Carol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Link to this | Hansard source

I rise to speak on the Social Security Legislation Amendment (Debit Card Trial) Bill 2015. The bill seeks to amend the social security law to enable a trial phase of new cashless welfare arrangements in response to the 'healthy welfare card' recommendation from Mr Andrew Forrest's review of Indigenous jobs and training.

The trial is proposed to be conducted in three locations, involving up to 10,000 people. Locations will be selected on the basis of high levels of welfare dependence; where gambling, alcohol and/or drug abuse are causing unacceptable levels of harm within the community; and where there is a level of community support. The participants in this trial are people who reside in the trial locations and who are on working age payments, including Newstart, disability support and carer payments. Age pensioners and wage earners can volunteer.

In rising to speak on this bill I acknowledge the significant harm caused by alcohol abuse and the related violence. The Community Affairs Legislation Committee inquiry into this bill heard from residents about the devastating impacts that alcohol abuse and violence have in communities across Australia, in particular the committee heard about the destructive impact they have on Ceduna, the first trial site for this initiative, and the surrounding communities.

I had the pleasure yesterday of having a delegation from Ceduna come and meet with me to talk about this piece of legislation. Labor understands the need to take action to address these problems. However, in seeking to do so, this debit card legislation should not be rushed or avoid proper scrutiny. Indeed, the Labor senators' report from the Community Affairs Legislation Committee goes to this very point. The proposed trial will have significant implications for the lives of those living in the trial sites and, if it is planned and implemented well, these implications will be positive. However, if the proposed trial is rushed and implemented without the appropriate supports, the trial will not only likely fail but will also have a negative impact on people's lives. Unfortunately, this is what Mr Tudge has sought to do. The bill was introduced without important details being worked out, and we heard that concern in some of the contributions to this bill by other senators yesterday. This concern was evident throughout the Senate committee inquiry process, with the department being unable to explain crucial details about the trial, particularly the supports that would accompany this.

Rushing proper consideration of this legislation and its impacts is nothing more than irresponsible and could potentially undermine the very outcomes that the trail seeks to achieve. I acknowledge that Mr Tudge has provided further detail about the trial in a letter to our shadow ministers, Jenny Macklin and Shane Neumann. However, significant issues remain unresolved. In fact, this additional information was provided by Mr Tudge only on Sunday afternoon and only after the shadow ministers wrote to him expressing Labor's concerns. Mr Tudge used his response as an opportunity to attack Labor and question our commitment to supporting community leaders to respond to the harm caused by alcohol in their communities. Mr Tudge must realise that this is not about playing politics, it is not about scoring cheap shots; this is about making long-term change. This type of long-term change will be possible only if this trial is implemented properly, and this can happen only through proper consideration of the debit card trial legislation and its implications.

Labor will not be badgered into rushing its consideration of the legislation. Labor wants to ensure that the debit card trial achieves the best outcomes for participating communities, and this will happen only if we properly consider the proposal. The proposal in the bill stems from the healthy welfare card recommendation from Mr Andrew Forrest's review of Indigenous jobs and training. The trial, which has been designed in response to the report's recommendations and would be established through this bill, intends to test whether significantly reducing access to cash can reduce the habitual abuse and associated harm from alcohol, gambling and illegal drugs. Under the trial, access to cash for income support recipients would be limited by placing a significant proportion of a person's welfare payments into a restricted bank account. The bill will also enable a community body to be involved in determining welfare arrangements within a trial location. We note that the bill does not include where these locations will be and that, instead, these trial areas will be specified later through legislative instrument. We do know, however, that the bill allows the trial to be conducted in up to three locations for up to 10,000 people.

As my colleagues have mentioned, a memorandum of understanding has already been signed for Ceduna and the surrounding area to be the first trial location. The trial sites are to be determined on the basis of need—selected on the basis of high levels of welfare dependence, where gambling, alcohol and drug abuse are causing unacceptable levels of harm within the community. The bill establishes that in these locations 80 per cent of regular payments and 100 per cent of lump sum payments received by people on a working-age income support payment will be placed in a restricted bank account. The remaining 20 per cent of payments will be put in the bank account of the recipient's choice. This money will be available for use at the individual's discretion. Trial participants will include people in receipt of Newstart allowance, parenting payment, disability support pension and carer payment. Age pension recipients will not be part of the trial automatically, but they could volunteer to be included. A trial participant will not be able to use the debit card linked to the restricted account to access cash or purchase gambling products and services, alcohol or illegal drugs.

I think it is important to note that the new debit card arrangements are very different from the income management program. Unlike with income management, participants on the new debit card will receive no assistance from Centrelink workers with budgeting and to make sure that the income support payments are directed to life's essentials, like rent, food and items of clothing. The new debit card will ensure only that the majority of income support payments cannot be spent on alcohol or gambling products. For this reason it is critical that the trial include the appropriate support services to ensure that the proposal can support people to tackle the very complex and often intergenerational problems that confront these communities.

The need for a comprehensive package of support to accompany the debit card was raised in a number of the submissions to the Senate inquiry. The submission from Empowering Communities put it clearly when they stated:

The card alone will not solve the underlying factors which lead to drug, alcohol and gambling abuse, or the harm they cause.

The submissions highlighted that supports and services had to be part of any effort to meaningfully respond to the harm caused by alcohol abuse. In their submission to the Senate committee inquiry, Yalata Community Incorporation states:

It is the strong view of Yalata and other Aboriginal leaders that the cashless debit card by itself will not address the problems caused by alcohol. The success of the trial will be determined by the other support measures that are implemented at the same time.

If these accompanying supports and services are not provided, this trial is surely bound to fail and to merely act to penalise income support recipients in trial sites. As such, this new card should not be seen as a solution for all the problems in these communities.

Labor is unwavering in its commitment to helping communities tackle alcohol and drug abuse and the harm it causes. Labor is firm in our commitment to protecting individuals, particularly women and children and those who are most vulnerable within our community, from these harms. Frankly, it is appalling that Mr Tudge has sought to colour Labor's insistence on appropriate oversight and consideration of the trial as anything but a commitment to making certain that the proposed debit card trial will help these communities and protect vulnerable people.

Labor wants to ensure that the trial is sufficiently comprehensive to drive the long-term positive change needed for all communities that may be impacted. Labor knows that alcohol abuse and the harm it causes is having a devastating impact on the lives of people in some communities. However, Labor is concerned that the proposed debit card trial and related bill is not sufficiently comprehensive to meet its stated aims—to tackle alcohol, drug and gambling abuse and the harm it causes to particular communities. We are also concerned that insufficient evidence was provided about how the bill will operate and note that many of the details are yet to be worked through.

As I previously indicated, during the Senate committee inquiry we heard that there was a level of confusion about what had been agreed for the proposed trial. I share the concerns expressed during the inquiry that the consultations on the trial have been unsatisfactory to date. This does not undermine Labor's commitment to addressing alcohol abuse and harm. It does not undermine Labor's understanding of the desperate need for action to support long-term change. I completely reject Mr Tudge's characterisation that Labor is turning its back on what community leaders are saying or that we are placing the trial at risk by asking additional questions about the trial. This is scaremongering and avoidance of fulsome scrutiny of the legislation.

Rather, it is Labor's commitment to addressing these issues and our understanding that action is needed that drive our consideration of this bill. Labor is committed to supporting community leaders in responding to the harm caused in their communities through fulsome consideration of the legislation and its implications. We believe that this will ultimately support a better long-term outcome for people living in the proposed trial communities. As I have already stated, Labor is working hard to make sure that the trial is robust and will support its stated aims: tackling alcohol abuse and the harm it causes. That is why we are working hard to make sure that additional supports will be in place for participating communities, like drug and alcohol services, family violence services and financial management programs. I welcome the commitment of these supports to Ceduna, but this trial will impact on other locations and it will be critical that they receive similar adequate supports and services.

Another important element of the proposal, that Labor supports in principle, is the community panel model. However, it was clear from the evidence to the Senate committee inquiry that there is a lack of shared understanding about how a community panel could operate and when it might commence. This is largely due to the fact that there has been insufficient information from the government about the role and responsibilities of such a panel. The lack of detail and public information about exactly how the trial would operate was a consistent theme throughout the submissions to the Senate inquiry. Submissions from organisations such as Financial Counselling Australia, Consumer Action Law Centre and the National Welfare Rights Network highlighted a number of details and issues that they believed had not been worked out or made public.

These submissions raised concerns that many of the details about how the debit card will operate are yet to be finalised or sufficiently worked through, including how funds were to be managed, by which financial institution, privacy considerations and compliance monitoring. Submissions also raised concerns with the fact that the debit card trial would apply to all people on a working-age payment, with no mechanism for people to come off the debit card.

Many people in receipt of income support payments are responsibly managing their payments and in the interests of their family and children. These people may not individually benefit from the debit card. For this reason Labor would support further consideration as to whether people should be able to come off the debit card if they meet certain criteria. A mechanism like this would also act to encourage positive change for people who may be on the debit card. And while I welcome Mr Tudge's belated efforts to provide some of the details about the trial, it is simply unacceptable that the government thinks that the Senate should pass this legislation without having properly considered the detail and implications of the proposal.

Another significant issue which Labor is seeking assurances from the government on is the trial evaluation. Ahead of the commencement of the trial it is vital that a robust evaluation framework is in place. Without this type of evaluation any trial is pointless and we will not develop the evidence on the impacts. This is precisely the reason for having a trial.

Labor will continue to hold the government to account and to make sure that any outstanding details are worked through and agreed prior to a trial commencing. Once the government has provided the additional information sought we will be prepared to vote on the bill.

The trial of the proposed debit card is a significant measure that has implications for communities across Australia, beyond those where the trial will proceed. Labor acknowledges that it could have benefits for communities affected by alcohol abuse. It is important that the legislation is developed robustly and not be rushed. Labor, in government, followed a far more comprehensive and detailed process in developing substantive welfare reform measures of this type. Labor hopes the government will work hard in the coming months to rectify the shortcomings so that we can reach agreement on this bill.

We look forward to the government providing a full and detailed response on the outstanding issues that will then enable an informed debate on the bill. Again I note that the concern about the lack of detail that has been expressed by other senators in their contributions is, I believe, widespread in groups that are interested in this trial. I recommend that the government take up the Labor senators' recommendation in terms of the Senate community affairs inquiry into this bill, which asked that the bill not be progressed until there are sufficient consultations carried out in all the possible trial communities and a consultation report with proposed trial communities is made public.

There are a number of other points that the Labor senators on the committee made in their recommendation 2 on this bill. We again ask the government to make public the details of consultations, exactly how the debit card will work and the operations of the bill—including possible community involvement; income quarantining decision making; how people will transition from income management; agreement on the financial institutions; and, as I and other contributors to this debate have already mentioned, privacy considerations. Of course, very importantly, the compliance monitoring is to be made public.

I think it is quite clear from the contributions to this debate—not just from Labor senators but from other senators—that there are a number of concerns that a lot of details on how the debit card will work in the trial areas are not in this bill. A lot of questions have been asked that are currently unanswered, and the government needs to provide those answers to enable a robust and fully-informed debate to take place.

Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Link to 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.

…   …   …

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 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.

Sue Lines (WA, Australian Labor Party) Share this | Link to this | Hansard source

The question is that this bill be now read a second time.

Bill read a second time.