NTCOSS Submission to the Senate Community Affairs Legislation Committee on the Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020

The Northern Territory Council of Social Service (NTCOSS) is the peak body for the Northern Territory (NT) Community and Social Services Sector and is a voice for people affected by social and economic disadvantage and inequality. The Community Sector in the NT is made up of community managed, non-government, not-for-profit organisations that work in social and community service delivery, sector development and advocacy. The Community Sector plays a vital role in creating social wellbeing for all Territorians and in building safe and healthy communities by providing services that enable people to access and participate in health services, education, employment, economic development, and family and community life.

NTCOSS believes that all people and communities should live a life free of poverty and disadvantage. NTCOSS advocates for the relieving of cost of living pressures, such as reform to income support and welfare systems, in partnership with our members.

NTCOSS represents a varied service sector and acknowledges that a number of our member organisations with specific expertise in this area have also provided submissions to this inquiry and the previously conducted Senate Community Affairs Legislation Committee Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019. In particular, NTCOSS supports new and previous submissions by our Aboriginal Community-Controlled member organisations (ACCOs), including Tangentyere Council. NTCOSS also supports the detailed submission and recommendations provided by the Aboriginal Peak Organisations Northern Territory (APO NT).

Background

While NTCOSS welcomes the opportunity to provide a submission to the Senate Community Affairs Legislation Committee on the Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 (the Bill), this submission will reaffirm the position NTCOSS has previously taken in a previous submission to the Senate Community Affairs Legislation Committee Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019.

In summary, the position put forward in the previous submission was as follows;

• NTCOSS does not support the passage of the Bill and the expansion of compulsory Income Management (IM).
• Considering that any changes to IM in the NT disproportionately impact Aboriginal people, and particularly those living in remote localities, it is essential that any programs and service delivery for Aboriginal people recognise their sovereignty, and that Aboriginal people and communities have control and agency over matters affecting them.
• IM should be on an opt-in basis.
• That the Government raise the rate of Newstart (now JobSeeker) and related payments and focus on addressing rates of unemployment, inequality and poverty through addressing the social determinants of health.
• That funds allocated for the implementation of the Cashless Debit Card (CDC) trial in the NT be reinvested in communities to address the causative factors of disadvantage and poverty, prioritising ACCOs to deliver such programs.
• That any future trials or iterations of the CDC and IM be subject to rigorous and independent evaluation processes.

NTCOSS is concerned that, a year later, adequate steps have not been taken to address the above, while further changes put forward in the Bill have the capacity to stigmatise and harm communities. NTCOSS does not support the Bill and urges the Government to instead invest in policies that acknowledge and support the importance of community agency. Meaningful co-design and self-determination must be a cornerstone of any future policy.

Impact of IM and CDC in the NT

The NT is home to the highest proportion of Aboriginal people in Australia, with more than 100 languages and dialects spoken across the region.¹ Data from March 2018 shows that there are over 22,000 people on IM in the NT, with 82% of this population identified as Aboriginal; the majority of who are recognised as long term welfare recipients.²

Of the poverty rates in Australia, people living in Remote or Very Remote localities experience much higher levels of poverty than those living in urban centres.¹¹ These high rates of poverty are experienced disproportionately across the NT, with Aboriginal people in particular overrepresented in homelessness and unemployment rates, and poor educational outcomes. As a result of this, people experiencing vulnerability face further challenges with damaging effects on health, social wellbeing and long-term security, and poverty and disadvantage becoming further entrenched in our communities.

As reported by the Australian Council of Social Service (ACOSS),³ the original purpose of IM was to stem the flow of cash that is expended on substance abuse and gambling, and to ensure funds that are provided for the welfare of children are expended appropriately.⁴ Despite this, there is little evidence to support that IM has successfully achieved these goals.

IM in the NT was evaluated between 2010 and 2014,⁵ with key points from the report highlighting;

• “Very little progress in addressing many of the substantial disadvantages faced by many people in the Northern Territory”;
• “No evidence to indicate that income management has an effect at the community level, nor that income management, in itself, facilitates long-term behavioural change”;
• The cohort of individuals most interested in continuing IM were undertaking it on a voluntary basis;
• It is much harder for Aboriginal people to exit IM, especially those in remote communities; and
• Rather than building capacity and independence, for many people on compulsory IM, it has made them more dependent on the Government.

Further to the above, IM in the NT has reportedly had a negative impact on key indicators of health, including birth weights. In a paper delivered at the National Bureau for Economic Research Indigenous Health, Wellbeing, and Children’s Outcomes workshop in Boston in November 2019, researchers identified an average drop in birth weights for IM participants of more than 100 grams, with a 30 percent greater likelihood of a low birth-weight outcome of that scale compared to prior to the 2007 Intervention and the introduction of IM.⁶ Other research has not found conclusive evidence that IM has positively impacted social and health outcomes, including school attendance.⁷

Additionally, a joint study released by the University of Queensland on four CDC trial sites found that the majority of recipients reported to not have a problem with drugs, alcohol or other dependencies before entering onto the card, and that the majority of respondents did not see any benefit to the scheme and reported negative consequences of being moved onto it, such as not having enough cash to pay for essential items.⁸

The Australian National Audit Office (ANAO) found that the Department of Social Services (DSS) had taken an inadequate approach to monitoring and evaluation regarding the CDC trials in a 2018 report,⁹ stating that as a consequence of this, it was difficult to determine whether the CDC trials resulted in a reduction of social harms or it if was a lower cost welfare quarantining approach.

One of the original authors of the evaluation of IM in the Northern Territory, who has since also been responsible for a number of other reviews regarding income quarantining, put forward that the positive effects identified by some evaluations are opinion-based, and not supported by relevant data measuring health and wellbeing outcomes related to the policy’s objectives.¹⁰

While there may be anecdotal reports of positive outcomes from IM, there is no conclusive, data-driven analysis relating to IM in the NT and other CDC trial sites. Considering Government plans to roll the CDC out on a permanent basis in the NT, with no cap on participants (impacting over 22,000 people), it is of great concern that a top-down, blanket approach is being taken regarding people’s welfare.

Community Leadership and Co-Design

The National Agreement on Closing the Gap includes priority reform areas that focus on transforming the way governments work with and for Aboriginal people to improve outcomes. The priority areas of reform focus on areas such as shared decision making and embedding ownership; developing the capacity of ACCOs; and ensuring government agencies and institutions undertake systemic and structural transformation to better contribute to Closing the Gap, while improving accountability.¹¹

Noted concerns regarding the expansion of the CDC into the NT include lack of meaningful consultation with communities, no remote jobs development and the refusal to introduce the CDC on an opt-in basis.¹² A permanent, blanket imposition of the CDC on the NT, without addressing these concerns, goes against the principles set out in the National Agreement on Closing the Gap.

IM was first introduced in the NT as part of the 2007 Northern Territory Emergency Response (NTER). The NTER required the suspension of the Racial Discrimination Act 1975 to explicitly target all Aboriginal and Torres Strait Islander people on welfare.¹³ New Income Management (NIM) was introduced to replace IM under the NTER in 2010, which included reinstating the Racial Discrimination Act, meaning non-Indigenous people were included.

Despite the reintroduction of the Racial Discrimination Act, CDC trial sites in Ceduna and the East Kimberley have disproportionately targeted Aboriginal people.¹⁴ The Parliamentary Joint Committee on Human Rights found that the IM measures are likely to disproportionately impact on Aboriginal people and therefore may be indirectly discriminatory.¹⁵ Aboriginal people continue to make up the overwhelming majority of IM participants,¹⁶ with national and international human rights bodies expressing concern regarding the targeting of Aboriginal people by IM.¹⁷ The United Nations Committee on the Elimination of Racial Discrimination has previously raised concerns around the discrimination faced by Aboriginal and Torres Strait Islander people and recommended that Australia maintain only opt-in forms of social security quarantining.¹⁸

Remote Employment

The number of Aboriginal people receiving welfare on a long term basis can be directly correlated with the failure to close the employment gap and address the underlying causative factors of unemployment in remote areas¹⁹ (i.e. lack of appropriate employment opportunities that take into account mobility, flexible working practices that accommodate cultural obligations and lack of training opportunities). The Australian Bureau of Statistics (ABS) found that the proportion of Aboriginal people in remote areas who are employed has stalled or is decreasing,²⁰ meaning that people are increasingly reliant on government payments.

Not only are these payments severely inadequate,²¹ but IM does not focus on capacity building and independence and has been attributed to making people more dependent on welfare.²²

This deficit of jobs in remote communities is further impeded by the Community Development Program (CDP). The CDP is a further example of punitive, paternalistic and stigmatising policy that overwhelmingly impacts Aboriginal people living in remote and rural areas.

There are around 35,000 CDP participants, of whom roughly 80% are identified as Aboriginal and living in remote communities.²³ CDP participants are 25 times more likely to be penalised for non-compliance than non-remote job seekers, and 50 times more likely to have a penalty imposed on them for ‘persistent non-compliance’ (up to 8 weeks).²⁴ Since the introduction of the CDP, incidences of poverty crime have reportedly increased, including; breaks in (predominantly committed by children) to steal food, an increase in domestic and family violence, financial coercion, increases in mental health problems and hunger.²⁵

Further, those who have been penalised for not meeting CDP requirements were found to go for longer periods without income than those in urban areas and were less likely to be exempted from programs on medical grounds, ‘despite a much higher burden of disease in remote Aboriginal communities.²⁶ The most penalised cohort were men aged under 35 who had lower English literacy levels, lower education level, limited online access to deal with Centrelink and less mobility.

Along with the punitive and harmful aspects of the CDP, it does not address the deficit of jobs in remote communities and does not focus on developing the labour market, instead acting as penalising welfare program. Fair Work and Strong Communities is a proposal for a remote development and employment scheme, that would create up to 5,000 jobs in communities by providing wage packages to enable ACCOs to take on new workers.²⁷ As APO NT states “creating real jobs in real communities will have a far more positive impact on the lives of Aboriginal people than continuing and expanding compulsory IM.”²⁸

As opposed to directing spending towards punitive programs with no strong evidence as to their success, the Australian Government needs to invest in programs that are driven by communities and for communities that will result in long term, beneficial outcomes.

Access

As established in the previous submission to Senate Community Affairs Legislation Committee Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019 (Attachment A), NTCOSS holds specific concerns regarding the Minister’s powers to alter the percentage of a payment that is quarantined.

While the majority of people on IM in the NT have 50 per cent of their payment restricted (70 per cent for those on the child protection measure), and this will reportedly be maintained under the CDC, the new Bill grants the Minister the ability to alter this percentage up to 80 per cent with limited scrutiny.

Considering all other CDC sites have 80 per cent of participants’ payments quarantined, NTCOSS holds concerns regarding the Government’s commitment to maintain the NT as 50 percent. Quarantining larger portions of payments further limits people’s ability to access cash and ability to purchase essential items in the cash economy (such as second-hand goods).

Further, technical issues impacting access to services in remote communities mean that participants are restricted not only in using the card if electronic payment methods are not functioning, but accessing support services in replacing lost or stolen cards as well as applying to exit IM as a participant. As established by APO NT, internet and mobile phone coverage are not guaranteed in communities, technological proficiency is not high and English can be a third or fourth language for many.²⁹ With limited support from Centrelink and access to a single phone for queries and complaints, there are significant challenges for people living remotely.³⁰

This is significant not just in terms of access to money, but also in terms of impeding on participants ability to seek an exemption from participating in the program. The exemption process, as established in the Cashless Debit Card Exit Application form,³¹ largely relies on an individual’s ability to have reliable access to telecommunications and liaise with the Department.³² Noting the low rate of exemptions for Aboriginal participants applying to successfully be removed from compulsory IM in the NT,³³ with only 4.9% succeeding upon application to exit IM compared to non-Indigenous people,³⁴ introducing further obstacles that impede on an individual’s ability to navigate this process is of great concern. Considering Aboriginal people make up the overwhelming majority of IM recipients, and reports that those who voluntarily partake in IM are the cohort of people who are most interested in continuing it, it seems punitive to expand the CDC in line with the amendments outlined in the Bill.

NTCOSS also echoes Tangentyere Council’s concerns regarding the introduction of the CDC and its management by Indue, particularly noting concerns around the lack of a shopfront, the introduction of a new financial institution and concerns regarding the compliance and security regulations that they are expected to comply with, along with lack of digital accessibility.³⁵

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