Is the cashless welfare working?

The cashless welfare card being trialled in Ceduna, SA, and East Kimberley, WA, has shown signs of promise, with pokie spending down 15 per cent and reduced rates of drug-taking and alcoholism, but is it enough to warrant the program being expanded across Australia?

Early reports seem to suggest that it may well be enough, with around half of the Ceduna community noticing less drinking in the area – in fact, eight out of 10 card users now say they drink less. Around one in five say that they are using illegal drugs less.

The Mayor of Ceduna, Allan Suter, claims that the cashless welfare card is “the best thing we’ve ever had”.

Figures from the report show that spending on pokies has decreased by around $100,000 since the card was introduced to the area. There was also a noticeable decrease in people accessing homelessness services, with 253 seeking help during the last quarter, compared to 491 in the same period last year.

Other positive effects of the trial include more spending on fresh fruit and vegetables, fewer admissions to the sobering-up unit and decreased admissions to the emergency department for alcohol-related issues.

It is worth pointing out, however, that the preliminary report is based on small numbers and specific timeframes. The cashless welfare trial is due to finish in two months, and a full report will be compiled mid-year.

Welfare recipients on the cashless welfare card trial have 80 per cent of their benefits deposited into a debit card. Those benefits cannot be withdrawn as cash, leaving only 20 per cent available to them in physical money. The card, co-designed by indigenous leaders concerned by drug and alcohol dependency and gambling problems in the community, has been widely accepted in Ceduna and the East Kimberley.

Human Services Minister Alan Tudge is encouraged by the positive early signs.

“The document is not public yet, but we are encouraged by the progress being made in reducing the gambling and alcohol consumption which underpins so much of the social problems,” said Mr Tudge.

Although the trial exhibits many positive signs, there are still some negative effects. There have been reports of recipients changing their address to bypass the trial, concerns about a black market for cash and instances where a recipient asks a cab driver to charge them double for a fare then requests the difference in cash.

The Greens are concerned that the drop in alcoholism and drug use could lead to increased instances of domestic violence.

“I’d also be very interested to see if there’s any information around the reported rates of domestic violence,” said Independent South Australian Senator Sky Kakoshke-Moore.

Despite mixed reports about the trial’s efficacy and protestors saying that the card is a breach of human rights, Prime Minister Malcolm Turnbull is reported to be considering rolling it out across the country.

Read the Cashless Debit Card Trial overview
Read the Ceduna Mayor’s message

What do you think of the early findings? Would you be happy having your benefits deposited in such a card? Do you think the card is a breach of human rights?

Related articles:
Cashless Welfare Card Trial in SA
Cashless Welfare Card to be trialled

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