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Twiggy Forrest’s cashless welfare card gets results

andrew forrest cashcard

Andrew Forrest with Ainsley Meeway following the launch of his review recommending the cashless welfare card. Picture: Colin Murty – The Australian

By Cameron Stewart  10 May 2016   The Australian

There are early signs that the Turnbull government’s new cashless welfare card is benefiting ­indigenous communities near the trial town of Ceduna in far-west South Australia.

The welfare card is opposed by the Greens as a blight on personal freedom but enjoys bipartisan support from Liberal and Labor as a trial attempt to curb alcohol abuse in regional Australia, especially in remote indigenous communities.

The card, which quarantines 80 per cent of welfare payments from being spent on alcohol or gambling, has been operating for only seven weeks but one Aboriginal community near Ceduna ­already has recorded a strong increase in the purchase of fresh foods.

Since the card was rolled out on March 15, truck deliveries of food to the indigenous community of Oak Valley have doubled from one truck every two weeks to one a week.

Local sources say it is early days in the year-long trial in the ­region, but they say the need to double food deliveries to the Oak Valley community is a positive sign.

“It suggests that less money is being spent on alcohol and more on basic essentials like fresh food,” a source connected to the project said.

Local sources said a second ­Aboriginal community of about 250 people at Yalata near Ceduna has been “much quieter” since the card was rolled out, a fact some ­attributed to the lack of ready cash to bring alcohol into the officially dry community.

They also reported a greater take-up by indigenous communities of budget planning, where counsellors help a person or family draw up a budget.

The Ceduna region, in the safe Liberal seat of Grey, is the first of two trial areas for the so-called cashless welfare card that aims to reduce alcohol and gambling among all welfare recipients, not just indigenous recipients. If the trial is a success, the government could roll out a similar system across regional Australia. However, critics say it is an overly ­paternalistic intervention that is unlikely to achieve its aims of curbing alcohol abuse in regional Australia.

Card rollouts also have begun in a second trial zone in the east Kimberley communities of ­Kununurra and Wyndham. The government is negotiating for a third trial zone near Geraldton, 424km north of Perth.

About 90 per cent of the 950 welfare recipients around Ceduna have received the small silver card, similar to a credit card, on which 80 per cent of their welfare payments are placed, and which can be used to buy anything except ­alcohol and gambling products.

Only 20 per cent of their welfare payments are given as cash, leaving most recipients with ­between $60 and $150 cash a week, depending on circumstances.

However, the rollout at Ceduna was not problem-free, with some recipients reporting their cards malfunctioning.

The cashless welfare card arose from a 2014 review of the welfare system by mining billionaire ­Andrew Forrest.

Original article here

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About steveblizard

Steve Blizard commenced his financial planning career in 1988 from a background of life insurance broking, a field in which he still works. He is a member of the Financial Planning Association and the Responsible Investment Association. His experience ranges from administration of Superannuation to advice regarding insurance, retirement, remuneration and investment planning. Steve is an accredited Remuneration Consultant, specialising in salary packaging. He is a columnist for the Swan Magazine and the WA Business News

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