Government Amends Cashless Welfare Debit Card Bill To Ensure Passage
Friday 16 February 2018 @ 1.52 p.m. | Legal Research
After reaching a compromise with the Nick Xenophon Team (NXT), the Federal Government has managed to get the Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 (Cth) passed through both houses of Parliament.
However, this compromise has necessitated the government falling short of their original objective, to repeal section 124PF of the Social Security (Administration) Act 1999 (Cth). The section deals with the trial of the cashless debit card program by limiting the time of the trial and the regions it can be trialled in. The repeal of s 124PF would have allowed the government to roll out the trial in any area it would designate by disallowable instrument. However, the Bill that passed Parliament instead extends the trial period under section 124PF from 30 June 2018 to 30 June 2019, and allows the Government to extend the trial to one additional trial area, the WA Goldfields region.
The House of Representatives approved the amendments made by the Senate on 13 February 2018. The Bill is now awaiting assent.
The Trial
The current cashless debit card trials are taking place in Ceduna in South Australian and WA’s East Kimberley area. The trial involves 80 per cent of each recipient’s income support payments placed in a restricted bank account that can only be used with a non-cash debit card. The debit card cannot be used for gambling or purchasing alcohol.
The government has argued that the trial has been successful. An independent evaluation conducted by ORIMA Research and published on Treasurer Scott Morrison’s website says the trial:
“has been effective in reducing alcohol consumption and gambling in both trial sites and [is] also suggestive of a reduction in the use of illegal drugs… there is some evidence that there has been a consequential reduction in violence and harm related to alcohol consumption, illegal drug use and gambling.”
Social Services Minister Dan Tehan told the ABC (as reported in The Guardian Australia):
“We want to roll this out. We want the trials to be successful… Because the feedback we’re getting from local communities is that the status quo isn’t working. The second, third-generation welfare dependence, and what that’s leading to, especially with children turning up to school without having been fed, etc – they want to see a real change. And they see this as a way to do that.”
However, Labor and the Greens opposed any new trial sites. The Guardian Australia reported the Labor frontbencher Doug Cameron saying in Parliament:
“Labor requires a much more rigorous evaluation of the cashless debit card in the existing trial areas prior to any expansion.”
He also said the program had already cost $25.5 million (approximately $12,000 per participant). However, the government has argued that the figures were due to one-off startup costs.
NXT MP Rebecca Sharkie opposed the amendments in the House of Representatives, before the compromise was reached with NXT Senators to ensure its passage through the Senate without Labor’s support.
The Amendments
The original Explanatory Memorandum to the Bill stated:
“This Bill removes section 124PF of the Social Security (Administration) Act 1999, which specifies that the cashless debit card trial will occur in up to three discrete locations, include no more than 10,000 people, and will end on 30 June 2018. Removing this section will support the extension of arrangements in current sites, and enable the expansion of the cashless debit card to further sites. Individual sites, once identified, will be determined by disallowable legislative instruments.”
The supplementary explanatory memorandum, which reflects the compromise reached in the Senate, says:
“The amendments to the Bill specify that the sites for the cashless debit card trial are East Kimberley and the Included Communities, Ceduna and the Surrounding Region and Goldfields. The amendments also extend the cashless debit card trial until 30 June 2019.
The Bill retains existing legislated limitations on trial parameters in relation to the number of sites, participant numbers and duration of the Cashless Debit Card program. Additionally, the Bill removes the ability for trial areas to be determined under legislative instrument and instead provides for them under the primary legislation. The Minister will instead be able to declare that specific parts of the Ceduna area, East Kimberley area and Goldfields area are not trial areas.”
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Sources:
Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 (Cth) and explanatory materials, available from TimeBase's LawOne service
Delivering on cashless welfare card (The Hon Scott Morrison MP)
