Speech – Social Security (Administration) Amendment (Income Management Reform) Bill 2023

House of Representatives – Thursday 23 2023

10mins

Deputy Speaker,

I rise to speak to the introduction of the Social Security (Administration) Amendment (Income Management Reform) Bill 2023.

This Bill delivers on the Australian Government’s election commitment to reform Income Management.

It is the product of meaningful community consultation.

The Bill proposes amendments that will give effect to the broader roll out of enhanced Income Management.

It focuses on expanding access to a modern financial experience provided through the enhanced Income Management regime and SmartCard.

It also takes further steps to address the clear message given by the Senate legislative committee that the BasicsCard is out of date.

The Government has listened to feedback from communities that BasicsCard technology is out of date and does not meet their needs.

The service offering of the BasicsCard has become increasingly out of step with modern expectations.

The former government did not invest in the BasicsCard because they were focused on pushing more people onto their privatised Cashless Debit Card.

The Bill will give access to a modern financial experience for all new Income Management participants by providing a contemporary debit card and associated bank account.

The Bill provides all existing Income Management participants a choice to move to enhanced technology until a decision is made on the future of the BasicsCard.

Users currently on the BasicsCard will have the choice to transition to the SmartCard.

This Bill also ensures that new entrants will not be placed on the old technology of the BasicsCard.

And that’s a very good thing.

Because the BasicsCard is only accepted by pre-approved merchants, limiting where people can shop, which restricts where people can spend their money.

Currently, if a BasicsCard holder attempts to shop outside the available permitted merchants, they are shut out of often legitimate transactions purely because of restricted technology.

And that can unfairly stigmatise BasicsCard users.

The SmartCard will give participants a better experience with increased choice on how and where they can spend money.

The more modern SmartCard also provides banking functions including ‘tap to pay’ payments, online shopping, and BPAY bill payments.

Importantly, the SmartCard is delivered by Services Australia and has a PIN number for added protection.

The updated SmartCard technology reduces the likelihood that a welfare payment recipient will be subject to undue harassment or rejection of legitimate in-store payment because of their welfare status.

Card users shouldn’t be rejected simply because that business has not been signed up to accept the BasicsCard.

With this Bill the Albanese Government will deliver more choice through the SmartCard, which is a better product with modern financial technology that will meet community expectations and do so at a cheaper cost than the previous Cashless Debit Card.

The privatised Cashless Debit Card has now been abolished.

All compulsory welfare quarantining in Cashless Debit Card regions have ended.

And on 6 March former Cashless Debit Card participants in the Northern Territory and Cape York and Doomadgee region transitioned to the new enhanced Income Management program.

Our work now is to support these communities.

The October Budget allocated $217.7 million to abolish the Cashless Debit Card program and fund support services.

$158.4 million – over 70 per cent of this funding – will be used to provide support services to people in former Cashless Debit Card program communities.

This includes support for a Youth Mentoring Program in Ceduna which runs activities including after school and holiday care, parenting education and support in Wyndham, community navigator programs, and financial literacy and digital literacy.

The Government is also investing $17 million for an economic development grant round which is currently under way to implement projects to create sustainable jobs in Ceduna, East Kimberley, the Goldfields, and Cape York and $1.5 million for immediate community priorities in these regions.

This Government understands that decisions that impact First Nations people must be made in a spirit of real partnership.

The Albanese Government is working with communities on what the future of Income Management looks like for them.

Any decisions about the future of Income Management will be based on genuine consultation with communities, state and territory governments and experts in the field.

We’ll keep getting on with the job and will reform Income Management to provide a better experience for participants.

Deputy Speaker, this legislation is simple and directly responds to the clear message given from individuals and communities where Income Management operates that the BasicsCard is out of date and does not meet their needs.

That is why, as I have highlighted, this Bill will ensure no new Income Management participant is issued a BasicsCard. 

It’s important to note that while the Bill offers existing participants the choice to access enhanced Income Management, it does not expand on the existing legislation.

Existing Income Management participants will have the choice to move to enhanced Income Management and will receive the necessary support from Services Australia when they choose to do so.

Services Australia currently supports Income Management participants and will continue to do so for all who choose to move to enhanced Income Management.

Services Australia is providing all aspects of client interface for enhanced Income Management.

This is a significant change from the Cashless Debit Card program, as individuals will interact with Government rather than a private business to check balances, get a replacement card, or get advice on how to set up a regular payment.

With Services Australia delivering enhanced Income Management, rather than a private third-party interface, this support will be available to provide not only income management support but also support in other areas.

Individual support, tailored to the needs of each participant, will include assisting them to set up new regular payments for bills or other essential services.

For many people, moving to the SmartCard may mean they need help to learn how they set up their rent payments and other deductions.

And that is where Services Australia’s support is essential.

This Bill is an important reform for thousands of Australians.

The Government is committed to giving more choice to the nearly 25,000 participants currently on Income Management to access superior technology.

These changes will benefit the more than 22,400 people in the Northern Territory, where I am from, who are presently on the BasicsCard.

And it will benefit the nearly 5,000 of those Territorians who are vulnerable and disengaged youth whose access to modern financial technology is delayed by the BasicsCard.

Moving to the SmartCard would have a long-term positive effect on their financial literacy.

And that’s very important, Deputy Speaker.

This reform will have a long-term, intergenerational impact on communities in the Northern Territory and across the country.

I note that this Bill does not remove the Income Management program or amend the underlying policy.

The same existing restrictions apply to an individual’s welfare payment where they meet specific eligibility criteria, to ensure a portion of their payment cannot be spent on restricted goods.

Nor does the Bill change the eligibility criteria which determine whether an individual is placed on income management.

As such, no participants will exit the scheme who would otherwise be subject to income management.

When it comes to Income Management, the rules and the laws applying in Alice Springs and the Northern Territory have not changed.

But what has changed is that users of the SmartCard will have a superior experience to the BasicsCard card.

They will have access to cutting-edge financial technology.

Will have more choice over how and where they can spend money.

And will have an enhanced user experience with Services Australia.

It is an important piece of legislation for communities in the Northern Territory and around the country.

I commend this Bill to the House.

Thanks Deputy Speaker.