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A new bill has been introduced to the House of Representatives to curtail the use of Cashless Debit Cards (CDCs) for older Australians.

The intention of giving welfare recipients this card was to prevent them from spending on substances which are harmful, with 80% of their welfare payments ‘quarantined’ on the card. Purchases on alcohol, gambling or cash withdrawals are not allowed.  Is this reasonable

The Bill, entitled Protecting Pensions from the Cashless Debit Card was introduced on October 25 by Labor MP Julian Hill and seconded by fellow Labor member, Justine Elliot.

How does the cashless welfare card work?

According to the Department of Social Security (DSS), the objective of the CDC is to ensure that welfare payments are spent in responsible and meaningful ways.

The card has been on trial for five years and 12 months ago the Federal Government sought to end the trial period and make the card permanent. This legislation did not pass the House, so the trial is now due to expire end December 2022.

Management of the card is outsourced to a private company, Indue. A recent report in the Guardian claims that Indue is receiving $26 million for managing the program over a 2-year period. Indue was also the recipient of $2.1 million in Jobkeeper subsidies despite an increase in profit over the same period.

The Labor Party maintains that the government has plans to increase coverage of the CDC to Age Pensioners. The government denies it has any plans to extend the card to include more pensioners. There are currently only a handful of Age Pensioners on the card, some of whom volunteered, others under order from a Family Responsibilities Commission.

Does the card work?

Reports on the efficacy of the trial are mixed, however. One report claims there has been no positive impact, another was inconclusive.

What does appear to occur is that some card holders suffer difficulty when their seemingly innocuous purchases (textbooks, bras), often online, are rejected.

And there may be gaps in resolving card issues between the card issuer (Indue) and the responsible department (DSS). Directions on the DSS website point users to Indue in the first instance via a link or to a Hotline (1800 252 605).

Cardholders can also request to be taken off the program. These requests are reviewed by the department.

What do you think?

Do you believe this is a good system to help those who have addiction issues?

Or do you believe it is never okay for the government to tell you how to spend your payments?

 

ps Regardless of how you feel about the card it is important to ensure you’re getting all your entitlements.  You can check yours on our free eligibility calculator