Dan Tehan (Wannon, Liberal Party, Minister for Social Services) Share this | Hansard source

I move:

That this bill be now read a second time.

This bill will extend the Cashless Debit Card trial to the Bundaberg and Hervey Bay area and outlines the conditions for this trial.

In line with this government's announcement on 21 September 2017, the Bundaberg and Hervey Bay area will be the fourth cashless debit card site nationally.

The government is committed to reducing the social harm caused by alcohol, drug abuse and gambling in areas with high levels of welfare dependency.

The cashless debit card operates like an ordinary debit card but aims to reduce the effects of alcohol, drug and gambling abuse by both limiting the availability of cash and limiting the items that can be purchased.

The card is already operating in three sites;

In Ceduna and East Kimberley the card has been in operation for over two years. In the Goldfields, the card is still being rolled out.

The independent evaluation into the effectiveness of the card has shown 'considerable positive impact' in communities, including:

This is in addition to the anecdotal evidence provided in each site that has seen a direct impact on the communities.

The bill will allow the cashless debit card to be rolled out to a fourth site, the Bundaberg and Hervey Bay area in Queensland, from later this year. The cashless debit card will operate in Bundaberg and Hervey Bay until 30 June 2020. This will allow time to rollout the program in this area, and allow it to operate for a minimum of 12 months.

The bill updates the current limitations on the number of participants from 10,000 to 15,000, recognising the increase that would come from implementing the cashless debit card to this area. Like the current trial sites, the bill introduces provisions that allow merchants to block restricted goods at the point of sale.

For the purposes of the bill, the Bundaberg and Hervey Bay area has been defined as the federal electoral division of Hinkler, in line with the electoral boundaries as at 31 May 2018.

The bill seeks to have the criteria for trial participants in the Bundaberg and Hervey Bay site outlined in the legislation. Those persons living in this area aged under 36 years of age, and receiving Newstart allowance, youth allowance (jobseeker), parenting payment (single) or parenting payment (partnered) would be transitioned onto the cashless debit card.

It will not be rolled out to any individual on the age pension.

This would impact around 6,700 people, and represents a more targeted approach to the one taken in Ceduna in South Australia and the East Kimberley and Goldfields in Western Australia. If passed, it will be the largest of all the card trial sites.

Expansion of the cashless debit card under these criteria will allow the effectiveness of the program to be further tested and understood in the context of a larger urban population. It is also an opportunity to test the technology in a more diverse community. This area has a significantly different demographic than other sites currently operating.

The bill also specifies that for the Bundaberg and Hervey Bay trial site welfare recipients that are not included as trial participants may not volunteer for the cashless debit card.

This will allow the government to test the impacts of the cashless debit card trial exclusively for the selected group, as has been asked for by the community.

The criteria for trial participants also sets out some exceptions where a person would not be transitioned onto the card, drawing on policy parameters used in existing sites.

This includes a provision for the secretary to exempt a person where inclusion in the trial would pose a serious risk to the person's mental, physical or emotional wellbeing.

These exemptions and discretionary powers will be used to ensure vulnerable people are not adversely affected by the trial.

The selection of the cohort in this area has occurred as a result of significant consultation with the community. This is designed to help address key social problems that local people have identified during meetings, in particular high youth unemployment, intergenerational welfare dependence and local children whose needs are not being met.

According to regional youth unemployment data from March 2018, these communities have a youth unemployment rate of 28.7 per cent, an increase of four per cent since last year. This compares to the state average of 13.4 per cent.

Bundaberg and Hervey Bay has a high level of long-term and intergenerational welfare dependency. Children born to parents who are welfare dependent are more likely to become welfare dependent themselves.

Ninety per cent of the people in Bundaberg and Hervey Bay under 30 and on Newstart or youth allowance had a parent or guardian who received income support at some point in the last 15 years.

Of that cohort, around 13 per cent had a parent or guardian who received income support at least once each year for the past 15 years.

Findings by the Australian Research Council indicate that risk factors such as attitudes to work and welfare, attitudes towards alcohol and drug consumption and family influences contribute to intergenerational welfare dependency.

The council also found evidence that young people from welfare dependent families are more likely to smoke, drink alcohol or consume illegal drugs, highlighting the relationship that welfare dependence has on a young person's outcomes in life.

On average across Australia, 46 per cent of people attending government-funded financial counselling for their problem gambling were also receiving a taxpayer-funded benefit. In the Bundaberg and Hervey Bay area, it is 73 per cent.

Additionally, people attending financial counselling for their problem gambling in the Bundaberg and Hervey Bay area are more likely to have been on their current benefit for longer than 5 years, compared to other people in Australia attending problem gambling counselling.

The cashless debit card could help to stabilise the lives of young people in the area by limiting spending on alcohol, drugs and gambling, thus improving their chances of finding employment or successfully completing education or training.

By targeting a younger cohort, we can influence positive behaviour change before welfare dependency becomes entrenched in a person's lifestyle.

We have seen that a 'spillover' benefit of the card is that it can increase motivation to find work. As part of the final evaluation report of the cashless debit card trial, we received feedback from some card participants in September 2017 that almost a quarter of people on the card are spending several hours a week looking for work. This is an increase from 11 per cent in February 2017.

As I have previously stated, the Department of Social Services has undertaken significant consultations with key stakeholders and community members. Specifically, between May and December 2017, over 188 meetings, including three community information sessions, were held across the Bundaberg and Hervey Bay area.

A Community Reference Group was established in late 2017 to work through local policy and implementation issues to ensure the cashless debit card is implemented effectively in their community.

Additionally, a local shopfront will be established with staff who could link people with existing services.

Through the Community Reference Group, the department will monitor service demand to ensure the cashless debit card is complemented by appropriate supports for people as they adjust to this change.

Complementing the card will be a further investment in community services of $1 million. There are already a significant number of services in place, including 70 federally funded services across the area, which includes drug and alcohol services, financial capability services, employment and families' and children's programs.

The bill will allow the program to respond to unforeseeable circumstances, such as wide-scale power outages and natural disasters, allowing trial participants in Bundaberg and Hervey Bay to access their full payment as cash.

This measure will ensure participants and their families remain supported in the event of wide-scale emergencies.

The Bill will also allow the option of establishing a community panel in the Bundaberg and Hervey Bay area to allow participants in the area to apply to have access to a higher portion of unrestricted funds.

Consultations with community leaders in the area have indicated that a panel will be useful to make the trial flexible to the needs of their community.

The government has also announced a second evaluation of the cashless debit card across all three current trial sites, to assess the ongoing effectiveness of the program.

The second evaluation will use research methodologies developed independently by the University of Queensland, and draw on the baseline measurements of social conditions in the Goldfields, developed by the University of Adelaide. Findings from the second evaluation will be published in late 2019.

Should this bill pass, the government will also evaluate the card's operation in Hervey Bay and Bundaberg.

To support the cashless debit card trial, this bill will strengthen the provisions that enable merchants to block the sale of restricted goods to trial participants at the point of sale.

Merchants in trial sites will more readily be able to service participants of the program, through the option to implement product level blocking solutions, automatically blocking transactions where a participant is attempting to purchase restricted goods with the card.

In doing so, the bill also clarifies the restriction on 'cash-like' products, such as gift cards, vouchers, money orders, or digital currency, where these could be used to purchase alcohol and gambling products.

These products are included as restricted goods, as has always been the intention of the program. Clarifying this provision to include 'cash-like' products will support product-level blocking amendments, and help prevent participants from circumventing the program and spending their welfare payments on alcohol, gambling and drugs.

The cashless debit card is a world first in how it operates. The evaluation has been conducted and it has been shown to work. Consultation in the Bundaberg and Hervey Bay area demonstrates it needs a way to break the cycle of welfare dependency, and help people manage their income and stabilise their lives.

I ask the parliament to back this trial for Hervey Bay and Bundaberg, to provide the community a trial that they have asked for.

Debate adjourned.

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