Jenny McAllister (NSW, Australian Labor Party, Shadow Assistant Minister for Families and Communities) Share this | Hansard source

I rise to speak on the Social Services Legislation Amendment (Cashless Debit Card Trial Expansion) Bill 2018. This bill proposes to extend the cashless debit card trial to Bundaberg and Hervey Bay. If this bill is successful, all recipients of Newstart, youth allowance and parenting payment in the electorate of Hinkler who are under 36 will be forced to become trial participants. The cashless debit card quarantines 80 per cent of an income support payment onto a special debit card which cannot be used to purchase alcohol, to gamble or to buy gift cards which could in turn be used to purchase alcohol or gamble. It's expected that about 6,700 people in Bundaberg and Hervey Bay would become trial participants.

Labor do not support this bill. As we have said many times now, Labor support genuinely community-driven initiatives to tackle drug and alcohol abuse. We believe they must be genuinely community driven, not top down. Labor do not believe in a blanket approach to income management. We do not support a national rollout of the cashless debit card. We understand that the vast majority of income support recipients are more than capable of managing their own finances. We understand that, for many people, indeed most people, income management simply isn't necessary. We've said all along that we will talk to individual communities, and that we will make decisions on a location-by-location basis.

The evidence presented to the Senate inquiry and the feedback from the people in Bundaberg is very clear: the community in Bundaberg do not want to trial the cashless debit card in their town, full stop. The mayors in both the local government areas in the trial region, Bundaberg and the Fraser Coast shire, oppose the introduction of the cashless debit card in Bundaberg and Hervey Bay. The mayor of Bundaberg, a former LNP stalwart and Queensland state minister, Jack Dempsey, says his community has turned against the cashless debit trial after learning of the cost. Key groups from Bundaberg said they felt ignored by government's consultation process on this issue. Representatives from the Gidarjil Development Corporation explained:

Gidarjil is probably considered the largest Indigenous organisation in Bundaberg, and there hasn't been any approach from the federal minister in regard to this or in fact anything.

Representatives from a community advocacy group in Bundaberg explained to a Senate inquiry:

… there has been little to no public consultation. What has taken place has been behind closed doors …

Labor will consider the introduction of a new trial site only if the Liberals can show that they have an agreed formal consultation process, which includes an agreed definition of community consent, with the community. The Senate inquiry into this bill exposed the serious lack of meaningful consultation with local communities, and the anxiety of the residents who would become trial participants, about the impact that the trial would have on their budget and their ability to meet existing ongoing financial obligations. They also raised concerns about their access to lower-cost options for food, clothing and other essentials which are available only with cash. The third thing canvassed by the Senate inquiry was the lack of sufficient evidence to demonstrate that these trials effectively deliver positive outcomes for communities.

Perhaps the most damning element in all of this—and it has been canvassed in other debates in this place in the last fortnight—is the lack of robust evidence. The government's own evaluation conducted by ORIMA into the effectiveness of the existing trials in Ceduna and the East Kimberley is utterly inconclusive at best. The evaluation has been criticised by leading academics, and there is insufficient credible evidence at this point to support the establishment of further trials. Janet Hunt, the deputy director at the Centre for Aboriginal Economic Policy Research at ANU, said that the evaluation showed that the cashless debit card had not actually improved safety and reduced violence, despite that being one of the trial's key objectives. She's very critical of the methodology used by ORIMA to conduct the evaluation. She argues:

People interviewed for the evaluation reported that they drank less than before the trial began. However, such recall over a year is not likely to be very reliable. And, because respondents had to give their ID to the interviewer, they may have said exactly what they thought the interviewer wanted to hear, and certainly would not have incriminated themselves …

This is particularly true for Aboriginal people, who, for historical reasons, are likely to view authority figures with deep suspicion. Last year the former Minister for Human Services described the cashless debit card trials as a huge success. The Prime Minister himself asserted:

It's seen a massive reduction in alcohol abuse, in drug abuse, in domestic violence, in violence generally …

But Janet Hunt made it absolutely clear that this is not the case, and she said:

Someone needs to tell them that the report does not say that.

This is hugely important. The government's argument for expanding the rollout of this card rests very heavily indeed on this evaluation, and when participants were asked about the impact of the trial on their children's lives only 17 per cent reported feeling that their children's lives were better as a result. The ORIMA evaluation was substandard. We don't believe that any government should be making significant policy decisions off the back of such a poor-quality evaluation. Labor will only consider the further expansion of cashless debit card trial sites when there is much greater evidence, and credible evidence, of the card's effectiveness.

These same concerns were confirmed last month by the Auditor-General. His report indicated very real problems not just with the evaluation but with the rollout of the trial more generally, including the very high cost of the trials, budget overruns and flawed procurement processes. The report exposed not simply a flawed method of evaluation but also findings in that evaluation that were either unsubstantiated or false. For example, the government's evaluation said there was a decrease in ambulance callouts, but the ANAO found there had been an increase. The government's evaluation said there was an increase in school attendance, but the ANAO found Indigenous school attendance had decreased after the introduction of the card. The report also found that the trial ran over cost and that there were less-than-robust procurement processes. The ANAO has completely undermined and discredited the government's claim that there is evidence that this policy is working. I want to quote from the report. It says:

… monitoring and evaluation was inadequate. As a consequence, it is difficult to conclude whether there had been a reduction in social harm and whether the card was a lower cost welfare quarantining approach.

What a joke! The entire point of having a trial is to generate an evidence base on the basis of which decisions can be made, yet this evaluation has been botched from the very beginning.

I want to turn to the cost, because the cost of the rollout of the cashless debit card is a further important consideration in the debate. What do we know? We know that the government has already paid $7.9 million of that to the debit card provider, Indue, and almost $1.6 million to ORIMA Research to provide a poor-quality evaluation. We understand that the current accrued cost of the cashless debit card trial is around $24 million for just two sites to 15 March this year. What it means, practically, is that the cost per head of the trial across the two sites is well over $10,000.

It is extraordinary that we debate this legislation today without any indication from the minister about how much it will cost taxpayers to roll out the card at Bundaberg and Hervey Bay. Budget emergency? Not, apparently, when it comes to pursuing ideological preoccupations. In fact, the government still hasn't revealed how much the trial at the Goldfields is costing, despite the fact that the trial has been operating there since early May. Perhaps it has something to do with the fact that a local council in Bundaberg did a survey that showed that, when locals were told how much the trial program would cost to administer, support for the trial in the community dropped to just 26 per cent. The government are deliberately avoiding telling us the cost per head for political reasons, and that is simply unacceptable. We are committed to dealing with the evidence, but you must present an evidence base, including the cost-effectiveness of the approach that you are recommending. The government needs to say how much the trial at Bundaberg and Hervey Bay will cost, and it needs to say what the cost of the existing trial is in the Goldfields in WA.

The committee inquiry also heard a lot of evidence about the personal and negative impact that these trials would have on participants. Prospective participants talked about the importance of being able to make certain payments by direct debt and the fact that this card would not allow or accept direct debit. Some of them were concerned it would deprive them of a car, because car financing often requires a minimum direct debit payment. Participants were concerned about the ability to purchase fresh food and groceries, because it is often the case that roadside fruit and vegetable stalls only accept cash, and they are very cost-effective options for people in regional areas. DSS in their evidence explained that people would have to apply to the department for a regular transfer of cash to meet regular direct debit payments for approved items such as car repayments. Cash plays a vital role in the local economy. Restricting the access of people in this area to cash could jeopardise their ability to participate in that community. That's especially the case for low-income community members, who often use cash to access cheaper goods and services, including second-hand goods.

Residents in Bundaberg and Hervey Bay, as I have already mentioned, did not believe that adequate consultation had taken place. As far as we're aware, the local federal MP has failed to hold any kind of consultation, and when DSS did so community members said it was less of a consultation and more of a case of attendees being told that the debit card was coming, irrespective of their views. There's a key distinction between briefing people about what is about to happen to them and genuinely consulting and engaging people with their perception of problems and their perception of solutions that may work in response to problems. That is what community engagement means. It's not a series of PowerPoint slides flashed up with a bureaucrat standing out the front.

We supported the initiation of trials in Ceduna and East Kimberley. We support them continuing until to mid-2019 to allow more time to reliably determine whether they have been successful. It is predicated on community involvement. In April last year, the then shadow minister for social services, Jenny Macklin, and the then shadow minister for human services, Linda Burney, went to East Kimberley to meet with community leaders in Kununurra and Wyndham. The feedback they received in East Kimberley, if we're honest, was mixed. Some people were in favour of the card, others were very strongly opposed and many people thought the card was just worth trialling—willing to give it a shot. The common sentiment that Labor heard was that things are so bad in the local community that people are willing to give anything a go. Essentially they support the cashless debit card not out of hope but out of despair.

We take a very clear-eyed view of this issue. We're not being ideological in our approach. We have a guiding set of principles founded on the notion of community consent and evidence, and that determines our position in this debate. We don't support the bill. We don't support the expansion of the card to Bundaberg and Hervey Bay. The evidence presented to the Senate inquiry as well as our own conversations show that people in the community of Bundaberg do not want to trial the cashless debit card in their town. Mayors of both local government areas in the trial region, Bundaberg and Fraser Coast, publicly oppose the introduction of the cashless debit card in Bundaberg and Hervey Bay. The ORIMA evaluation into the effectiveness of the existing trials, which the government relies on heavily in their arguments, has been slammed by the Auditor-General as inconclusive.

The government is unable to produce evidence of community consent and engagement. It is unable to produce robust evidence that the existing trials are working. In that context, further trials simply cannot be justified. Clear and credible evidence is needed before any decision can be made about the expansion of the current cashless debit card trial to any other areas. We will consider the introduction of a new trial site only if the government can show that they have an agreed formal consultation process with the community as well as an agreed definition of consent. We oppose the bill, and we encourage other senators to do the same.