Access to cash restricted from today for thousands on welfare as scheme’s success questioned
(ABC Wide Bay: Nicole Hegarty)
Thousands of Queenslanders will have restricted access to their welfare payments from Tuesday during the progressive rollout of the cashless debit card scheme.
The largest rollout yet, and the first for Queensland, will see 80 per cent of a person’s income support put onto a debit-like card which cannot be used to pay for alcohol, gambling, or to withdraw cash.
The remaining 20 per cent will be deposited in the same way as other welfare payments and can be withdrawn as cash.
The rollout in the federal electorate of Hinkler, which includes Bundaberg and Hervey Bay, is part of a trial passed by Parliament in September.
It applies to people under the age of 35 who receive the Newstart Allowance, the Youth Allowance or parenting payments.
Bundaberg resident Christian Mackay is one of 6,700 welfare recipients in the electorate who will be on the compulsory cashless debit card.
The part-time delivery driver said it would take a while to get used to, but he thinks it will help him save money.
“From what I heard before I did my research, it was going to change everything,” he said.
“I didn’t think I was going to [be able to] buy things that I wanted but once I did my research, I found there are only very few things you can’t buy with it and it is definitely going to help save money.
“In a way it can be slightly annoying, but I don’t really think it’s an issue.
“People are trying to help us so why not accept the help instead of making it hard for them?”
Money for essentials
The Federal Government hopes the cashless debit card scheme will mean taxpayers’ money would be spent on essentials.
Member for Hinkler, Keith Pitt, said the trial was aimed at addressing high rates of intergenerational welfare.
“This will be inconvenient for some but this is about ensuring that we provide the fundamentals, particularly for children who are, in this electorate, in some circumstances not being provided the basics of life,” he said.
“This is money provided by the taxpayer for those who find a themselves in difficult circumstances.
“I think every Australian supports that, but I don’t see any reason why that money should be spent in excess on alcohol, on gambling or on drugs — that is the only thing that the card prevents you from purchasing.
“The trial is for two years in which time I expect there will be significant improvements, particularly for our local kids and I think we just need to ensure that we keep an open mind.”
Department of Social Services data revealed 90 per cent of residents aged under 25 who were on welfare at the end of June 2016 had a parent who had also been on welfare in the previous 15 years.
Controversial card splits opinion
General manger of local support group Impact Community Services, Steve Beer, said many clients had negative views of the cards but once they had found out more, they were generally okay with the idea.
“If it helps some people better manage their money, if it helps some families better cater for the needs of their children, that has to be a positive,” he said.
However, Queensland Council of Social Service acting CEO Laura Barnes said the scheme was a “fundamentally flawed approach”.
“Taking people’s ability to manage their own money away does not address any issues — financial management itself let alone complex issues such as drug, alcohol, and gambling issues,” she said.
“To address these complex issues requires a mixture of responses including wraparound services in communities that are tailored to individual need and build on community strength.”
Federal Opposition Leader Bill Shorten said a Labor government would reverse the trial.
“The experts tell me that there are much better ways to use important taxpayer money to help people engage and get back into work and deal with challenges of addiction than this particular system,” he said.
“We will work with the community to roll it back and come up with better solutions which actually help people who are down on their luck and lift them back up and get them back into work.”
A similar cashless scheme has also been in place in remote parts of Western Australia and South Australia with mixed results.
As part of the trial, which will run until mid-2020, $1 million has been announced for additional support services.