The Cashless Welfare Card Is Patronising, Ideological, And Undignified


Greens Senator Rachel Siewert puts her party’s case against the new welfare management scheme, introduced by Labor and the Coalition.

You know that sinking feeling when you find exactly what you need at a garage sale, but you’ve only got your card? Or when you want to buy a drink but there’s a $10 minimum for using your card?

Thanks to laws the Government just passed with help from Labor, people in three Australian towns who receive income support payments such as Newstart, Disability Support Payments, Carer Payment and Youth Allowance will have this feeling all the time.

The Government’s new laws are for a ‘cashless welfare card’ trial. People on some income support payments will only be able to get 20 per cent of their payments in cash. The rest can only be used on the card, which means it can only be used at stores or supermarkets where credit or debit cards are accepted.

The card is supposedly to stop alcohol and substance abuse and gambling, but it targets everyone on a working age income support payment, not just people wishing to gamble and who abuse alcohol and other substances. It will hurt many people who are doing the right thing but fall within the parameters of the cards trial zone.

The card is the brainchild of mining magnate and billionaire Andrew ‘Twiggy’ Forrest.  It is clear from questioning in the Senate that the Government hasn’t resolved many of the practicalities of how this system will operate. The Senate has now voted on a measure where there are many important unanswered questions.

Despite the passing of this legislation thanks to the major parties, the Government still hasn’t finished choosing a financial provider. That means we still don’t really know how the measure will be implemented in practice. There are unsolved problems and questions about minimum card purchase amounts, merchant surcharges (the 2-3 per cent costs that can get added on when you use a card) and replacing lost cards and various decision making processes during the trial.

An example from the National Welfare Rights Network shows the practical challenges people on the card might face:

“Marcia does not get out much. Marcia has been struggling with depression for a while, has diabetes and poor mobility and is socially isolated, and experienced a recent suicide in the family, which hit her hard. It’s hard making the bills and rent on Newstart Allowance. As a treat in the fortnight her social security payments are made she goes to the local café in town, where she reads the weekend paper on the tables, and buys a strong cup of coffee. She looks forward to these fortnightly outings, and hopes to meet up with friends. The coffee shop has a minimum EFTPOS purchase of $10, which she can’t afford, so she stops visiting the coffee house”.

What happens if there is not enough in the 20 per cent cash pot to cover lunch money, bus money, garage sale, second hand purchases, amongst other things? The loss of dignity is astounding.

People talk of this loss of dignity and disempowerment when they think about going on the cashless debit card. People on the BasicsCard in the NT share the same experience – the government has a disproportionate control of their income and therefore over their life.

The Government claims that the proposed debit card is not an extension of Income Management but it is. Compulsory Income Management is not only a failed measure, it impacts negatively on the communities it affects and imposes significant costs on Government.

One of the proposed trial sites, the Shire of Halls Creek, recently rejected the measure. They set out several reasons for their decision, including; the evidence income management is a flawed approach, the practical impact of the measure on people who need cash for everyday transactions, the lack of other resources, and the failed consultation process.

It is for a myriad of reasons, some outlined here, that the Australian Greens opposed the cashless welfare card trial legislation.

Communities facing significant challenges need genuine social services that help individuals deal with the challenges they are facing. Limiting cash will not stop alcohol or substance abuse, people will find other ways to access alcohol, this was evidenced in the NT.

Properly funded long-term detox and rehab services, wrap around services that meet people’s needs, early intervention supports, addressing the causes of disadvantage, better controls on the supply of alcohol all help address this terrible problem.

The Government should abandon its patronising, ideologically driven approach that hurts rather than helps.

People on income support are some of the best at handling their finances and living off next to nothing, this card well and truly throws a spanner in the works for many just trying to get by.

Rachel Siewert is a Greens Senator for Western Australia.

Rachel Siewert is a Federal Greens Senator for Western Australia. She is the Party's Whip, and spokesperson on family and community services, ageing, disabilities, Aboriginal and Torres Strait Islander issues, agriculture and rural affairs and the marine environment.