Cashless Debit Card on its way out the door along with the private financial corporation which made money out of people's misery, Indue Limited

Amanda Rishworth MP, Minister for Social Services.

Labor Member for Kingston

@AmandaRishworth 

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So what do you know about the people behind management of the Morrison Government's punitive Cashless Debit Card? Perhaps it's time to meet Indue Limited's board of directors & their industry partners

 

IMAGE: news.com.au, 30.01.2019

Just as night follows day, if Scott John Morrison and the Liberal-Nationals Coalition win the federal government election, by the last quarter of 2022 he will announce all government cash transfers to citizens will in future come via the highly restrictive and punitive cashless debit card scheme.

So who has been milking the cash cow as they constructed the mechanism for Morrison's dream of a frightened, deprived and suppressed working class he could strut before?

Well that an easy question to answer - just hit this link 

https://www2.indue.com.au/wp-content/uploads/2021/10/J0982-Indue-Annual-Report-2021_WEB.pdf  and scroll down to pages 14-15 to see their six self-satisfied faces along with a brief bio.

A bit of background......

Sometime in early 2016 the Australian Government through its agency the Dept. of Social Services entered into a contract with Indue Limited, currently valued at $70,340,628.60 (original value: $7,859,509). This contract period now extends from 26-Feb-2016 to 31-Dec-2022.

Indue Limited documents clearly state that its investors-shareholders are “the owners of the company” and that those who contract the company’s services are its “clients” or “customers”.

In relation to the cashless debit card scheme it administers, it appears that the relatively large class of mandatory users of this card during this extended trial period & the somewhat smaller number of voluntary users are simply end product consumers.

How Indue Limited sees itself:……..

Indue Limited ABN 97 087 822 464 (“Indue”) is a bank and Authorised Deposit-Taking Institution (“ADI”) that is regulated by the Australian Prudential Regulation Authority. Indue is owned by financial institutions, each of which is also an ADI. Indue provides transaction processing and settlement services to credit unions, building societies, church funds, mortgage originators, commercial clients and the Australian government. Many clients would be too small individually to be able to provide a competitive alternative financial services offering without Indue.

Indue has over 40 years’ experience in the payments industry and as a financial product issuer since 1992. Indue is a principal member of Visa, MasterCard and eftpos, and holds an Australian Financial Services Licence (AFSL). It is also a reporting entity pursuant to the Anti-Money Laundering (AML)/Counter-Terrorism Financing (CTF) legislation. [Submission to the Australian Treasury. 7 September 2018, excerpt]

Indue Limited has 7 major partners which includes it being a principal member of Visa licensed to issue all Visa card products including credit, debit, prepaid, commercial and premium cards; ia member of eftpos and licensed to issue eftpos card products. These cards may be used in ATMs and eftpos terminals throughout the domestic Australian eftpos network; and, ia member of BPAY allowing us to offer both payer and biller facilities to clients.

2019-20

Indue’s vision is to be the leading partner of payment solutions to our customers. Indue’s mission is to drive competitive advantage for our customers by helping people pay….

Wholly owned Group

The Company does not have significant restrictions on its ability to access or use its assets and settle its liabilities other than those resulting from the supervisory frameworks within which Authorised Deposit-taking Institutions operate.

Transactions with related parties are conducted on an arm’s length basis….

Against this backdrop [global COVID-19 pandemic] Indue delivered a before tax profit of $3.127 million, a solid result given the prevailing headwinds…..

Events Subsequent to Balance Date

At the date of approving these financial statements, the Directors are of the view the effects of COVID-19 do not change the significant estimates, judgements and assumptions in the preparation of the financial statement…..

Likely Developments

Information on likely developments in the operations of the Company and the expected results of operations have not been included in this annual financial report because the Directors believe it would be likely to result in unreasonable prejudice to the Company. [NOTE: Likely relying on s299A(3) of the Corporations Act 2001 in order to conceal expected future progression of the federal government cashless debit card scheme]

[Indue Limited, Annual Report 2019-2020]

2020-21

It is pleasing to report a lift in profit, despite the ongoing influence of the COVID-19 pandemic. ….

A more positive outlook has contributed to our improved performance, with a Profit Before Tax (PBT) result of $3.6 million, an increase of 24% over the previous year….

An operating profit after tax of $2.583 million (2020: $2.091 million) was achieved this year….

Indue’s capital position remains sound. Our Tier 1 ratio rose to 15.5% at the end of FY21, an increase of 35 basis points on last year.

In relation to dividends, we have a good record of rewarding owners for providing investment capital. With an improved economic outlook and stronger financial performance, we are pleased to be able to declare a fully franked dividend of $7.50 per share for FY22….

After nearly 50 years, our partnership with Westpac is coming to an end in 2022. We are moving to become a Tier 1 provider for Direct Entry services, which is well-aligned to our strategy. We look forward to continuing to support our clients in this important payment channel.

Our core focus continues to be delivering sustainable value for our clients and shareholders….

We will continue to support our clients, so they can focus on growing their businesses – while we navigate the changed world of payments on their behalf….

The constitution of the Company provides for two Groups of Directors, both elected in accordance with the constitution. Group One Directors, referred to as ‘Industry Directors’, must be officers, employees or associates of a member. Group Two Directors, referred to as ‘Independent Directors’ must not be officers, employees or associates of a member. Industry Directors are not remunerated by the Company. Independent Directors are remunerated by the Company, with shareholders determining the maximum annual aggregate amount of remuneration that may be provided to them ….

The following persons were Directors of Indue Ltd during the financial year:

Chair – Non executive [Independent]

F[rank] Gullone (appointed 28 August 2020)

R Burns (resigned 27 November 2020)

Non executive Directors [Independent]

S Collier (resigned 27 November 2020)

M[ichael Francis] Currie

P[eter Robert] Townsend

P[eter Hooper] Wright

A[nthony] De Fazio

S[usan] Rix (appointed 8 January 2021) [my yellow highlighting]

A Cheadle (appointed 8 January 2021, resigned 27 May 2021)....

The Company’s Authorised Share Capital is $17.265 million. All issued shares [total of 126,182] are fully paid ….

In August 2021 Indue entered into a share buyback arrangement for a small number of issued shares….

Total Contributed Equity, Reserves, Retained Earnings, Balance at 30 June 2021 = $58,650,000 ” …..

Government grants

Government grants, including JobKeeper, are recognised when there is a reasonable assurance that the Company will comply with the conditions attached to the grant, and the grant will be received.

The Company became eligible for JobKeeper in June 2020 after meeting the specific obligations, and remained eligible until September 2020. All expected grant payments were received by October 2020…...

[Indue Limited, Annual Report 2020-2021, excerpts]

The Guardian, 4 November 2021:

*The company contracted by the federal government to run the controversial cashless debit card claimed $2m in jobkeeper payments before increasing its revenues during the pandemic.

Payments firm Indue, which was handed a $26m, two-year extension to its contract to keep running the scheme late last year, received about $2.1m in jobkeeper wage subsidies in total. That comprised $632,700 in June 2020 and $1.49m between July and September 2020, according to its annual report.

The company’s revenue increased in 2019-20 and 2020-21, leading to profit of $2.1m and $2.5m, the report shows.

Under the jobkeeper program, businesses were required to estimate whether their turnover would decrease by 30-50% when compared to the previous year, depending on their size. There is no suggestion Indue did not qualify for the payments under the rules of the scheme.

Controversially, the government elected not to include a clawback provision to recoup money from those companies that outperformed expectations…..

https://www.scribd.com/document/538531113/INDUE-LIMITED-Current-Historical-Company-Extract

A reminder that the Morrison Government's extension of the Indue Cashless Debit Card is due to commence in stages from 2021 onwards

 

"Someone in an office who doesn’t know me is in charge of my financial existence. Same abuse as my former marriage.” (R127-MNI46CDC). [Greg Marston, et al, Hidden Costs: An Independent Study into Income Management in Australia, February 2020]

The Indue Cashless Debit Card is a federal government program which locks 80 per cent of an individual's periodic social security cash transfer payments into that card and dictates what that card can be used to purchase. The remaining 20 per cent of an individual's social security payment is periodically paid into that individual's personal bank account.

The debit card program applies to every person between 15 and 65 years of age who receives a Centrelink pension, benefit or payment - other than Age and Veterans Affairs pensions which are currently exempt.

On 8 October 2020 the Morrison Government introduced into the House of Representatives the Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 which:

"Amends the Social Security (Administration) Act 1999 to: remove the trial parameters to establish the Cashless Debit Card (CDC) as an ongoing program; establish the Northern Territory and Cape York areas as CDC program areas and transition income management participants in these areas to the CDC program in 2021; remove a current exclusion to enable people in the Bundaberg and Hervey Bay program area to voluntary participate in the CDC program; enable a voluntary participant to continue to volunteer for the CDC even if they no longer reside in a program area; enable the secretary to advise a community body when a person has exited the CDC program; enable the minister to determine decision-making principles for the purposes of determining whether a person can demonstrate reasonable and responsible management of the person's affairs; enable the secretary to review a wellbeing exemption or exit determination in certain circumstances and remove the determination as a result of such a review; enable the secretary to issue and revoke a notice informing a person that they are a CDC program participant; remove the requirement that an evaluation be conducted by an independent expert of a review of the CDC program; and extend the sunset date for income management in Cape York from 30 June 2020 to 31 December 2021."

This bill reached the Third Reading stage unamended and on 7 December 2020 passed the Lower House by a vote of 62 to 61 (See list at end of post for names & electorates). It is now before the Senate.

When this bill finally becomes legislation all welfare recipients (with the exception of Age and Veterans Affairs pensioners) in the Ceduna SA, East Kimberley WA, Goldfields SA areas will be compulsorily placed on the Indue Cashless Debit Card and all persons in Cape York, Qld and the Northern Territory currently having their income managed will be compulsorily transferred to the Indue Cashless Debit Card.

This forced transfer applies even if during the trial period a welfare recipient was a voluntary trial participant and, all monies held in other income management accounts such as the Basics Card will be immediately transferred over to the forced participant's Indue Cashless Debit Card.

Welfare recipients in the Bundaberg and Hervey Bay areas in Queensland who were voluntary cashless debit card trial participants will be compulsorily transferred to the ongoing Indue Cashless Debit Card program.

The Age Pension is now included as a welfare payment which will be a restrictable payment and therefore included in the Indue Cashless Debit Card program of those who have entered or will enter the program voluntarily and can be included as a restrictable payment in the Cape York area on a case by case basis for involuntary participants.

The cashless debit card program began its trial rollout on 15 March 2016 and yet, according to card holders, after four years Indue Ltd:

• still fails to reliably make scheduled payments on time when it comes to regular mortgage, rent, electricity, gas, telephone/internet accounts due and program participants therefore incur late fees, receive letters threatening non-renewal of a lease/eviction or their credit rating begins to suffer;

• will suddenly decline payment at supermarkets, clothing, electrical/white goods and assorted other stores without explanation, even when there is more than enough money on a participant's debit card to pay;

• will reject use of the debit card for online purchases for absurd reasons - such as not allowed to buy a non-fiction book because the online bookstore might sell books on how to make alcoholic drinks and, not allowed to buy a stethoscope for educational course work because the online site sells hand sanitiser which contains alcohol as one of its ingredients: 

• still has instances where a participant's money disappears from an account which shows a credit balance and repayment of this cash transfer error is not corrected for weeks; and

• still has an IT (including AI) system vulnerable to internal/external outages which leave participants without the ability to use the debit card;

• still does not save and store the details of cashless debit card participant accounts, instead requiring the payer to enter full details for each one-off payment; and

• still has not managed a satisfactory patch of Indue app problems. 

Matters to Note:

The Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020 does not rule out the federal government increasing the number of designated program areas within the states at some future date.

At all times the federal government reserves the right to monitor how Cashless Debit Card users are spending their money.

Most of the existing financial institution guidelines and regulations do not appear to apply to Indue Ltd's contract to manage the federal government's Cashless Debit Card program and consumer protection also seems to be minimal.

It is not certain if, once the Cashless Debit Card changes from a trial to an ongoing program, it is still covered by the federal government's Financial Claims Scheme.  Nor is it certain if, on death, the balance in the Indue Ltd account of a cashless debit card program participant becomes part of their estate or if it can lawfully be retained by Indue for payment of unspecified fees and charges.

Since May 2020 Indue Ltd pays interest on the balance held in a participant's cashless debit card account. However, the interest rate is decided by the federal government so it is unlikely to ever rise higher than somewhere between 0.01 per cent and 1.0 per cent.

The total daily payment limit on the Cashless Debit Card is currently set by default at $10,000.

Indue Ltd reserves the right to charge fees in certain circumstances. See Indue Ltd Cashless Debit Card Account Conditions of Use. 

Members of the Australian House of Representatives who voted for the Social Security (Administration) Amendment (Continuation of Cashless Welfare) Bill 2020

John Alexander, MP for Bennelong (Liberal Party of Australia)

Katie Allen, MP for Higgins Allen (Liberal Party of Australia)

Kevin Andrews, MP for Menzies (Liberal Party of Australia)

Karen Andrews, MP for McPherson (Liberal National Party of Queensland)

Angie Bell, MP for Moncrieff (Liberal National Party of Queensland)

Russell Broadbent, MP for Monash (Liberal Party of Australia)

Darren Chester, MP for Gippsland (The Nationals)

George Christensen, MP for Dawson (Liberal National Party of Queensland)

Pat Conaghan, MP for Cowper (The Nationals)

Vince Connelly, MP for Stirling (Liberal Party of Australia)

Mark Coulton, MP for Parkes (The Nationals)

Damien Drum, MP for Nicholls (The Nationals)

Peter Dutton, MP for Dickson (Liberal National Party of Queensland)

Warren Entsch, MP for Leichhardt (Liberal National Party of Queensland)

Jason Falinski, MP for Mackellar (Liberal Party of Australia)

Paul Fletcher, MP for Bradfield (Liberal Party of Australia)

Nicolle Flint, MP for Boothby (Liberal Party of Australia)

Josh Frydenberg, MP for Kooyong (Liberal Party of Australia)

Andrew Gee, MP for Calare (The Nationals)

David Gillespie, MP for Lyne (The Nationals)

Garth Hamilton, MP for Lyne (Liberal National Party of Queensland)

Celia Hammond, MP for Curtin (Liberal Party of Australia)

Andrew Hastie, MP for Canning (Liberal Party of Australia)

Alex Hawke, MP for Mitchell (Liberal Party of Australia)

Greg Hunt, MP for Flinders (Liberal Party of Australia)

Barnaby Joyce, MP for New England (The Nationals)

Andrew Laming, MP for Bowman (Liberal National Party of Queensland)

Julian Leeser, MP for Berowra (Liberal Party of Australia)

Sussan Ley, MP for Farrer (Liberal Party of Australia)

David Littleproud, MP for Maranoa (Liberal National Party of Queensland)

Gladys Liu, MP for Chisholm (Liberal Party of Australia)

Fiona Martin, MP for Reid (Liberal Party of Australia)

Michael McCormack, MP for Riverina (The Nationals)

Melissa McIntosh, MP for Lindsay (Liberal Party of Australia)

Scott Morrison, MP for Cook (Liberal Party of Australia)

Ted O'Brien, MP for Fairfax (Liberal National Party of Queensland)

Ken O'Dowd, MP for Flynn (Liberal National Party of Queensland)

Tony Pasin, MP for Barker (Liberal Party of Australia)

Gavin Pearce, MP for Braddon (Liberal Party of Australia)

Keith Pitt, MP for Hinkler (Liberal National Party of Queensland)

Christian Porter, MP for Pearce (Liberal Party of Australia)

Melissa Price, MP for Durack (Liberal Party of Australia)

Rowan Ramsey, MP for Grey (Liberal Party of Australia)

Stuart Robert, MP for Fadden (Liberal National Party of Queensland)

Dave Sharma, MP for Wentworth (Liberal Party of Australia)

Julian Simmonds, MP for Ryan (Liberal National Party of Queensland)

James Stevens, MP for Sturt (Liberal Party of Australia)

Michael Sukkar, MP for Deakin (Liberal Party of Australia)

Angus Taylor, MP for Hume (Liberal Party of Australia)

Dan Tehan, MP for Wannon (Liberal Party of Australia)

Phillip Thompson, MP for Herbert (Liberal National Party of Queensland)

Alan Tudge, MP for Aston (Liberal Party of Australia)

Bert van Manen, MP for Forde (Liberal National Party of Queensland)

Ross Vasta, MP for Bonner (Liberal National Party of Queensland)

Andrew Wallace, MP for Fisher (Liberal National Party of Queensland)

Anne Webster, MP for Mallee (The Nationals)

Mrs Wicks (Liberal Party of Australia)

Mr R. J. Wilson (Liberal Party of Australia)

Mr T. R. Wilson (Liberal Party of Australia)

Ken Wyatt, MP for Hasluck (Liberal Party of Australia)

Terry Young, MP for Longman (Liberal National Party of Queensland)

Trent Zimmerman, MP for North Sydney (Liberal Party of Australia)