Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Hansard source

This is a very important piece of legislation and I know that is appreciated by all colleagues in this place. I thank them for their contributions not only to this debate but also to the Senate committee process that has looked at the legislation. I particularly acknowledge at the outset the incredible work of Mr Alan Tudge, the Assistant Minister to the Prime Minister and also Assistant Minister for Social Services, for whom this has been an area of great interest not just professionally in his ministerial capacity but also in his previous role as deputy director of the Cape York institute as Noel Pearson's deputy.

This bill when enacted will enable a trial phase of new cashless welfare arrangements and a cashless debit card. 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. This is an important social reform and, importantly, it is one that the community is calling for. Excessive alcohol consumption, drug use and gambling are—as you know, Mr President, from your previous incarnation as a senior police officer—harmful and costly to the broader community and are a cause of health problems, high crime rates, domestic and community violence, family breakdown and social dysfunction. Alcohol-related harm results in 3,000 deaths and 65,000 hospitalisations every year in Australia. The total cost of alcohol-related problems in the nation is estimated to be between $15 billion and $31 billion per year. Problem gambling is associated with a range of health, social and economic problems. Problem gambling costs the Australian community an estimated $4.7 billion per year, and individuals with gambling problems lose, on average, $21,000 per year—a third of the average Australian salary. These are significant social issues.

The trial will be conducted in up to three locations and will be limited to 10,000 people. Trial locations will be selected on the basis of high levels of welfare dependence and where gambling, alcohol and illegal drug abuse are causing unacceptable levels of harm. Community interest and willingness to participate will also be a factor.

We have undertaken an extensive community consultation process. Consultations to date have included community leaders, proposed trial participants, state and local governments, industry, merchants and welfare groups. These genuine community consultations are enabling a better understanding of local needs and help to gauge the interest in a trial in several communities. The consultation process has provided government with valuable feedback and insight into the issues these communities face.

Ceduna in South Australia will be the first site under the trial to commence. Ceduna signed an MOU with the government on 4 August to participate in the trial, and the leadership in the community have publicly called for this trial and see it as a mechanism to address some of the welfare-fuelled alcohol and drug abuse that is devastating the community.

In Ceduna the statistics are pretty stark. In 2013-14, presentations to the hospital emergency department due to alcohol or drug use exceeded 500—that is more than one per day. The local sobering-up facility had a staggering 4,667 admissions that same year from a regional population of 4,425. The Ceduna community heads group, a key leadership group in the community, had 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.

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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.

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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 Junior of the MG Corporation and Desmond Hill of the Gelganyem Trust see the trial as a worthy idea to address many social issues facing their communities. The three leaders 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 40 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.' The leaders also urged federal members of parliament from all sides to: 'Listen to us on this matter and take a non-partisan position in order to allow this trial to proceed. We believe that this trial could be the catalyst for breaking the cycle of poverty and despair in the East Kimberley.'

When local leaders stand up and call for reform, parliamentarians should listen and respond, and that is what we are seeking to do here. The community harm statistics from the East Kimberley are also shocking. In a place such as Kununurra, the hospitalisation rate from assaults is 68 times the national average.

To effectively test whether a reduction in cash leads to a reduction in harm, 80 per cent of payments received by all people in the community receiving a working-age welfare payment such as Newstart allowance will be placed on the cashless debit card. The trial aims to support income-support recipients and is not Indigenous-specific. People who receive the age pension and veterans pension will not automatically be placed on the trial; however, they will be able to volunteer to participate in the trial if they wish.

Recognising that we do not live in a cashless society and that people need cash for minor expenses such as children's lunch money or bus fares, the remaining 20 per cent of the payments will be available for use at the person's discretion. The figure of 20 per cent cash was decided through consultation with communities.

The cashless debit card will work as similarly as possible to any other bank card. The card will work at all shops except those selling alcohol and gambling products. The only difference between this card and any other bank product is that it will not support cash withdrawals or allow the purchase of those products contributing to community harm. Restrictions on the withdrawal of cash will also help combat expenditure of welfare dollars on illicit drugs like ice which we know are devastating many communities across the nation. Participants in the trial will automatically receive an everyday mainstream debit card. Participants will have access to online banking, a mobile app and a customer call centre; this will give participants easy access to their bank balance and transaction histories and a simple way to report lost or stolen cards.

Participants will also have the option of receiving SMS alerts or mobile phone push alerts. These alerts will notify participants when money is received in their account, provide an updated balance after purchases over a particular amount and warn participants when their bank balance is getting low. All of these services will be available at no cost to the participants.

Community education workshops will be held before the trial commences in each location. At these workshops participants will be provided with information on how the card will work and how to use online services. These workshops will ensure participants are supported during transition to the trial. Because the card will work everywhere except at shops selling alcohol or gambling products, most merchants will not have to do anything to accept the new card. Retail staff will not require any additional training, and there will be no extra paperwork. If there is a business that sells alcohol or gambling products as well as other goods, they may still be able to enter into a contract to accept the card. This will involve agreeing to ensure their customers cannot use the card to buy these products. If a business only sells alcohol or gambling goods and services such as poker machines, sports wagering, keno and casino games, they will not be able to take part in the trial.

Government and the cashless card provider will work closely with merchants prior to and during trial implementation to ensure a smooth transition to the trials for merchants. The bill also empowers the minister to authorise 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. It also supports community autonomy and reinforces that the trial is being community led.

An evaluation of the trial will be undertaken. The evaluation will contribute to a robust knowledge base and will explore the impact on levels of community harm following implementation of the trial. The evaluation will also canvas the opinions of trial participants, service providers and individuals in the community in order to develop our understanding of the influence of the trial on broader community functioning. Findings from the trial will make a vital contribution to future options for reducing community harm and dysfunction exacerbated by welfare fuelled alcohol and drug abuse at both individual and community levels.

The income management program and the BasicsCard in place across a range of locations throughout the nation is another valuable tool which helps to support individuals and families. It will continue for an additional two years, maintaining support for vulnerable people. Income management and the trial, however, 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 people are safer; less money is spent on alcohol, gambling and illicit drugs; and more money is available to support children and families. This trial has the support of communities which are desperate to try to curb the impact of alcohol and drug fuelled violence. For these reasons the government is very strongly of the view that it is a concept worth trialling. I think there is broad support for this concept around this chamber. I think colleagues around the chamber know that that which has been done before has not worked. We know what the outcomes will be if we just continue more of the same. It is important that we do test and trial another approach. I commend the bill to my colleagues.