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What the Papers Say

No-cash card 'cuts alcohol, drug use'

A cashless welfare card that stops government benefits being spent on drugs and alcohol will be made permanent in two remote communities and looks set to be expanded further, after trials found it greatly reduced rates of substance abuse and gambling.

The Turnbull government will today release the first major independent audit of the cashless welfare system and announce that the card will continue in Ceduna and East Kimberley, subject to six-monthly reviews.

Establishing a clear "proof of concept" in the two predominantly indigenous communities also paves the way for the Coalition to roll out the welfare spending restrictions further, with townships in regional Western Australia and South Australia believed to be under consideration.

In October, Malcolm Turnbull flagged that an expansion of the welfare card was dependent on the results of the 12-month trial, but praised the scheme's initial success in reducing the amount of taxpayer money being spent on alcohol and illicit drugs.

Under the welfare shake-up, first flagged in Andrew Forrest's review of the welfare system in 2014, 80 per cent of a person's benefit is restricted to a Visa debit card that cannot be used for spending on alcohol or gambling products, or converted to cash.

After year-long trials at the two sites capturing $10 million in welfare payments, the first quantitative assessment of the scheme has found that 24 per cent of card users reported less alcohol consumption and drug use in their communities, with 27 per cent of people noting a drop in gambling.

Binge drinking and the frequency of alcohol consumption by card users was also down by about 25 per cent among those who said they were drinkers before the trials began.

Those not on welfare saw even greater benefits, with an average of 41 per cent of non-participant community members across the two trial sites reporting a Continued on Page 2 Cashless welfare card 'cuts use of alcohol, drugs' Continued from Page 1 reduction in the drinking of alcohol in their area since the trial started. The report concluded that, overall, the card "has been effective in reducing alcohol consumption, illegal drug use and gambling - establishing a clear 'proof-ofconcept' and meeting the necessary preconditions for the planned medium-term outcomes in relation to reduced levels of harm related to these behaviours".

However the audit, undertaken by ORIMA Research, found that despite the community improvements, many people remained unhappy with the welfare restrictions, with about half saying it had made their lives worse, and 46 per cent reporting they had problems with the card.

This view was reversed in the wider community, with 46 per cent of non-participants saying the trial had made life in their community better, and only 18 per cent reporting that it had made life worse. Many of the reported problems with the card were attributed to user error or "imperfect knowledge and systems" among some merchants. Of the 32,237 declined transactions between April and September last year, 86.2 per cent were because of user error, with more than half found to be because account holders had insufficient funds.

While there was a large amount of anecdotal evidence in favour of the card, there were also reports of a rise in humbugging - where family members are harassed for money - and some reports of an increase in crime linked to the need for cash, including prostitution.

Human Services Minister Alan Tudge said while the card was not a "panacea", it had led to stark improvements in the trial communities, warranting an extension of the card, despite it not being popular with all welfare recipients.

However, he stressed that no decision had been made to expand the card to new sites, which would require legislation.

"Inevitably, people would prefer to have fewer restrictions than more restrictions, particularly if you are an alcoholic, but the evaluation and the data shows that it is having a positive net impact on reducing alcoholism, gambling and illicit substance abuse," Mr Tudge said. "The rights of the community, of the children and of elderly citizens to live in a safe community are equally important as the rights of welfare recipients." The government has introduced the card only to regions where it has the support of community leaders, allowing the Coalition to secure the backing of Labor for the two trial sites despite opposition from the Greens and the Australian Council of Social Service.

Liberal MP Melissa Price, who represents the vast West Australian regional electorate of Durack, said yesterday she was hopeful the card could be rolled out across the Kimberley, the Pilbara and the Goldfields, estimating that about half of the 52 councils in her electorate had expressed an interest in signing up.

"I know it is not popular with everybody, but we are in government and we need to make these decisions to improve people's lives; if we don't make changes, nothing changes," Ms Price said.

Source: The Australian.

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