Prime Minister Malcolm Turnbull: Stop Income Management and the Healthy Welfare Card
Compulsory Income Management is an outrageous attack on the rights of welfare recipients and will have a damaging effect on small businesses.
"Seven years ago the government launched an Intervention in the NT which has tried to establish punishment and control as the policy framework for dealing with social disadvantage. The government's own evaluation shows overwhelming feelings of discrimination and shame. Youth suicide rates have increased 160% and reported rates of self-harm are up more than fivefold," Mr Gibson concluded.
"Now marginalised youth in Bankstown are also set to be punished at an astronomical administrative cost of between $4500-$7800 per person per year on income management.
Politicians in the Senate have voted in favour of extending the unproven income management regime to some of Australia's most vulnerable people.
The Government can expand income management at will through powers contained in the Stronger Futures legislation.
June 2013 the Parliamentary Joint Committee on Human Rights reported on Stronger Futures, including the income management provision. The report found that there was evidence of ‘equally significant adverse aspects' to counter any benefits of the regime. The Committee also noted the fact that income management intrudes on personal freedom and autonomy.
Compulsory Income Management (CIM) was introduced by the Howard Government in 2007 to 73 Aboriginal communities in the Northern Territory, and has since been extended to the entire NT, and several other locations. It was justified as an “emergency” measure, to protect Aboriginal children. It has been sharply criticised by the Federal Government Ombudsman in a 2012 report, and by numerous other Government reports.
CIM is humiliating, unfair, and unlikely to improve quality of life for welfare recipients or their children. There is no solid evidence that this policy achieves its goals, and we fear this approach will be counter-productive.
The Commonwealth Parliamentary Library's 2012 paper on CIM concluded that there is "an absence of adequate data relating to the effectiveness or otherwise of income management".
We note the Menzies School of Health's 2010 study of spending patterns of NT CIM clients, which reported that apart from the impacts of government stimulus payments, there have been no significant changes to consumption of alcohol, cigarettes, and soft drink, nor to fresh fruit and vegetables.
Given the Government's stated commitment to 'evidence-based policy', it is particularly disappointing that compulsory income management is being expanded beyond the NT when there is no compelling, objective evidence the policy achieves its goals. In July 2012, CIM was extended beyond the NT to five “trial” sites: Playford, SA; Bankstown, NSW; Shepparton, Vic; and Logan and Rockhampton, Qld.
The Equality and Rights Alliance's 2011 report surveyed 180 NT women on CIM. It found 85% had not changed what they purchased, 79% wanted to leave the scheme and 74% felt discriminated against.
It is claimed that CIM helps welfare recipients become more financially responsible. It is unclear how reducing recipients' control over their payments will achieve this goal. We are concerned this measure will entrench dependency and discourage recipients from developing financial management skills.
We fear CIM will have long-term mental health impacts. Consultations by the Australian Indigenous Doctors Association in 2008 revealed widespread feelings of humiliation and shame among NT recipients.
We also note international research indicating heavy-handed policies like forced income management tend to further stress disadvantaged families, potentially increasing family breakdown.
The cost of this policy is estimated at $4,600 per recipient annually in the five “trial” sites and between $6000-7000 per recipient annually in the NT. By comparison, employment agencies are provided with only $500 per long-term unemployed worker to address barriers to employment. The NT scheme has costed more than $500 million over five years.
We consider problematic the 'financial hardship' trigger for 'vulnerability'. Financial hardship is widespread among welfare recipients. Not because of widespread incompetence or irresponsibility but because of inadequate welfare payments, expensive rental markets, lack of public housing, and cost-of-living pressures.
We regard the 'financial hardship' trigger as a kind of "double jeopardy", punishing recipients twice. First, forcing recipients to survive on below-poverty line payments. Second, deeming them to suffer financial hardship because of low payments, thus forcing them onto income management.
We fear CIM will have negative consequences for those requiring emergency assistance, like domestic violence victims. The Australian Law Reform Commission's paper on this topic expressed concerns about circumstances to Centrelink, and thus being unable to access emergency services like Crisis Payments, for fear of being place onto income management.
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Stop Income Management
We call for the Federal Government's Compulsory Income Management to be replaced with more education programs to reduce drug/alcohol/gambling addictions, financial counselling, parenting programs and other support services that have been under-funded.
• We call for the more cost-effective and less heavy-handed Centrepay system to be further promoted.
• We call for welfare payments to be increased to liveable levels, which will dramatically improve quality of life for struggling families and individuals.
• We call for an alternative policy vision that respects the competence, dignity, and rights of individuals and targets the real causes of disadvantage.
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