The former federal government in 2016 introduced the trial of a welfare quarantining system, via a Cashless Debit Card, that aimed to govern how those in receipt of welfare spent their money. The idea was to both prevent the sale of alcohol, cigarettes and some gift cards and block the funds from being used on activities such as gambling.
Participants of the ‘trial’ would have 80 per cent of their funds placed on card also referred to as the ‘CDC’, which is managed by a third-party company called Indue, with the remaining 20 per cent paid into a bank account.
The Cashless Debit Card was, as you could imagine, fraught with problems. Dictating how someone could spend their benefits was, without sugar-coating it, disgusting.
Back in 2020, when the then-government was trying to sneak the extension of this ‘trial’, Labor Senator Malarndirri McCarthy begged them to withdraw it completely.
Labor said there was no evidence that compulsory, broad-based income management actually works. Ultimately, the Bill was labelled as racially discriminatory, with approximately 68 per cent of the people impacted being First Nations Australians.
“This legislation is wrong. It is unjust, it is racist and so un-Australian,” McCarthy said at the time.
It was no surprise that when Labor took power, repealing the Cashless Debit Card was going to be high on its agenda. In August, it kicked off an inquiry into the Social Security (Administration) Amendment (Repeal of Cashless Debit Card and Other Measures) Bill 2022 that was introduced at the same time. The Bill seeks to amend the Social Security (Administration) Act 1999 to abolish the Cashless Debit Card program.
After a short inquiry (what’s there to discuss, really? It’s a trash idea), the Senate Community Affairs Legislation Committee this week handed down its report. Like music to the ears of many Australians, the committee recommended that the Bill be passed, putting an end to the welfare quarantining system.
There is one condition, however, and that’s asking the government to work with the Queensland Family Responsibilities Commission to address concerns the commission raised over whether the passage of the Bill would impact its statutory responsibilities.
The Cashless Debit Card program was in operation across parts of SA, WA, Qld and the NT. Those living in Ceduna, SA, had been living with the nightmare since March 2016. In total, 17, 322 people have been placed onto the scheme. That’s 17,322 people that have been told where and how they could spend their money.
In total, it cost the government more than $170 million.
It’s not over, however, with Monash University, for example, stating that withdrawal of the card will need to be undertaken carefully, to allow participants to transition their finances to alternative providers. The legislation leaves more than 23,000 people on the BasicsCard, a longer-standing compulsory income management scheme run by the Department of Social Services. As Elise Klein, associate professor at the Australian National University, puts it: if the government forces people to stay on the BasicsCard, what has it learnt from the Cashless Debit Card?
Technology is great, and as we move more and more towards a cashless future, programs that prevent people from being left behind are great. But this wasn’t one of those programs. With Robodebt still front of mind for many, the Cashless Debit Card has always been another example of government tech that was unleashed to the vulnerable without proper consideration for the consequences.