Transcript: ABC Hobart - Statewide mornings, interview with Leon Compton

2 November 2016

The Hon Alan Tudge MP

Minister for Human Services
Cashless Debit Card

We want to talk to Alan Tudge, he's the Human Services Minister in the Federal Government. You'll remember a couple of weeks back we spoke with Jacqui Lambie.

She said she'd been off to South Australia to look at a trial of something called a cashless welfare card, which means that people on welfare in some communities have the payment handed to them at levels of up to 80 per cent on a card.

That card is like a credit card. It can only be used, though, on a proscribed number of goods like fresh food, accommodation and bills, and so on. What it can't be used on are things like alcohol and poker machines and smokes.

Is it an idea that we should be talking about in Tasmania? Jacqui Lambie certainly thinks so. Alan Tudge, Human Services Minister, good morning to you.

Good morning, Leon.

I've paraphrased how it works. How would you describe the way the cashless welfare card works in the communities where it's been trialled?

Yeah, you actually did a pretty good job there, Leon, and it's a pretty simple concept, really. Instead of providing all welfare payments into a person's savings account, as we do presently across Australia, in a savings account, where you can immediately take that out cash, we put 80 per cent of people's welfare payments into an account which is only accessible via what is a Visa debit card.

This Visa debit card works anywhere and it can purchase anything with three exceptions: it won't work at bottle shops, it won't work at the gambling houses, and you can't take cash out from it. And consequently, of course, you can't purchase illicit substances, but otherwise you can purchase whatever you like.

The overall objective of the card, at least in the trial sites that we've got going on today, is to reduce some of that really significant harm which is caused by welfare-fuelled alcohol, drug, and gambling abuse.

You see this in pockets across Australia. It not only affects individuals, but often it leads to devastating consequences for the broader community as well.

You talk about welfare-fuelled. The problem is that the welfare payments we give to people these days are relatively small. It's not much fuel to get you very far.


What do you say to people who are deeply troubled by the restrictions that this places on a person's ability when receiving welfare to make their own choices about their own lives?

I suppose people can still spend their welfare dollars on whatever they like, but they just can't spend more than 20 per cent of it on gambling, on booze, or indeed on drugs. And I don't think that's an unreasonable proposition.

I think that the Australian tax payer is very happy to contribute part of their taxes towards supporting people who are down on their luck, but they don't expect those taxes to go towards excessive drinking, alcohol or gambling. So I think it's a relatively simple proposition.

Now, if you're not a big drinker, a gambler, or a drug taker, then really the only impact on you from this card is that instead of reaching into your pocket for cash, you'll reach into your pocket, grab your card, swipe it, and off you'll go.

How has it worked in the communities where you've rolled it out at the moment?

We've got two trials at the moment, Leon. One in Ceduna- or the Ceduna region in South Australia, and another one up in the East Kimberley. Now, to date they've had very promising results. We're half way through the trial, six months in, we've got another six months to go.

Poker machine revenue, for example, at the main pokies venue is down 30 per cent since the introduction of this trial. Now that's in a broader community where only about a fifth of the people are on welfare payments, so you get an idea of how much those welfare payments were going into the poker machines.

We've had a halving of the number of people being arrested for being intoxicated by the Police in Ceduna since the trial began. Up in the East Kimberley we've had, according to the hospital director, a dramatic reduction in people admitted to hospital from drunkenness.

So all of these are really encouraging signs. I stress that we're only half way through the trial, we want to ensure that those results continue. But we're certainly very pleased with how it's going so far.

Alan Tudge, Jacqui Lambie, who I'm sure you know, says that she would be interested in seeing the idea rolled out in Tasmania. Do you think, based on what you can see, the State should consider having it here?

I've been having many conversations with Jacqui Lambie, she's been a supporter of this concept since we first floated it a couple of years ago. We haven't made any decisions about what we might do post the conclusion of these trials.

What we want to do is to see if they are trials in the very sense of the word. We're learning from them. We want to do a proper evaluation and then make decisions off the back of them.

Now, the next most logical step, if you like, if these trials continue to be successful, is to offer it to other regions, almost on an opt-in basis.

I've also floated the idea that perhaps we should be looking at what New Zealand does, and that is apply it to a younger cohort of people, particularly under 18s, actually.

That's what New Zealand does and it seems to be having a positive impact there in terms of helping people structure their finances better and also becoming a greater stimulus for taking work when it's available.

When you say regions, so you're still thinking about it from a regional perspective? Who would make that decision, region by region, if it came?

It's typically the community leaders, Leon. Certainly that's how it's being done today. So we work, and continue to work, very closely with the community leaders in each of the two trial sites.

They co-designed these trials with me and the Government and continue to oversee the implementation of them.

Now, there are other regions already that have approached me and said that they would be interested in exploring this, typically regions that have got ice problems or have got alcohol problems which they're trying to get on top of, and they can see some of the results in the trial sites and they're interested in exploring it for themselves.

So I've had some discussions with some people in Tasmania in relation to it, but certainly we're not in the position to be making any decisions at all, at this stage.

If you trialled it in one region, what are the prospects that somebody would just move to another region if they needed to use a greater percentage of their welfare payment, for example, to fuel a drug habit?

Then you might just move to a different region, sign up there and go back to the old system.

Yeah it's a good question, Leon. It doesn't work like that and we've thought through that. Certainly in our trials, what we see when at the start of the trial, your residential address, from that point in time, will be the basis of you maintaining your card for the duration of the trial.

So even if you move to a different town, the card will travel with you, if you like. And I think that's an important principle to try to avoid that situation that you're talking about.

In essence we've learnt a little bit from this is in more extreme situations when there have been alcohol restrictions in more regional or remote settlements, and you often have that problem there, whereby some people then leave those towns to avoid the restrictions and then in some cases you do move the problem elsewhere. Here you don't because the card will travel with you.

On ABC local radio around Tasmania, Alan Tudge is our guest this morning, the Human Services Minister. I'm wondering what you, listener, think of this proposal. Is it something that you'd welcome in your part of the state? 130022936.

Kerry's given us a call this morning, Minister, and Kerry asks, is there a difference in how the card looks? Is there a stigma attached to having this card and having to use it publicly?

Yeah, there isn't. And again, we thought a lot about this. Because the aim was to not have any stigma attached to it at all. And so it literally is a Visa debit card.

It's silver in colour, because that's one of the most common colours of Visa credit cards. And if I held up my- I've got an ANZ credit card, if I held that up alongside my card - this cashless welfare card Visa card, they're almost indistinguishable.

Okay, so the question is, where to from here? And the reason we asked you on was, you know, are you considering this idea for Tasmania at the moment? So where to from here, Minister?

Yeah, so we want to continue on for the completion of these trials. There's another six months to go. We'll then have a full independent evaluation of them. I hope that they will continue to see the results that we're seeing to date. And then we'll be making decisions from there.

We're just not in that position right now, but certainly I'm in discussions with community leaders that have approached me, so that we know of their interest. And I suppose I call out for community leaders if they are interested in having a discussion with me, then they're more than welcome to do so.

But we do want to finish the trials first, get that independent evaluation before making any further steps after that.

Sheryl asked via text this morning, which welfare payments? Would it be the disability support payment? Is it just the unemployment payment? Which payments might be eligible for this?

For at least the trials, it was all working age income support payments. So it's not just your unemployment benefits, but also your disability employment benefits and your parenting benefits, for example. They were the major three.

This was discussed with the community leaders in Ceduna and the East Kimberly respectively. And that decision was made that yes, all of those payments of working age should be included.

For pensioners, they've got the option of opting in if they choose to do so and some people may want to do that for particular reasons in those regions.

Thanks for talking with us this morning.

No worries at all Leon, thanks very much.

It's an interesting idea, Alan Tudge, Human Services Minister.