the card can work at all existing terminals and shops, except those selling the restricted products of alcohol and gambling, as well as online where possible. The only difference will be that it will not allow the purchase of alcohol and gambling products or allow cash withdrawals.

The bill also empowers the minister to authorise local community bodies in trial locations. An authorised community body will be able to reduce the percentage of a person's welfare payment that is placed on the cashless debit card. This recognises that the community has an important role to play in the trial and in encouraging socially responsible behaviour.

The trial, expected to start in the first quarter of 2016, will make a vital contribution towards informing potential future arrangements for income management, aimed at reducing social harm caused by welfare fuelled alcohol abuse and drug abuse, especially against women and children.

Income management and the BasicsCard will continue for two additional years to maintain support for existing income management participants while the trial is running. The Social Services Legislation Amendment (No. 2) Bill 2015, introduced on 28 May 2015, will make a number of changes to streamline the income management program to enable more effective operation of the program. Income management and the trial will not be run in the same locations. In Ceduna, and any other trial site that is an existing income management location, income management will be switched off before the trial starts.

We acknowledge that, for some people, using a debit card rather than cash to pay for everyday items will be an initial inconvenience. We do not underplay that. However, the potential upside is a transformed community where women are safer, less money is spent on alcohol and gambling, and more money is available for children's needs.

We think, for this reason, this is an opportunity worth trialling.

Debate adjourned.

See this speech in context