While the Federal Government aims to make the cashless debit card a permanent fixture of welfare management, independent research is questioning whether the taxpayer-funded program has a substantive effect on the behaviours it’s targeting.

Income management was introduced in the Northern Territory in 2007 under the NT Emergency Response with the aim of restricting access to gambling, pornography, drugs and alcohol.

The policy was introduced without a legislated end date. It continues 13 years later through the BasicsCard.

The BasicsCard can only be used for pre-approved goods and services and is accepted at just 16,000 EFTPOS terminals nationally.

In 2016, the cashless debit card was introduced and trialled in South Australia’s Ceduna and the East Kimberley and Goldfields regions of WA. And last year it was introduced into the Hervey Bay and Bundaberg regions of Queensland.

The card quarantines 80 per cent of a recipient’s welfare payment and automatically applies to all those who receive a working-age welfare payment. It’s accepted at more than 900,000 EFTPOS terminals nationally.

In Queensland, it also applies to those 35 and under who receive certain welfare such as Newstart, Youth Allowance or parenting payments.

Participants are only able to exit the program on the condition they demonstrate “reasonable and responsible management” of their affairs. And now a Bill before Federal Parliament is proposing making the CDC permanent nationally.

Put to Parliament in early October, the Bill also proposes to move NT participants from the BasicsCard to the CDC.

“The BasicsCard is just that, basic, whereas the cashless debit card will provide people with far greater choice and control over where and how they spend their social security payments,” Federal Minister for Families and Social Services Anne Ruston told the National Indigenous Times.

“In addition, through the CDC we are responding to community concerns around stigma as the new card looks the same as any other bank card.”

Since its introduction the CDC has disproportionately affected Indigenous people.

The Australian Institute of Health and Welfare says as of June 2018, 45 per cent of Indigenous Australians over 15 were on some form of welfare payment.

The comparison for non-Indigenous Australians was 23 per cent.

According to Australia’s 2020 United Nations Universal Periodic Review NGO Coalition Report, 81 per cent of the program’s recipients are Indigenous.

The 2017 report The Cashless Debit Card trial evaluation: A short review by Centre for Aboriginal Economic Policy Research, deputy director and senior fellow Dr Janet Hunt found that within the Ceduna region 45 per cent of Indigenous residents were on the CDC.

In comparison only 6 per cent of non-Indigenous residents were on it.

In the East Kimberley, 49 per cent of Indigenous residents were on the CDC. This compared with 10 per cent of non-Indigenous residents.

In proposing the permanency Bill, the Government’s message has been that the CDC provides a nationally applicable solution to ending welfare reliance. However, a 2018 evaluation of the CDC trial by the Australian National Audit Office found it was difficult to conclude whether there was a reduction in social harm.

It was also criticised by the Auditor-General for not making use of all available administrative data and noted the trial was not designed to test the program’s scalability.

Recently, the Government paid $2.5 million to researchers at the University of South Australia for an updated evaluation. The draft report was provided on September 29 with a final report submitted on October 27.

At a Senate Estimates hearing on October 29, Social Services Minister Anne Ruston said she hadn’t read the draft reports. This is despite the legislation already being introduced.

“The Government is confident that welfare quarantining measures, which have been in place in various forms since 2007, have a positive impact on participants and the broader community,” Minister Ruston’s spokeswoman said.

She did not elaborate further on what these positive impacts were. Questions to both Prime Minister Scott Morrison and Minister for Indigenous Australians Ken Wyatt’s offices about the integrity of the CDC program were referred to Senator Ruston’s statement to NIT.

Wongutha woman and lecturer in management at the University of South Australia’s Business School, Dr Skye Akbar, published independent research on the CDC on October 8.

It concluded it had no substantive effect on targeted behaviours.

“As a researcher, when you work really hard on an analysis and the answer is zero, it’s quite shocking,” she said.

“Once we sat back, we realised that having no impact on the policy aims is also a very important finding.

“I was very naive before I started this work and I genuinely believed that the Government would look up evidence to develop policy and build in some way to measure whether or not that policy was working.”

“I am quite surprised to learn that this is how our taxpayer money is being spent.”

Shadow Minister for Indigenous Australians, Linda Burney, opposes the continuation of income management.

“Thirteen years after the intervention, the Government has failed to demonstrate broad-based compulsory income management actually works,” she said.

“The Government’s determination to roll this card out in the face of a lack of evidence just goes to show this card is nothing more than an ideological obsession.”

Greens Senator Lidia Thorpe shared these concerns.

“It is discriminatory,” she said. “They’ve used us again as guinea pigs for this oppressive policy. It needs to be scrapped.”

WA Liberal Senator Matt O’Sullivan said he had been “on the ground in trial site communities”.

“Participants have consistently reported drinking less frequently, using drugs less frequently and gambling less,” he said.

By Rachael Knowles