Minister for Employment & Workplace Relations, Bill Shorten. Picture: Aaron Francis
EMPLOYMENT Minister Bill Shorten has backed a controversial argument being put by his senior mandarins that the dole should be kept low to encourage the unemployed to take badly paid jobs.
A submission from four federal departments to a Senate inquiry into the Newstart Allowance says the OECD acknowledges that a rise in the base rate from $245 a week “has the distinct disadvantage of reducing employment incentives, especially for those who can only obtain low-paying employment”.
A spokesman for Mr Shorten said: “The submission is obviously the government’s position” despite it previously saying it had a more open mind. “I’d also point you to what the minister had to say about this to you on Sky Agenda at the end of last month.”
In the interview, Mr Shorten said he wanted to look at what could be done to break intergenerational cycles of long-term unemployment. “Intergenerational unemployment is a disaster for generations of people.
“But by the same token, I am fully aware that trying to get along on $249 a week is an incredibly difficult ask.”
Mr Shorten is coming under pressure from the union movement to overhaul the welfare system. The ACTU will today declare major reform of the income support system is vital to help unemployed people find decent, secure work. ACTU president Ged Kearney said reform must start with a $50-a-week rise to Newstart, which had not increased in real terms since the early 1990s and was barely enough to live on, let alone pay for the costs of finding a decent job. “The rate . . . is just 18 per cent of average wages . . . and is widely regarded as a major cause of entrenching people in long-term poverty, with insecure work playing a large role,” she said.
The ACTU wants Newstart raised to the level at which the payment starts to be withdrawn when people begin work, and a wider independent inquiry into the effects of insecure work on welfare.
Unions NSW has called for the Youth Allowance to be increased by $50 a week and indexed in line with pension payments. It wants the income threshold to be increased by $25 a week, allowing Youth Allowance recipients to earn $450 a fortnight before their payments are reduced. The government submission claims an increase to the dole would not assist in maintaining the “fundamental character of Newstart Allowance as a payment that predominantly supports work re-engagement”.
“Work incentives are built into the design of Newstart Allowance and a substantial increase in Newstart payment rates would reduce the incentive for some recipients to move off payment and into self-supporting work”.
The Senate inquiry follows lobbying by business and welfare to increase Newstart, as single mothers face losing an average $50 a week after being shifted from the parenting payment to the dole from January.
The joint submission — from the Department of Education, Employment and Workplace Relations, the Department of Families, the Department of Human Services and the Department of Industry — seeks to blunt support for a $50-a-week rise to the dole.
Peter Whiteford of the Crawford School of Public Policy at the Australian National University argues that since 1996 payments for the single unemployed have fallen from 23.5 per cent of the average wage for males to 19.5 per cent.
Wayne Miller and Tracey Cox. Picture: Russell Millard
Mick Haynes leans forward and stares into the eyes of his dead teammates. They gaze back at him, young, strong and proud, their smiles forever frozen in a team photo on the wall of the Koonibba footy club.
“There I am,” says Haynes, pointing to the young bloke sitting in the middle of the Aboriginal team from 1982. His finger then moves slowly over the 20 men in the photo. Dead … Dead … Dead … Haynes looks away and shakes his head. “There’s only about six of us still left,” he says. “In some way or other alcohol contributed to cutting them down.”
Photos of other teams and former players line the walls of the country’s oldest Aboriginal footy club in Ceduna, South Australia. Their surnames — Betts, Davey and Wanganeen — are household names to AFL fans. But the photos inside this proud club also reveal the tragedy of this small town. “If I talk to these boys, they won’t talk back to me — I will be standing on their grave,” says Peter Miller, a tribal elder and former halfback for the Koonibba Roosters in the 1970s. “Lots of them drank pretty heavily — there are only five left from my team.”
Miller adjusts his bush hat and wonders whether much has changed in his hometown since he was a boy, when alcohol abuse was rife. “This morning I saw a girl about 19 years old crossing the road with a bottle of Jack Daniel’s and I said to myself, ‘It’s only bloody 10 o’clock.’ I see it every single day. But you know what? She wouldn’t have been able to buy that bottle if her money was on that card.”
Peter Miller. Picture: Russell Millard
“That card” is now the talk of the town in Ceduna and may soon become the talk of the nation. The 4000 residents of the Ceduna region are the first in Australia to undergo a controversial 12-month trial that Canberra hopes will revolutionise the fight against alcohol abuse by those on welfare in rural and regional Australia, especially among Aboriginal people. If the trial goes well, the card will be rolled out to other regions across the nation.
On March 15, those on welfare in Ceduna — indigenous and non-indigenous — will no longer receive all their benefits in cash. Instead they will be issued a small silver card, similar to a credit card. Eighty per cent of their welfare payments will go onto the card, with only 20 per cent available as cash. The card can be used for anything anywhere in the country with two glaring exceptions — alcohol and gambling.
This will leave most welfare recipients (aged care pensioners are exempt) with only $60 to $150 in cash a week, depending on their circumstance. “It’s so important because in many areas of regional Australia, particularly indigenous areas but not exclusively so, there is very significant alcohol, gambling and drug harm that is paid for by the welfare dollar,” says Alan Tudge, Assistant Minister to the Prime Minister, who has led the Government’s push for the so-called cashless welfare card. “When you’ve got communities that are awash with grog it’s so hard to make progress on any other front.”
In Ceduna the card will apply to around 950 welfare recipients, of whom two-thirds are indigenous, although the Government maintains that the card is not specifically directed at Aboriginal communities. In April it will be trialled for 12 months in the East Kimberley communities of Kununurra and Wyndham and options are being considered for a third site. Another Kimberley community, Halls Creek, rejected the trial, saying the card was indiscriminate in its targeting and would not work.
To its supporters, cashless welfare promises a new era in the fight against welfare abuse by making it much harder to blow welfare payments on grog or gambling. Its critics say it is an overly paternalistic intervention in people’s lives which undermines personal freedoms and is unlikely to achieve its aims. “[It] will disproportionately affect Aboriginal and Torres Strait Islander people and claw back our hard-won rights and freedoms,” says Aboriginal and Torres Strait Islander Social Justice Commissioner Mick Gooda. “Our mob are once again the guinea pigs in a trial program lacking any evidence base.”
Ceduna Mayor Allan Suter. Picture: Russell Millard
Ceduna mayor Allan Suter sits at his dining room table and shakes his head at such claims. He says his town has been in deep trouble for much of the past decade, blighted by alcohol abuse, domestic violence, gambling and more recently the drug ice. “This card,” he says, “is desperately needed by some people, including some who are against it. We have had huge issues in this town with lawlessness, unsociable behaviour, people drinking to excess and dying.” He says Ceduna, which is around 25 per cent indigenous, has 68 times the national average rate of hospitalisation from assaults. In 2014, the town’s sobering-up centre had 4667 admissions from a population of 4000.
In 2011, a coronial inquest into the deaths of six Aboriginal people in Ceduna found a “severe and intractable culture of excessive alcohol consumption” among transient Aborigines who visit from communities to the west of the town, such as Yalata and Oak Valley. Suter says Ceduna has tried everything possible to end the scourge of alcohol abuse, from bans on grog sales to dry areas to safety patrols, but the problem still exists.
Tracey Cox and Wayne Miller. Picture: Russell Millard
“I’ve seen things in Ceduna that I would never want to see,” says Tracey Cox, a 26-year-old indigenous mother of two, speaking at a barbecue at Suter’s home. “I used to work as a domestic violence support worker and I’ve seen first-hand the alcohol and drug use and how the children suffer from it.” Her voice trails off before her fiance Wayne Miller, 26, interjects: “We need to try something now. These same things have been happening for 40 or 50 years, we’ve heard it from our uncles, aunties and parents and we just need to change things. I don’t see why this card won’t work.”
Miller, an up-and-coming indigenous leader, and Suter, mayor for the past eight years, have been targeted because of their role in promoting their hometown for the trial. Suter has been parodied and abused on social media while some other indigenous leaders have accused Miller of seeking to disempower his own people.
Leeroy Bilney. Picture: Russell Millard
“Wayne Miller has great potential to be a good leader but he has been mentored and manipulated in the wrong way,” says Leeroy Bilney, an indigenous local. “We need to give some kind of ownership and responsibility back to our communities and this [card] is no different to listening to my pop talk about how they used to walk around with ration cards.”
The idea of the cashless welfare card was born out of the review of the welfare system in 2014 by mining billionaire Andrew Forrest. The card is far more ambitious and sweeping than previous attempts at income management of welfare recipients in Australia. Since the 2007 intervention in the Northern Territory, successive federal governments have experimented with income management, also known as welfare quarantining, with mixed results. Almost 26,000 people — 20,000 of whom are in the NT — are currently on the BasicsCard in which 50-70 per cent of spending is quarantined for essential items. Ninety per cent of those on the card are indigenous. But the BasicsCard card can only be used at selected retailers, is limited in scope and almost useless outside areas where it has been rolled out. The new cashless welfare card quarantines 80 per cent of payments and is connected to the national EFTPOS system so it will automatically reject attempts to buy alcohol or bets anywhere in the country. The trial does allow welfare recipients to apply to have the percentage of cash lifted from 20 per cent to as high as 50 per cent, but only with the approval of a community panel.
Mick Gooda claims that previous attempts at income management have achieved results that are only “modest compared to their stated objectives”. “For many, income management results in few or no benefits, and a sense of loss of control, shame and unfairness,” he says.
Alan Tudge disputes this. He argues the BasicsCard has had a “positive impact” in the NT but believes the more comprehensive cashless welfare card will achieve better results. “Two-thirds of people who come off the BasicsCard on a compulsory basis choose to stay on it on a voluntary basis,” he says. “That fact proves that many people find it useful for them.”
In late 2014 and early 2015, when Tudge was casting around for potential places to trial the Forrest welfare card idea, mayor Suter called his local federal MP, Rowan Ramsey, and said Ceduna might be interested. “I said our council would support a trial provided that our community supported the idea, so we began a consultation process,” says Suter.
Tudge knew that such a radical and controversial initiative could only be introduced with the full support of local leaders and indigenous elders. But more than this, he wanted the leaders in
Mick Haynes. Picture: Russell Millard
Ceduna to play a frontline role in shaping how such a card might work. “First of all, we were like ‘Whoa’,” says Mick Haynes, the former Koonibba Roosters player and now head of the Ceduna Aboriginal Corporation. “We were a little bit sceptical about how this card was going to work, so we said to Alan Tudge, ‘Leave it with us and we will talk about it’.” Haynes was part of a regional leadership group comprising both indigenous and non-indigenous leaders, which was set up to determine whether the card could work in a town like Ceduna.
The Ceduna group was forthright and clashed with the authorities several times in the first half of last year. They disagreed with Forrest’s call for a 100 per cent cashless card, saying it was impractical in a small town like Ceduna. “We thought that if a family goes to the footy or something and they want a pie or a pastie you’ve got to have some cash because some places won’t take cards,” says Haynes. The Government initially wanted the card to be a 90/10 per cent split while the Ceduna leaders wanted a 70/30 split; a compromise of 80/20 was finally reached.
“They [the Ceduna leaders] not only helped to shape the card, they co-designed the entire effort,” says Tudge. Haynes says there was a lively debate about the card inside the Aboriginal communities around Ceduna, but that the vast majority — some 95 per cent — eventually supported the idea.
Card critic Leeroy Bilney disputes this figure. “A lot of people in our [Aboriginal] communities won’t come forward and say what they really feel until the card comes in and starts to impact on them and their family,” he says.
Another indigenous local, Sue Haseltine, claims the issue has divided Ceduna and that at least 30 people, indigenous and non-indigenous, have left the town because of the upcoming trial. “I don’t believe they have the right to target everyone [on welfare],” she says. “They wanted to target a few people and so they killed our human rights and took our freedom away.”
The opponents of the card in Ceduna are a small but vocal group who accuse the Government of foisting the idea on the community without proper consultation. They argue that the card is an invasion of personal freedom; that it is demeaning to those on welfare; that it won’t stop the true addicts; and that it will lead to increased violence as people steal to get cash.
The card trial has bipartisan support from the Government and Labor but is opposed by the Greens. “It will make people feel worthless and it is damn insulting to me,” says Ceduna local David Pav, a disability support pensioner who will be given the new card. “I feel like I may as well dig a hole and die because there is no reward for good behaviour, no way to get off the card.”
On this day Pav has been joined at the local pub by six other opponents of the card. Each is non-indigenous and each has their own reason for opposing it. Grant Thiselton runs a waste management company, Ceduna Skip Bins, which he says is a 70 per cent cash business which will take a hit when the cashless card is introduced. Next to him is Jocelyn Wighton, who claims she is being unfairly targeted. “I am on a disability pension, I don’t gamble, I don’t drink much … I’ve done nothing wrong but I still have to be on the card,” she says.
When I ask an older lady who is sitting quietly on the other side of the table what she thinks, she pulls out some paper and reads nervously from a prepared script. “It was alcohol that blinded the mind of our son’s murderer [in Ceduna] three years ago,” reads Colleen Martin. “Yet it is not the alcohol that caused the loss of our son, it is the needs that caused the ongoing drinking in the first place. A cashless people in our community will not solve the problem, it will only make it worse … [and] create more violence to get the cash they currently need. It is too late for our family, but it’s not too late for many,” she says.
She folds up the paper as tears well in her eyes and in the eyes of her adult daughter Jodi, who is sitting next to her, squeezing her hand. Colleen’s son Tony, 33, was stabbed to death in an alcohol-fuelled attack in Ceduna in November 2013.
Opinions are divided about whether addicts — alcohol, drug or gambling — are more likely to rob, steal and fight in order to get cash that will be denied under the welfare card. Some argue that a true addict will simply find a way to get cash, illegal or otherwise. “We have discussed the fact that it may be an issue and the police are very much aware of it,” says Suter. “In Coober Pedy when they brought in strong restrictions on alcohol they did have a crime spurt but it wasn’t an ongoing thing.” Tudge is confident that crime will fall as a result of the card. “The expectation of senior police is that crime will decrease because so much of the crime in the community is related to alcohol consumption,” he says.
The biggest divide over the card is whether it tramples on personal rights in seeking to dictate the behaviour of those on welfare. The arguments are similar to those over the 2007 intervention. “Any possible benefit of the card must be weighed against the sense of disempowerment our people already face,” says Gooda. “It must be weighed against the stigma our people continue to face and the restrictions placed on our basic rights and freedoms we fought so hard for.”
It’s an argument that makes Mick Haynes furious. “I don’t think it is a breach of human rights,” he says. “What about the rights of kids when parents are spending their welfare money on alcohol or gambling?” he asks, thumping his hands on his desk. “Is it the right of a kid to have a safe home?” Thump. “Is it the right of a kid to have clean sheets and a bed?” Thump. “Is it the right of a kid to have food on the table and to go to school?” Thump.
“This card is very much thinking about the rights of children and the rights of women to live safely in their community,” says Tudge. “A person who is on this card can spend their welfare payments on absolutely anything they like but they can’t spend more than 20 per cent of it on gambling and drugs. Now, how that is a breach of their human rights I do not know.”
Ryan Edmonds. Picture: Russell Millard
“Look at this mess,” says Ryan Edmonds as he steers his paddy wagon along a rough bush track on the outskirts of Ceduna. He stops the car near an abandoned humpy, gets out and picks up an empty bottle of Jack Daniel’s. Around him are more than a dozen other whisky bottles and empty silver wine cask bags. A broken television, a filthy mattress and a burnt-out car lie among shoes, rags and other debris, making this popular drinking spot look more like a rubbish tip than a slice of Australian bush. “Bottles, bottles and more bottles everywhere you look,” says Edmonds, who runs Ceduna’s council-funded Community Safety and Security Patrol.
We are at a place called 18 Tank, described as “a flat, desolate and pitiless area of land” by deputy state coroner Anthony Schapel in his 2011 report. “They bring with them their sicknesses and morbidities, all aggravated by continual self-neglect and the excessive consumption of locally accessed alcohol — some of them have perished as a result,” Schapel wrote.
Edmonds patrols Ceduna and its outskirts every few hours, moving people on from illegal drinking spots and reporting dangerous drunken behaviour to the police or to the local hospital. The patrols, which cost the council $250,000 a year, were introduced in 2008. Edmonds says as many as 60 indigenous people often gather at 18 Tank and a handful of other bush spots outside town where they can drink legally, unlike in Ceduna itself where public drinking is banned.
As we drive back to town, the 31-year-old former miner, fisherman and oil rig worker recounts tales of alcohol abuse here. “Someone was run over on this road a while back because they were drunk and fell asleep,” he says. “They’ve been passed out on the railway track also.” One local truck company has had so many near-misses with locals falling asleep on the road that it produced its own safety video to teach people not to lie on roads when drinking.
“When I first heard about this welfare card, I wasn’t sure to be honest,” Edmonds says as he drives down another bush track littered with bottles. “But I’ve seen so many people drink it all away that I now think it might actually help.”
“I’ve seen first-hand what alcohol does to this town,” says Mick Haynes. “Our community is disintegrating and our Aboriginal culture is slowly being eroded. Lots of things have been tried but they’ve failed and this [card] could be a circuit-breaker.”
About 10km out of Ceduna, in Denial Bay, Mick’s brother Joe Miller rises unsteadily from a chair on his veranda, using his left hand to raise his immobilised right hand so I can shake it. Joe, 62, was by his own admission a heavy drinker when two massive strokes hit him in 2012, robbing the once-robust mining worker of his career and a normal life. “I don’t know, it may have been the alcohol, but I also smoked a lot,” he says when asked what might have triggered such a life-changing event.
Joe doesn’t know what to think of the welfare card idea. It won’t affect him because his wife Lois works as a schoolteacher, giving them enough cash to buy what they want. Joe worked all his life until the stroke and says he can’t understand someone being on welfare and then complaining about it. “I’ve had to work all my life to get this house, to achieve my dreams,” he says. But Lois wonders whether the card will actually work. “I think it’s a good idea in theory but practically I don’t think it will address the root of the problem,” she says. “I think if people really want to get cash, they’ll get it somehow.”
Greg Limbert points to the bush opposite Ceduna’s Highway One roadhouse, which he ran for 20 years. “In the morning, you would often see people literally crawling across the road from the town camp to come [to the roadhouse] to see how much money they had in their account so they could buy alcohol,” he says. He believes the card will help some people but says it may also affect “some of the people who need it the least”.
An alcohol-fuelled fight in Ceduna. Picture: Russell Millard
The irony is that the card is being introduced into Ceduna at a time when local police and ambulance officers say there has been a slight fall in the incidence of alcohol abuse since December. That is when fresh restrictions were placed on buying takeaway alcohol, including a complete ban on sales of alcohol to Aborigines visiting Ceduna from outlying communities. Even so, as I am writing up notes in the local hotel, a fight erupts outside between two clearly intoxicated women with one throwing wild punches and kicks. I later see ambulance officers tending to the bruised face of the woman who was bashed.
The Government has flagged that if the trials in Ceduna and East Kimberley prove effective, the card is likely to be introduced into other rural and regional areas, including non-indigenous communities. “A logical step would be to continue to roll it out to the regions that have requested it,” says Tudge, although he baulks at suggestions it might eventually be used in capital cities. “To be honest we are not at that stage of our thinking.”
Rodger Kerr-Newell, chief executive of Halls Creek Shire, which rejected the trial, has accused Tudge of peddling a “zombie-apocalypse” picture of Aboriginal communities to win support for the trials.
But Tracey Cox, the former domestic violence worker and mother of two daughters, Halle, four, and Maddison, 18 months, says the problems in Ceduna are all too real. “I’ve seen enough of it,” she says, her eyes flashing with anger. “We see kids coming to school with no food each day because Mum or Dad has gone and spent the money. These kids have a right to learn and to eat — they are our future. Some people don’t have the strength in them to make the right decisions and this card could make it for them. For the better.”
She pauses and reflects on the tough choices facing her hometown and her people. “If it doesn’t work then we can try another way,” she says finally. “But at least we can say that we tried.”
As we go into the new political year, I am putting out a request to our sitting leaders: the Australian “innovation nation” desperately needs some innovative policy.
Our stagnant political environment has got to respond to a changing economy by looking at radical ideas and trying new things.
I have one such idea. Let’s trial an Australian basic income.
An Aussie version of the universal basic income would be a payment made to every citizen, no matter how rich or poor.
At $1000 a month, it would cover one’s primary needs and create a floor for living standards. It would be netted off from existing government programs such as the pension and Newstart, as well as from the tax deductions received by the rich.
Such a program would really make a meaningful difference to the lives of people struggling in the new world of Uber and the changing nature of work.
Growth in the so-called “gig economy” — driven by changes in technology and shifting demand and supply relationships in the labour market — means that thinking about unemployment and welfare needs to change.
Employment is becoming increasingly unstable, with a growth in casual, part-time or short-term roles.
The ABI would allow everyday people to continue to plan and engage with the labour market, to make the economy grow strongly and fairly for decades to come.
Australia needs this because our welfare system is broken. It’s well known that means-testing welfare payments warps the incentive to work.
For every dollar a jobseeker on Newstart earns over $102 a fortnight, they are penalised 50 per cent via reductions in their welfare. Above $252, it is 60c in the dollar.
This is a higher effective rate than that paid by the richest in the land. It’s little wonder that people get stuck on welfare.
While removing the disincentive to work, the ABI also allows the unemployed to take risks and engage fully in the fluctuations of the gig economy. It would promote economic dynamism and individual responsibility, and break dependency cycles.
Importantly, with such a program in place, people will be able to start businesses or join start-ups knowing there is a safety net there during the no-income early phase.
The payments allow people to participate with dignity in society. Evidence from Britain is that this radically improves the engagement of those at the bottom of the social ladder and brings people back into employment — it does not get them to sit on the sofa watching television.
This idea has a history of support by some on both the Left and Right and has been gaining traction recently in Canada, Switzerland and The Netherlands.
The biggest splash came from Finland, where a trial is being implemented next year.
We cannot wait for the rest of the world to take the lead on this. To begin with, we should trial our own version of the program with a group of 50,000 people in Tasmania or South Australia.
Such a trial would tell us how such a scheme could provide for a uniquely Australian context.
By creating the momentum for change, it would give us a chance to overhaul the Australian concept of welfare.
And it would allow us to show the world we are the innovative nation we claim to be.
The real problem with the ABI is its cost: even on a net basis, the ABI undeniably needs a major increase to tax levels. Where would the money come from?
As I have advocated before, changes to negative gearing, land taxes, superannuation, GST and company tax would all be good places to start.
Australia is one of the world’s wealthiest countries, with some of the lowest rates of taxation. We are in a unique position to try out a truly new idea, and make it our own.
For too long, Australian politics has tinkered with tax and transfers as though our democracy were powerless to make a change.
If the Prime Minister wants an innovative economy, he’s going to need the innovative policy to match.
Mark Carnegie is an investor and founder of MH Carnegie & Co.
In Aboriginal and Torres Strait Islander communities across the country, old wounds are being reopened. Many of our people are being forced to revisit the past trauma of income management and stolen wages.
The federal government’s Healthy Welfare Card has created great concern and contention, as the measure will disproportionately affect Aboriginal and Torres Strait Islander people, and claw back our hard-won rights and freedoms.
The government, with the support of the opposition, has passed legislation, without any amendments and with very little consultation, to control the finances of Aboriginal and Torres Strait Islander peoples in three trial sites, beginning with the South Australian town of Ceduna next month. The third proposed site, of Halls Creek in the Kimberley, rejected the idea out of hand, with the shire president Malcolm Edwards saying it had adopted the position of its Aboriginal advisory committee to reject the plan.
“At the last meeting, they voted against having the card. They thought it was a bit unfair because it targeted everyone,” Mr Edwards said.
All welfare recipients in the trial areas will have 80 per cent of their welfare quarantined to a bank card. Only 20 per cent of their welfare payment would be available in cash, which the Assistant Minister for Social Services, Alan Tudge, has himself admitted could leave some welfare recipients with as little as $60 in their pocket each week.
It is deeply troubling that the government is “contemplating how to proceed should the trials prove successful” before any trials have even begun.
It begs the question — have the trials been structured in such a way the results have already been predetermined?
What is most perplexing is the government’s apparent fascination with controlling the finances of Aboriginal and Torres Strait Islander peoples.
Our mob are once again the guinea pigs in a trial program lacking any evidence base.
As I outlined in my 2015 Social Justice and Native Title Report, where people have experienced benefits as a result of income management, the results have been modest when compared to their stated objectives. For many, income management results in few or no benefits, and a “sense of loss of control, shame and unfairness”.
Any possible benefit of the card must be weighed against the sense of disempowerment our people already face. It must be weighed against the stigma our people continue to face, and the restrictions placed on our basic rights and freedoms we fought so hard for.
We are told by the government that the measure will tackle the serious issue of alcohol and drug abuse within our communities.
There is no doubt that alcohol and drug abuse are contributing factors to creating dangerous and disruptive communities; and all children have the right to grow up in safe, nurturing environments — Aboriginal and Torres Strait Islander children are no exception.
We have no evidence to support the prediction that a restriction on cash payments will curb an individual’s addiction or their ability to provide a safe environment for their children.
According to Mr Tudge, restricting supply is an effective measure to address these problems. But in the same way that people with serious addiction can circumvent restrictions on supply, they will undoubtedly find innovative ways to circumvent limits on their capacity to purchase.
The role of government is to provide effective policy, based on the best available evidence. In the case of the Healthy Welfare Card, there is no conclusive evidence that it will effectively address issues of alcohol and drug abuse, and encourage good parenting.
Our people do not need a compulsory blanket approach to tackling these issues. We want to work with government to develop long-term, effective solutions to the challenges we face.
I agree with Mr Tudge when he says, “collectively we have to get control of the alcohol abuse that destroys communities and threatens the next generation”, but I disagree that the card is “the solution”. Serious addiction requires thoughtful treatment options rather than punitive measures and silver bullets.
The hardest part of this proposal to accept is that yet again the treatment of our people will be different to mainstream Australia, and it is this differentiation of treatment that we have fought so hard to bring into the open.
Mick Gooda is the Aboriginal and Torres Strait Islander Social Justice Commissioner.
Sarah Martin, 20 January 2016 Assistant Minister for Social Services Alan Tudge is overseeing the rollout of the cashless welfare card. Picture: Stuart McEvoy
A cashless welfare card aimed at stemming alcohol abuse would be rolled out across the country under a welfare reform the Turnbull government is considering taking to the election.
As regional trouble spots line up to be chosen for trials of the government’s new Healthy Welfare Card to begin next month, The Australian understands the Coalition may seek an election mandate to extend the card to welfare recipients across regional Australia if they achieve positive results.
Under the new system — proposed by mining magnate Andrew Forrest in his review of the welfare system in 2014 — 80 per cent of a person’s government payment would be quarantined to a bank card that could not be used to buy alcohol and gambling products, nor converted to cash.
The remaining 20 per cent could be accessible as cash.
Last year, the government successfully passed legislation to allow the card to be trialled in three test sites, affecting up to 10,000 welfare recipients, beginning in the far-west South Australian town of Ceduna next month, and the East Kimberley in northern Western Australia in March.
The Australian can reveal that since the East Kimberley trial site was announced in November, up to seven West Australian shires have contacted Liberal MPs seeking to take part in the trial of the card, predominantly from the Mid-West and Gascoyne regions.
Melissa Price, MP for the vast regional seat of Durack, said the councils had contacted her because they were struggling with social dysfunction arising from alcohol abuse that was not being curbed by existing programs.
“There is a sense of urgency, certainly in my patch of regional Western Australia, where in some cases we have got alcohol management plans that have worked to a certain extent, but people want to see the Healthy Welfare Card implemented alongside the alcohol management plans,” Ms Price said.
“Without a doubt, if you don’t have a community that is abusing alcohol, it is better not just for the individual but for the community itself.”
Ms Price is pushing for the regional centre of Geraldton to become the third trial site.
This would allow the government to test the card in a city where the majority of welfare recipients are non-indigenous and provide a blueprint for how the card could work in metropolitan areas.
“Obviously it is subject to the results of the trial, but it is very interesting to see how this could get rolled out in a major city as this is not just a problem in the bush,” she said.
If the card were rolled out across all regional communities in Australia, up to 100,000 people on government income support could be captured.
It could include more people if the Basics Card in the Northern Territory were replaced, or if metropolitan trouble-spots currently subject to income quarantining were also included.
Assistant Minister for Social Services Alan Tudge, who is overseeing the rollout of the card, is hopeful trials will prove the measure can be the “solution” to alcohol-induced social harm.
He says that if the trials are successful, the government will want the card to have a broader application.
“Offering the card to other regions would a logical next step, beginning with those Western Australian locations that have already shown initial support,” Mr Tudge writes in The Australian today.
“Others have suggested that the card could have wider application.
“It is early days, but one thing is clear: collectively we have to get control of the alcohol abuse that destroys communities and now threatens the next generation.
“The cashless welfare debit card may be the solution.”
The government is walking away from its flagship Work for the Dole scheme and will save $127 million by restricting the program and its contingent intensive support to unemployed people under 25.
The money will be recouped over three years from the program that was at one stage due to have 150,000 participants across the country.
Between July and September this year, the vast majority of work-for-the-dole participants were over 25. Estimates data shows there were 21,131 over-30s and 15,148 under-30s. On September 30, there were more than 21,000 people aged over 25 in Work for the Dole.
Work for the Dole was mandatory for those aged up to 60 under the old regime, tied to monthly appointments with the government’s Jobactive service providers , to help them find work.
Under the updated system, those receiving the “intensive” services at June 30 this year will be grandfathered, but new entrants having problems finding work and jobseekers over 25 will use regular Jobactive services.
In the three months from July to September this year, the government spent $64.5m on Work for the Dole, including $12.5m to co-ordinators.
As at June 30, almost 17 per cent of job-support clients who had found work for six months — considered a bonus milestone — were back without work after a further six months. The rate was almost 30 per cent for those with the most significant support requirements.
Work for the Dole was criticised by many in the welfare sector for being ineffective compared with other intensive training options or wage subsidies. About 19 per cent of those participating in Work for the Dole schemes were employed three months later.
Departmental data suggests wage subsidies result in job outcomes of between 47 per cent and 65 per cent after six months.
More money will be given to a national program to help school- leavers into full-time work with the $212m Transition to Work getting a $109.8m boost over four years. The program is for people aged 15-21, including those who are not on income support, to help them overcome barriers to employment and gain skills to get into the workplace.
Lisa Stewart, 29, said without compulsory Work for the Dole she would never have had the opportunity to acquire the skills to find full-time work. Ms Stewart, who left school in NSW in Year 9, ended up in Adelaide at 19 with a limited education, few skills and next to no job prospects.
She is now a fully fledged hospitality employee with the Adelaide Convention Centre and the Tandanya indigenous arts centre’s cafe, after completing a vocational education course in North Adelaide and a Work for the Dole program, where she worked three days a week.
“I’ve had a pretty rough trot throughout my life, but I am determined to better myself and get on the road to success,” she said. “They should not discriminate on how old you are. I only found myself in my mid-20s and the doors started opening through the Work for the Dole program.”
The government’s flagship indigenous job creation program that aimed to employ 5000 people by the end of the year has resulted in just 471 jobs retained for longer than six months.
Based on the GenerationOne employment model developed by mining magnate Andrew Forrest, the $70 million Vocational Training and Employment Centres were an election commitment of the Coalition and are designed to reward businesses for keeping indigenous Australians employed.
Figures obtained by The Australian from the Department of Prime Minister and Cabinet show that while 2723 people have started the VTEC program since January 2014, just 471 have secured employment for the targeted 26 weeks.
A total of 1978 indigenous jobseekers have been placed in jobs in the past 18 months. Many may yet meet the 26-week employment target by the end of the year.
But about 10 per cent of participants — 237 people — have begun jobs and dropped out of the program, and a further 192 people have left the program before beginning employment.
The program has so far cost about $20m.
The figures provided by the department suggest the retention rate for those who begin employment placements is about 66 per cent.
Labor indigenous affairs spokesman Shayne Neumann said the results suggested the program was falling short of its promised benefits and the government would fail to meet the 5000 jobs pledge.
“This has been going on for almost two years now and we have dismal results,” Mr Neumann said.
“It hasn’t started well, the drop-out rates are already significant, and only 17.3 per cent of people who have started have reached the 26 weeks, so that is not a good outcome.”
But GenerationOne’s national manager of vocational training and employment Matthew O’Sullivan said the outcomes were positive, particularly given the program dealt with many hardcore unemployed.
“With several thousand indigenous people moving into employment already and with many more expected do so by the end of the year, GenerationOne is proud of what is being achieved by the network of VTECs,” he said.
“This is particularly so when you consider that VTECs are required to target indigenous jobseekers that have been assessed by Centrelink as having significant and multiple barriers to employment.”
Under the program, VTEC providers are contracted to employ strategies to ensure job retention rates and must provide post-placement support throughout the 26 weeks of employment.
Indigenous Affairs Minister Nigel Scullion said the government was monitoring the program.
“While it is too early to assess final outcomes, the government is monitoring progress closely and supporting VTECs to reach employment targets,” Senator Scullion said.
The government initially committed $45m for the country’s 28 VTECs to place up to 5000 indigenous Australians into “guaranteed jobs”. A further $25m was committed to the program in last year’s budget under the Indigenous Advancement Strategy.
Income management in remote indigenous communities and low socioeconomic regions will be extended for three years as the government rolls out the new healthy welfare card.
A funding boost of $147 million will continue income management in all current locations, supported with $25.6m for financial counselling and support services across two years.
Mining magnate Andrew Forrest’s proposed healthy welfare card, which prevents the spending of welfare payments on alcohol and drugs, will be allocated $2.7m for consultation with communities and industry.
The funding also will be used to identify the technology and service delivery arrangements for a “commercially delivered debit card arrangement”.
Further funding will be provided across three years to undertake trials of the debit card in up to three communities, based on the recommendations made in the Creating Parity report. Locations are to be determined.
“The trial is expected to reduce harm resulting from alcohol, drugs and gambling, while also testing a role for community leaders in influencing social norms,” the budget papers read.
Funding associated with the trial has not been disclosed, as negotiations with potential providers are yet to be finalised.
Thirty-two service delivery hubs will provide financial literacy education, an indigenous mentoring program and an expanded Indigenous Home Ownership Education service.
THE federal government is falling behind on a key election pledge to create one million jobs over five years, in a blow to its economic agenda as experts warn that the target may never be achieved.
Jobs are being created too slowly to reach the goal, just as Tony Abbott names “jobs and families” as his top priorities for the year ahead after a punishing political fight over last year’s budget.
In the next test of the policy, official figures to be released today are tipped to show monthly jobs growth that is too low to meet the government target.
The setback highlights a broader challenge for the nation as the resources boom fades and the economy cools, forcing the government to consider new ways to balance the budget at the same time as it wants to use public spending to shore up growth.
With job insecurity high and job creation below long-term trends, the nation is set for a steady rise in unemployment that could harm consumer confidence and retail sales.
The government admitted yesterday that there were new pressures on tax revenue after The Australian revealed a $2 billion hit to major gas projects as a result of falling oil prices, compounding the problems of falling iron ore and coal prices.
Employers created about 11,700 jobs each month during the government’s first 12 months in a continuation of the relatively weak jobs growth since the global financial crisis.
Mr Abbott needs job creation to jump to 18,000 every month for the next four years to deliver on his promise, a huge rise that economists now consider to be unlikely.
Employment Minister Eric Abetz stood by the jobs pledge yesterday but conceded that it was going to be difficult to deliver and sought to blame Labor and the Greens for preventing new jobs schemes getting through parliament.
The jobs pledge was one of the first priorities in Mr Abbott’s Real Solutions plan before the last election, promising to generate “one million jobs over the next five years” by forging a bigger and more productive economy.
But, with challenges mounting, economists said the government had been “misguided” to make the promise to voters when it needed a lift in economic growth that was yet to materialise.
“It is hard to see it being achieved, even though 200,000 extra jobs a year doesn’t seem much more than what is implied by population growth,” said Melbourne Institute of Applied Economic and Social Research principal research fellow Roger Wilkins.
“Lower oil prices will probably help growth, but unemployment seems to be inexorably edging higher over the next year or two.
“In any case, it is a misguided — and close to meaningless — policy goal.
“ The real policy targets should be things like economic growth, employment-population rates and household income growth.”
Australia had 11.5 million people in jobs when the Coalition came to office so its formal target needs jobs growth of just less than 1.75 per cent a year, said Bank of America Merrill Lynch chief economist Saul Eslake.
“That would imply that real GDP growth needs to be at least 3.25 per cent per annum in order to achieve the government’s promise,” Mr Eslake said.
But, instead, economic growth this year is expected to be 2.5 per cent.
The government trimmed its forecast for employment in last month’s budget update while it warned of higher unemployment.
Mr Eslake warned that trends in productivity could mean the government would have to boost real economic growth to 4 per cent a year to reach the target, well beyond the levels foreseen in the budget.
“The bottom line is I think this will be a difficult promise to achieve, and one that really shouldn’t have been made in the first place,” he said.
Others praised the government for being ambitious and said the nation needed a big target to keep Australians in work as the population increased.
“We haven’t got enough employment growth to soak up all the people entering the workforce,” said HSBC chief economist Paul Bloxham. “I do think the government’s target is achievable.
“It’s a challenging time to get the economy to grow at its trend levels (about 3 per cent a year) but we remain optimistic that growth will continue to rebalance from the mining sector to the non-mining sectors.
“And, as the economy rebalances, employment should continue to grow.”
The latest monthly jobs figures will be released by the Australian Bureau of Statistics today with Deutsche Bank chief economist Adam Boyton tipping the addition of about 10,000 jobs.
The weaker jobs growth could give Labor a powerful political weapon against the government at the next election, although Bill Shorten has not outlined any alternative policies to produce better growth than the government. While business groups and economists note that employers — not governments — actually create jobs, the Prime Minister’s message to voters was that the Coalition’s economic agenda would generate more growth and encourage employers to hire more staff.
Senator Abetz said the promise remained government policy. “The government is confident of reaching its job target of one million jobs over five years,” he said.
“However, we do not underestimate the task and the difficulty in achieving it given the ALP/Green tactics of blocking and delaying our job creating initiatives.”
The budget last May forecast employment growth of 1.5 per cent this financial year but this was cut to 1 per cent in the mid-year update in December.
The gloomier outlook has led the government to scale back its hopes for revenue from personal income tax, at the same time that it expects to collect less company tax than planned because of the slump in iron ore and coal prices.
Assistant Treasurer Josh Frydenberg acknowledged the challenges and hinted at more savings in the May budget to respond.
“The numbers will be reviewed when it comes around to the next budget in May but there’s no doubt this is putting pressure on government revenue,” Mr Frydenberg said.
Labor’s assistant Treasury spokesman Andrew Leigh claimed that meant the government was flagging a “fresh round of cuts” in the budget.
“The Abbott government has today confirmed that its only economic strategy is to cut and keep cutting,” Dr Leigh said.
JOBSEEKERS in remote indigenous communities “with no economy” may never get a real job and could spend up to three decades working for the dole.
However, Indigenous Affairs Minister Nigel Scullion told The Australian that as long as jobseekers are taking part in 25 hours a week of meaningful community activities, working for the dole in perpetuity was not a negative outcome.
“I don’t think that is a bad thing,” he said. “They are engaged in purposeful activities in their communities, where they choose to live, and they are choosing to live in an area where there is no economy and a growing population. And while people may say, ‘How can you possibly do this to people?’, there are no alternatives.”
The government is planning to introduce tough new rules for the Remote Jobs and Community Program that aim to end passive welfare and the harmful effects of “sit-down money”.
Under the tightened welfare rules, which come into effect on July 1, jobseekers in remote areas aged 18-49 will be obliged to undertake work-for-the-dole activities for 25 hours a week, five days a week, for most of the year.
Approved activities would include helping getting children to school, aged care, volunteer work, learning to drive and literacy and numeracy training.
Senator Scullion said the scheme could improve living standards, citing unhygienic conditions in remote areas that contributed to chronic disease.
“Many of my communities live on the floor, it is like a cave,’’ he said. “I think that one of the characteristics of civilisation must be that you don’t have to eat at the same level as your animals, it must be something like that. I feel very strongly that we should try to provide furniture.”
On Friday, a Senate inquiry heard there would not be an exhaustive or exclusive list of approved activities as the scheme needed to be flexible enough to meet individual requirements.
Senator Scullion insisted the program would not provide free labour to companies in remote areas, but businesses should be engaged where possible.
He again stressed that the government would take a hardline approach to passive welfare.
“Staying at home like a couch potato with the channel clicker is probably not amongst (approved activities) because this is about moving people from a dangerous and vulnerable place to a more positive place, and ensuring that they are connected with the sort of skill set and the sort of environment that allows them to move into work when it becomes available,” Senator Scullion said.
Consultations on the final design of the scheme — including potential for annual and cultural leave — is continuing with remote communities and job-service providers. The policy will apply to both indigenous and non-indigenous recipients of Newstart and Youth Allowance in 60 remote areas, covering 76 per cent of Australia’s area.
About 37,000 people are covered by the Remote Jobs area, 83 per cent of them Aboriginal or Torres Strait Islander.