There's something worse than a cashless welfare card out there in the darkness

What could possibly be worse than the Turnbull Government's Cashless Debit Card which will eventually cover all government cash transfers to individuals except Age and Veterans' Affairs pensions?

The answer is - welfare payments being converted into 50 per cent Cashless Debit Card and 50 per cent a generic low grade, nutritionally suspect, weekly or fortnightly processed, tinned & dry goods food parcel.

Such as this proposed program......

Vibe, 13 February 2018:

In Donald Trump's budget proposal, America's poor is hit the hardest, including Supplemental Nutrition Assistance Program (SNAP) recipients. The plan proposes a $17.2 billion-cut to the program by 2019 and will replace monthly cash benefits with a food box delivery program, according to reports.

White House budget director Mick Mulvaney compared the program to Blue Apron, an ingredient-and-recipe meal kit service. The Chicago Tribune notes SNAP provides roughly $125 per month to 42.2 million Americans, and the Agriculture Department would use part of those benefits to buy and deliver boxes of "homegrown" food. It's called "America's Harvest Box."

The Harvest Box would contain things like shelf-stable milk, juice, grains, cereals, pasta, peanut butter, beans, canned meat, poultry or fish, and canned fruits and vegetables. Since the boxes are valued at half of SNAP recipients monthly benefit, the remainder of their benefits would be put on electronic benefit cards, CNN Money reports.

The existing US Supplemental Nutrition Assistance Program offers about 46 million low-income Americans an allowance to buy from grocery stores and farmers markets a wide range of breads, cereals, rice, pasta, dairy products, fresh fruits & vegetables, meats, fish and poultry, as well as seeds and plants which produce food for the household to eat. Soft drinks, candy, cookies, snack crackers, and ice cream are food items and are therefore eligible items. Seafood, steak, and bakery cakes are also food items and are therefore eligible items.

Trump intends to change this program as a government cost-cutting measure saving up to a reported US$127 billion over ten years and, have the private sector under contract give out shelf-stable food bought in bulk. No choice of food parcel content appears to be allowed - it will be one-size-fits-all.

What could possibly go wrong? So many things if private contractors of the type the Trump Regime will pick were to attempt regular food delivery to est. 46 million people.

Given the love affair that those right-wing warriors in the Liberal and National parties have with the political extremes of US Republican politics, it won't be long before the likes of Minister for Human Services Michael Keenan and Minister for Social Services DanTehan start suggesting similar food parcels as a component of the bulk Centrelink welfare payments here in Australia.  

CENTRELINK ROBO-DEBT: the nightmare continues

Given that the Turnbull Government continues to apply a faulty algorithm to Centrelink debt collection in 2018, private debt collectors remain financially incentivised to aggressively chase debts which may not actually exist, former welfare recipients may still receive debt recovery fee demands and government intends to expand collection to other groups/forms of declared income, while Minister for Human Services Alan Tudge is yet to fix the problems with ‘phone wait times, perhaps a reminder of what the title Online Compliance Intervention actually hides and what the alternative term robo-debt  describes……..

Cory Doctorow writing in Boing Boing, 1 February 2018:

In a textbook example of the use of big data to create a digital poorhouse, as described in Virginia Eubanks's excellent new book Automating Inequality, the Australian government created an algorithmic, semi-privatised system to mine the financial records of people receiving means-tested benefits and accuse them of fraud on the basis of its findings, bringing in private contractors to build and maintain the system and collect the penalties it ascribed, paying them a commission on the basis of how much money they extracted from poor Australians.

The result was a predictable kafkaesque nightmare in which an unaccountable black box accused poor people, students, pensioners, disabled people and others receiving benefits of owing huge sums, sending abusive, threatening debt collectors after them, and placing all information about the accusations of fraud at the other end of a bureaucratic nightmare system of overseas phone-bank operators with insane wait-times.

GillianTerzis writing in Logic, a magazine about technology, 2017:

Automation is dehumanizing in a literal sense: it removes human experience from the equation. In the case of the robo-debt scandal, automation also stripped humans of their narrative power. The algorithm that generated these debt notices presented welfare recipients with contrasting stories: the recipients claimed they’d followed the rules, but the computer said otherwise.

There were few official ways to explain one’s circumstances: twenty-nine million calls to Centrelink went unanswered in 2016, and Centrelink’s Twitter account seems explicitly designed to discourage conversational exchange. One source of narrative resistance is notmydebt.com.au, a website run entirely by volunteers that gathers false debt stories from ordinary Australians so that the “scandal can't be plausibly minimised or denied.”

Over time it was revealed that many of these debts were miscalculated or, in some cases, non-existent. One man I’d read about was on a government pension and saddled with a $4,500 bill, which was revised down months later to $65. Another recipient, who was on disability as a result of mental illness, had a debt notice of $80,000 that was later recalled. A small proportion of recipients were exclusively in contact with private debt collectors and received no official notice from Centrelink at all.

Soon it emerged that social services were a lucrative avenue for corporate interests: this year’s Senate inquiry revealed that some private agencies tasked with recouping debts were working on a commission basis, pocketing a percentage of the debts they had recovered for the government regardless of their validity. (All debt notices issued by private agencies were eventually rescinded after government review in February 2017.)

The methodology of the algorithm itself was riddled with flaws. It calculates the average of an individual’s annual income reported to the Australian Tax Office …..and compares it with the fortnightly earnings reported to Centrelink by the welfare recipient. All welfare recipients are required to declare their gross earnings (income accrued before tax and other deductions) within this fourteen-day period. Any discrepancy between the two figures is interpreted by the algorithm as proof of undeclared or underreported income, from which a notice of debt is automatically generated.

Previously, these inconsistencies would be handled by Centrelink staff, who would call up your employer, confirm the amount you received in fortnightly payments, and cross-index that figure with the one calculated in the system. But the automation of the debt recovery process has outsourced authority from humans to the algorithm itself.

It’s certainly efficient: it takes the algorithm one week to generate 20,000 debt notices, a process that would take up to a year if done manually. But it’s not a reliable method of fraud detection. It’s blunt, unwieldy, and error-prone. It assumes that variations in the data sets are deliberate, and that recipients have received more than what they are entitled to. What’s more, the onus is on the welfare recipient to prove their income has been reported correctly and that the entitlements they have received are commensurate within twenty-one days.

Yet, as many critics have noted, this income-averaging method is porous. It fails to accurately account for the fluctuating fortunes of casual or contract workers, which often results in variations between the two figures. There’s also no way for the algorithm to correct for basic errors in the system’s database. It cannot yet discern whether an employer’s legal name has been used instead of its various business names—it treats them as separate entities, and therefore separate sources of income—or whether conflicting reports are caused by basic mistakes, such as spelling errors or typos. These seemingly small distinctions are ones that only a human could make. It’s no wonder, then, that conservative estimates of its error rate hover at 20 percent……

Yet the irony of stigmatizing welfare recipients is that better-off Australians are major beneficiaries of social spending. The Australian writer Tim Winton notes that the country’s middle class has “an increasing sense of entitlement to welfare,” which is “duly disbursed largely at the expense of the poor, the sick, and the unemployed.” These include tax concessions on contributions to “superannuation,” which are funds designed to help Australians save for their retirement. Such concessions are distortionary: they’re levied at a flat rate of 15 percent, rather than at a progressive rate according to one’s income, which means their benefits are reaped overwhelmingly by the rich.

The Australian Bureau of Statistics calculates that nearly one third of these concessions are claimed by the top 10 percent of income earners in Australia. Then there are policies like negative gearing, a tax concession that allows you to claim a deduction against your wage income for losses generated by any rental properties you own. (Australia and New Zealand are the only countries in the world to hold such a policy.) In addition, Australian homeowners are entitled to a capital gains tax discount of 50 percent once the property is sold.

Critics have argued that the combination of these two policies only serves to fuel investor speculation, entrench housing unaffordability, and lock first-time home buyers out of the market. But it’s easier to attack the poor than to tax the rich.

Commonwealth Ombudsman, Centrelink’s Automated Debt Raising And Recovery System:  A Report About The Department Of Human Services’ Online Compliance Intervention System For Debt Raising And Recovery, April 2017:

EXECUTIVE SUMMARY

In July 2016 the Department of Human Services (DHS) - Centrelink launched a new online compliance intervention (OCI) system for raising and recovering debts. The OCI matches the earnings recorded on a customer’s Centrelink record with historical employer-reported income data from the Australian Taxation Office (ATO). Parts of the debt raising process previously done manually by compliance officers within DHS are now done using this automated process. Customers are asked to confirm or update their income using the online system. If the customer does not engage with DHS either online or in person, or if there are gaps in the information provided by the customer, the system will fill the gaps with a fortnightly income figure derived from the ATO income data for the relevant employment period (‘averaged’ data). 

Since the initial rollout of the OCI, the Commonwealth Ombudsman’s office has received many complaints from people who have incurred debts under the OCI. This report examines our concerns with the implementation of the OCI, using complaints we investigated as case study examples. 

We acknowledge the changes DHS has made to the OCI since its initial rollout. The changes have been positive and have improved the usability and accessibility of the system. However, we consider there are several areas where further improvements could be made, particularly before use of the OCI is expanded. We have made several recommendations to address these areas......

Planning and risk management

In our view, many of the OCI’s implementation problems could have been mitigated through better project planning and risk management at the outset. This includes more rigorous user testing with customers and service delivery staff, a more incremental rollout, and better communication to staff and stakeholders. DHS’ project planning did not ensure all relevant external stakeholders were consulted during key planning stages and after the full rollout of the OCI. This is evidenced by the extent of confusion and inaccuracy in public statements made by key non-government stakeholders, journalists and individuals.

A key lesson for agencies and policy makers when proposing to rollout large scale measures which require people to engage in a new way with new digital channels, is for agencies to engage with stakeholders and provide resources for adequate manual support during transition periods. We have recommended DHS undertake a comprehensive evaluation of the OCI in its current form before it is implemented further and any future rollout should be done incrementally.

Centrelink website, 5 February 2018:

If you don’t pay your debt by the due date, we may ask the Australian Taxation Office (ATO) to send us your tax refund. If we do we’ll send you a Recovery of your Centrelink debt letter.

If you aren’t repaying your debt over time or if we haven’t agreed to extend the payment time, we may also:

* add an interest charge to your debt

* refer your debt to an external collection agency

* reduce your income support payments to help pay the amount owing

* recover the amount from your wages, other income and assets, including money you may hold in a bank account

* refer your case to our solicitors for legal action

* issue a Departure Prohibition Order to stop you from travelling overseas....

The rate of interest we apply to your debt is consistent with the current rate applied by the ATO to tax debts. 

As a new member of the UN Human Rights Council is Australia continuing to act the hypocrite?

For the second time in three months the UN Special Rapporteur on Extreme Poverty and Human Rights has written to the Turnbull Coalition Government concerning its welfare policies.

Australian-born Professor Alston has been Special Rapporteur on Extreme Poverty and Human Rights since June 2014.

The Commonwealth of Australia was elected on 16 October 2017 as a member of the UN Human Rights Council 2018-2020.

So the following news item is more than a little embarrassing with what it reveals about government policies.

ABC Radio RN Breakfast, 1 February 2018:

A top UN official has delivered a scathing assessment of Australia's welfare policies describing them as 'punitive' and harmful to women.

Australian Philip Alston is the UN's Special Rapporteur on Extreme Poverty. He accuses the government of pursuing policies that 'stigmatise' and 'marginalise' poorer sections of society.

In a letter sent to the government this week, Philip raised concerns about the planned expansion of cashless welfare cards, and their impact on indigenous communities.

The first letter dated 17 October 2017 addressed the Social Services Legislation Amendment Act 2017 (Cth) (No. 33 of 2017) and concerns that it may have a negative impact on the human rights of persons living in poverty, particularly single parents and their children, as well as expressing concerns about proposed drug testing of young people on unemployment benefits.

It would appear that the Turnbull Government’s welfare reforms make nonsense of Australia’s voluntary undertakings lodged with the United Nations on 14 July 2014 as part of its candidature for a vacancy on the UN Human Rights Council.

Preying on the vulnerable the Centrelink way

The Guardian, 17 January 2018:

Centrelink has given companies accused of exploitation and misconduct direct access to welfare recipients’ money through its automated debit system.

The companies were granted access to the Centrepay system, which allows Centrelink to deduct money from welfare payments to pay approved businesses early.

The system is designed to ensure rent and power bills are paid by giving government-approved real estate agents and electricity retailers the first bite of social security payments.

But the federal government has long faced criticism for opening up Centrepay to household appliance rental companies, which rent out white goods, mobile phones, laptops and furniture.

A 2015 report from the corporate regulator found the sector was targeting Centrelink recipients and charging exorbitant prices, often more than five times the retail price of the leased goods – the equivalent of a 248% interest rate.

An independent review of Centrepay in 2013 warned the government that lax oversight was giving unscrupulous operators access to the system, raising the risk of exploitation.

More than four years on, those risks appear to still be materialising.

Guardian Australia has found at least four appliance rental companies were granted approval to use Centrepay, despite previously being punished by the corporate regulator or placed on binding agreements to rectify potential legal breaches.

One of the businesses, Amazing Rentals, continued to hold Centrepay approval for more than two years after the Australian Securities and Investments Commission (Asic) raised concerns it had failed to comply with responsible lending obligations. Most of the customers of its Darwin store, including many Indigenous Australians, received government benefits as their only source of income.

The company was renting white goods to people who could not read the contracts and did not understand what they were signing up to.

The corporate regulator accepted an enforceable undertaking from the company in June 2015, which forced it to shut down the store for 12 months, refund customers,

“We had examples of consumers who were on disability pensions or Newstart allowance where they were literally running out of money at the end of the month because of the impact of the repayments that were being made for those consumer lease products,” Asic senior executive Michael Saadat told the ABC at the time.

Amazing Rentals was eventually stripped of Centrepay approval in September last year, about the same time it became embroiled in a massive data breach, which exposed 26,000 documents with the personal details of 4,000 people in the Northern Territory and Queensland.

Other companies still approved for Centrepay include franchise Rent the Roo, which was fined $27,500 by Asic for breaching responsible lending laws in 2013; and Mr Rental Australia, which was found to have imposed a potentially unlawful early termination fee, and was forced by the regulator to refund about 1,560 consumers more than $300,000 in total.

Centrepay approval is also still active for The Rental Guys, a company found to have failed to meet responsible lending obligations to customers mainly from regional Indigenous communities, and not verifying their ability to make the rental payments. The company also placed vulnerable customers on new contracts that imposed higher fees and removed the right to own goods once the rental period was finished.

Rent-to-buy companies approved for the Centrepay system sign contracts with customers knowing they are living on welfare payments.

Domestic Violence and the Turnbull Government's Cashless Welfare Card

The Guardian, 11 January 2018:

Domestic violence has increased significantly in the East Kimberley since the introduction of the cashless welfare card, casting doubt on the government’s claims of its success.

Police data obtained under freedom of information law shows domestic-related assaults and police-attended domestic violence reports increased in the Kimberley communities of Wyndham and Kununurra since trials began in April 2016.

Melbourne University researcher Elise Klein, who has studied the card’s impact in the Kimberley, said the data showed there was no clear evidence to support making the card permanent.

Klein lodged the freedom of information request for the police data. She said the information had taken too long to be made public.

She believes there is a link between the card, financial hardship, and family violence…..

The card is designed to prevent the spending of welfare money on alcohol, drugs, and gambling, reducing violence and harmful behaviour as a result.

Nawoola Newry has lived in Kununurra much of her life. She believes the card, which some of her family use, has done nothing to address the community’s problems.

Instead, it’s restricted the rights of community members, without increasing jobs, training, or employment opportunities, she said. 

“I don’t believe that it’s reduced alcoholism, I don’t believe it’s reduced crime, I don’t believe it’s reduced domestic violence,” she told Guardian Australia.

“There’s a lack of services, there was all these wrap-around services that were promised … we don’t see any of them on the ground.”

Late last year, the government seized on an independent evaluation of the cards, which found they were successful in addressing substance abuse, violence, and other harmful behaviour.

Then human services minister, Alan Tudge, used the report to announce new trial sites in the Kalgoorlie-Boulder region of Western Australia and Bundaberg in Queensland.

The cards were also to be made permanent in the Kimberley and the second trial site in Ceduna, South Australia......

Orima Research, which conducted the evaluation, had access to the police data on the Kimberley but did not include it in its report on the cards.

So what does Australia's public debt look like in January 2018?

As of 5 January 2018 Australian Government public debt stood at an est. $515.6 billion at face value. Six months earlier this debt had stood at est. $500.9 billion. So government debt continues to grow.

This early January 2018 public debt breaks down as:

Treasury Bonds	$477,278m
Treasury Indexed Bonds	$34,897m
Treasury Notes	$3,500m
Other Securities	$6m

Australian Office of Financial Management, 5 January 2018:

Treasury Bonds are medium to long-term debt securities that carry an annual rate of interest fixed over the life of the security, payable semi-annually.

All Treasury Bonds are exempt from non-resident interest withholding tax (IWT).

These treasury bonds were first issued between January 2006 and September 2017, with interest repayments ranging from 1.75% to 5.75% per annum due throughout 2018 and, in all but two instances the years beyond up to 2047. It is likely that at least 50% of these bonds are held by foreign investors.

The Turnbull Government appears to be using reduced government spending by way of funding cuts to essential government services and ‘reformed’ welfare payments in order to manage a portion of this debt – the remainder possibly being serviced by further bond issuance.

Given the potential to retain a higher dollar amount of cash transfers for longer periods in government coffers if the Cashless Debit Card is universally introduced for welfare recipients under retirement age, then I rather suspect that future welfare recipients may be disproportionately servicing this debt if Turnbull & Co have their way.

And while considering that growing public debt, the sustained federal government assault on safety-net welfare since 2013 and the attack on penalty rates in 2017, readers miight like to consider this……

The Australian Parliament consists of 226 elected members sitting as MPs or senators.

Between them they are reported to own 524 properties and, in addition to their salaries and any additional remuneration for ministerial position or committee membership, they also receive generous parliamentary entitlements of which they freely avail themselves:

Federal politicians claimed more than $55 million in expenses over the second half of 2015, new documents have revealed.

Federal politicians claimed almost $49 million in expenses over the first half of 2016, new documents have revealed.

The Australian, 5 January 2018:

Australians have endured their longest period of falling living standards in more than a quarter of a century as growth in costs outstripped earnings for the fifth consecutive quarter, leaving households worse off than they were six years ago.

After allowing for inflation, taxes and interest costs, average household incomes dropped 1.6 per cent in the year to September, capping a sustained fall in ­living standards that has not been seen since the 1990-91 recession.

Economists say more than half the cost increases for households are being driven by electricity, rent, health, new housing and tobacco, while modest wage rises are being partially absorbed by workers being pushed into higher tax brackets……

After adjusting for living costs, interest and taxes, average earnings in the three months to September were 0.7 per cent lower than in the same period of 2011, which marked the peak of the ­resources boom.

Over the previous six years from 2005, households had seen an average improvement in their living standards of 17 per cent.

AMP chief economist Shane Oliver said the mid-year budget update delivered before Christmas provided only limited scope for tax cuts.

“To be anything more than ‘sandwich and milkshake’ tax cuts and still maintain a trajectory ­towards a budget surplus by 2020-21, they would have to be offset by spending savings elsewhere. That is where the politics kicks in and the government has had difficulty getting things through the Senate,” he said.

Dr Oliver said if the government was successful in getting the 0.5 per cent increase in the Medicare Levy through the Senate, it would offset the benefit of any tax cut. The Medicare Levy increase is scheduled to start on July 1 next year and increase personal taxes by $3.6 billion in its first year and $4.3bn in the second.

Although living standards stopped rising after 2011, the ­decline since the middle of 2016 is new and reflects both the fall in wage growth and an increase in tax payments.

The ABS Wage Price Index shows a 1.9 per cent rise last year, but this is measured before tax and records the average increase for each job. National accounts show that personal income tax collections are rising much faster than pre-tax wages, partly ­because more wage income is being pushed into higher tax brackets. They show a 4 per cent lift in taxes per capita over the year to September, absorbing 60 per cent of the increase in wage income per person, which rose only 1 per cent.

Much of the very strong ­employment growth in the past year has been in lower paying jobs in the services sector, which has reduced average incomes overall.

Welcome to the dog whistle season in Australia

Determined to keep the pot on the boil during their extended holiday break government ministers and humble backbenchers tend to release selected dog whistles to the media .

It appears we might have Liberal Senator for Tasmania Eric Abetz to thank for this one elicited by Treasury Budget Policy Division's answer to one of his Questions on Notice on or about 11 December 2017.

SBS News, 29 December 2017:

Working Australians are forking out roughly $83 per week to fund the nation's welfare bill.

Average taxpayers are handing over $35 every week to prop up aged pensioners, $20 per week to pay for family benefits and $17 to support Australians with disabilities.

Just over $6 per week goes to the unemployed, while $9 goes towards repaying interest on government debt, according to figures released to a Senate committee.

Going to the source it appears that based on a fictional, average "someone who owes $11,424 in tax" in 2014-15, the extended estimates breakdown works out at a notional: 

$42.25 per week for health care; 
$35.03 for aged pensions;* 
$20.42 for family payments (includes child care & paid parental leave);*
$19.65 for defence of the country; 
$18.50 as the contribution to education funding; 
$17.34 to cover disability payments (includes NDIS);* 
$9.11 for interest payments on federal government debt; 
$6.26 towards unemployment benefits;* 
$4.11 other;*
$3.32 for industry assistance;
$2.94 for public order & safety; 
$2.61 for housing & community; and 
$38.11 cents per week for the remaining seven listed categories.
* Classified in the media as "Welfare" with a rounded down total of $83 a week 

Both Senator Abetz and the media remain silent on the actual cost to the average taxpayer of the full range of business/company tax concessions. They also remain silent on how individuals can structure tax offsets and investment properties in order to reduce taxable income to zero or how personal income tax rebates at the end of each financial year may affect those weekly notional figures cited as a drain on taxpayers. However, Treasury does not keep quiet on the subject of revenue foregone and helpfully releases a Tax Expenditure Statement at the beginning of each year. 

In fact if Senator Abetz wanted to be honest he would have included a question concerning financial benefits from taxation revenue going to all Australian households for 2016-17. In 2015-16 that came to $105.8 billion in federal monetary transfers derived from taxation revenue in that financial year or notionally around est. $94 a week per person based on the number and average size of all households in 2016. In addition each person would receive the equivalent of est. $40 per week as 'in kind' government goods & services.

Which means a great many working Australians receive more from the collective income tax revenue pool than they actually pay out in individual income tax. 

Indeed Treasury's 2017-18 microsimulation model of Personal Income Tax and Transfers clearly shows that, based on equivalised disposable income quintiles, an est. 60 per cent of all Australian families pay no tax or less than est. $2,000 in annual income tax once government transfers received are deducted. Included in this percentage are working families with equivalised disposable incomes below $67,000pa.

It should be noted that the aforementioned fictional person owing an estimated "$11,424 in tax" is likely to have an equivalised disposable income well in excess of $67,000pa.

Both the microsimulation model and the fictional person make nonsense of the bald assertion that; "Working Australians are forking out roughly $83 per week to fund the nation's welfare bill".

In Australia every citizen of workforce age and over pays tax - even if its just the Goods and Services Tax (GST). And every citizen of any age receives a benefit from one or more forms of tax revenue redistribution in cash and/or kind, so it is the height of hypocrisy to argue that this benefit only goes to people receiving Centrelink/Veterans Affairs payments from the state and that the entire cost of any welfare 'bill' falls squarely on the shoulders of those with other incomes. 

Whoever authorised this particular media swipe at welfare recipients has forgotten that the Turnbull Government had been putting out versions of this story all last year and, not only has it grown whiskers but the electorate has become somewhat resistant to such tired political rhetoric.

No matter how hard political commentators try to classify receiving a government cash transfer as a form of social deviance, Australian society cannot be neatly divided into "lifters and leaners", "workers and bludgers" or "us and THEM".

Over the course of a lifetime everyone of us could be considered some or all of those things at some point, as we travel from childhood dependency through to adulthood and onto the grave.

NOTE:

Australian Parliamentary Library, What counts as welfare spending?, extract, 21 December 2015:

At its broadest welfare can be used to refer to all of the programs and services that make up the welfare state. This can include health and education, as well as income support payments such as the Age Pension, Carer Payment, Disability Support Pension and Newstart Allowance.

Welfare can also refer to the administrative category of ‘social security and welfare’. This category is used in budget papers and includes spending on aged care, child care, the National Disability Insurance Scheme (NDIS), family assistance payments and income support payments.

Welfare can also refer to a much narrower (and less clearly defined) category of spending on income support payments to people of working age. These welfare payments are means-tested benefits provided in cash. They go to people of working age who are not participating in paid employment or other activities such as education or vocational training. The term welfare can be applied loosely to spending that meets some or all of these criteria. It is a moral or political category rather than a legal or administrative one. It is often associated with the idea that recipients have not earned an entitlement to payments through contributions to the community.

Use of this political category of welfare has become increasingly common in Australian political debate. The category tends to include unemployment payments, such as Newstart Allowance, and payments to people of working age claiming support on the grounds of disability or single parenthood.

Statistics on welfare spending play a central role in debates over government policy. However, in public debate it is not always clear which category these statistics refer to. Sometimes statistics that refer to the broad category of social security and welfare are presented as if they referred to the narrower political category of welfare.

If public debate is to be informed by facts, commentators need to pay close attention to the way categories such as welfare are defined. When categories remain vague and ambiguous, the statistics can conceal as much as they reveal.

Australian Labor Party will not support Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 in its current form

Labor MP for Jagajaga and Shadow Minister for Families and Social Services Jenny Macklin, media release. 5 December 2017:

CASHLESS DEBIT CARD

Federal Labor will support the continuation of the existing cashless debit card trial sites in Ceduna and the East Kimberley. 

However Labor will not support the rollout of the cashless debit card to the two new proposed sites of Bundaberg and the Goldfields due to insufficient consultation with these communities, and the widespread criticism of the evaluation and the effectiveness of the card.

After conducting our own consultations with people in Bundaberg and the Goldfields and hearing evidence from the Senate Inquiry, it has become clear that Labor cannot support Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 in its current form. 

Labor believes that there is insufficient credible evidence at this point to support the establishment of further trials of the cashless debit card. 

The flawed Orima Evaluation of the existing trials in Ceduna and the East Kimberley was inconclusive.

The Orima evaluation was subject to detailed criticism from leading academics, including Dr Janet Hunt from ANU, who said the evaluation does: “not present adequate evidence of the trial leading to successful outcomes for participants…. it is impossible to have confidence that the trial actually succeeded.”

Given the significant cost of the trials, an accrued cost of around $25.5 million or about $12,000 per participant, we must be sure that the cashless card can deliver its stated objectives. 

We have consistently said that we will take a community-by-community approach to the further rollout of the cashless debit card. 

Labor also has concerns that two years is not long enough for communities to determine whether there has been any real benefit from the introduction of the cashless debit card.

We are hearing that the communities in the existing trial sites want to continue using the card, and see the trial through.  

We will continue to support the continuation of the trials in Ceduna and the East Kimberley for these reasons. 

Labor will move amendments to the Bill to extend the end date for the trials in Ceduna and the East Kimberley to 30 June 2019 so that a proper evaluation can take place over a longer trial period. 

We have always said that we are supportive of community driven initiatives designed to tackle chronic alcohol abuse. But they must be genuinely community driven and not be part of a top-down approach. 

Labor understands that entrenched disadvantage cannot, and will not, be solved by income management alone. That’s why we have always advocated for the Government to provide additional wraparound supports to participating communities. 

We are calling on the Senate to support our amendment that funding for these vital wraparound service be guaranteed in the legislation. 

In future, Labor will only consider the introduction of any new trial sites if the Government can show that the community have agreed through a formal consultation process with the community, as well as an agreed definition of consent, and have established an evidence base through a robust and credible evaluation.

The Turnbull Government’s Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 progressed as far as it second reading and was referred to the Senate Community Affairs Legislation Committee for inquiry and report.

The final report has a single line recommendation and also contains two dissenting opinions by Labor and the Australian Greens.

The bill returns to the House of Representatives in the new year.

Labor has now baulked but is unlikely to prevail given it doesn’t have the numbers in the lower house.

"Inequality is neither a personal choice nor a national tragedy. It is a choice governments make"

Chief executive of the St Vincent de Paul Society national council Dr John Falzon, writing in The Guardian on 13 December 2017:

In 1952 a Catholic newspaper in Ireland proclaimed: “The welfare state is diluted socialism and socialism is disguised communism.”

Extreme? Yes. Dated? No. When you listen to the dying declarations of the spear-carriers for neoliberalism, it’s hard not to hear the same alarmist codswallop.

The logic goes like this: being unemployed and poor is bad because people choose to be unemployed or poor. If you receive income support, it is because you are unemployed and poor. Therefore, receiving income support is bad. Therefore, removing income support is good. Coincidentally, this means more money for the rich and less for the poor.

Social services minister Christian Porter’s recent National Press Club address was replete with denunciations of the “politics of envy” associated with redistributionist policies, as well as the “morally unacceptable” nature of social expenditure because it means placing a debt burden on the children of today to pay off as the adults of tomorrow.

These are old tropes. Joe Hockey used them regularly when he was treasurer. The intergenerational framework is always going to be a useful means of distracting from the uncomfortable reality of class inequality in the current generation.

A false divide is constructed between those who have a job (and pay taxes) and those who don’t.

It is time that we did away with this fictitious divide. It was always false. It implied that the low-paid cleaner had more in common with the mining magnate than with the person who is locked out of the labour market.

But now, especially as we try to understand the future of work and the massive changes to the structure of the labour market, it is time we consigned this nonsense to the rubbish bin of ideological history.

People who are low paid, casually employed, underemployed, unemployed, informally employed, on dodgy contracts, women who work as unpaid or low-paid carers, students who take whatever work they can get and remain silent about the indefinite training wages, sole parents, people with a disability, aged pensioners, veterans; all have more in common with each other and with other members of the working class than we dare admit.

By recognising this commonality, we can begin to reframe the way in which so-called welfare dependency and the “injustice” and “immorality” of social expenditure is presented. This is crucial at a time when the government has ruled out increasing the woefully inadequate Newstart payment, which has not seen an increase in real terms since 1994 .

The discussion needs some perspective. We have a minimum wage that sits at around 40% of the average weekly earnings and a Newstart payment that sits at around 40% of the minimum wage. The minimum wage is not a living wage and the unemployment benefit is not even a pale shadow of a living wage. And we see the consequences at the St Vincent de Paul Society every day, where topping up from charitable assistance has become the norm for many people simply to survive.

We need a solid jobs plan, and full employment should be a policy priority. Instead we keep getting served up a putting-the-boot-into-the-unemployed-plan and a slashing-social-expenditure-plan. Behavioural approaches won’t fix structural problems. The government can blame people all they like but this won’t address the inequality many are burdened with, as wages are suppressed and profits soar, buttressed by tax cuts, wage cuts and social expenditure cuts….

Our social security system was built in very different structural circumstances. The labour market is different. Work is different. We should be embarking on a serious reframing of how we can, collectively and with common resources, achieve social and economic security for everyone. We need, for example, to explore how government might play a leading role in achieving full employment instead of harassing the people who have been structurally excluded from jobs.

There is nothing innovative about marginalising people who are already made to feel that they have been stigmatised through drug-testing and cashless welfare cards.

There is nothing smart about a program like Path that uses young people for six months as cheap labour and then discards them.

We need to build a way forward that ensures that no one misses out on the essentials of life: a place to live, a place to work (or income adequacy for those who cannot engage in paid work), a place to learn (from early childhood through to university and TAFE), and a place to heal.

This means not just leaving these essentials to the whims of the market but actively ensuring that no one is excluded. This is an economic as well as a social imperative.

Inequality is buttressed and boosted by unfair rules that must be changed. We need to imagine a future predicated not on the perpetuation of inequality but the provision of social and economic security.

Inequality is neither a personal choice nor a national tragedy. It is a choice governments make.

Read the full article here.

Turnbull Government's gift to welfare recipients this Christmas? More pain....

Nothing like receiving bad news in the lead up to the festive season......

News.com.au, 6 December 2017:

CONTROVERSIAL plans to drug test unemployed welfare recipients will be suspended indefinitely after the Senate refused to endorse the idea.

The Turnbull government had hoped to drug test 5000 Newstart and Youth Allowance recipients across three trial sites in NSW, Queensland and Western Australia from January.

But Social Services Minister Christian Porter indicated this morning provisions for the pilot will be stripped from an omnibus welfare bill and dealt with separately, so other measures can be signed off by Christmas.

“There are some difficulties that are going to be presented in getting that part of the bill through the Senate, but that does not mean that we are abandoning drug testing,” Mr Porter told Sky News.

“No one can be perfectly certain with these things but my best assessment is the rest of it, everything other than drug testing, will likely succeed through the Senate.”

Minister Porter stood by the trial last month but indicated it might be split from other reforms that were crucial to overhaul the “near to dysfunctional” welfare system.

“The bulk of that bill, which reforms the compliance system, is so critical to what we are trying to achieve that I wouldn’t want to sacrifice the bulk of that in terms of timeliness while we are still negotiating around drug testing,” Mr Porter said at a National Press Club speech in November.

One reform the government wants to pass as a priority is the new “three strike” demerit point system for welfare recipients that would mean those who continually skipped appointments or job interviews would eventually lose their payments.

Another will fold seven welfare payments into one to become the main payment for people of working age.

That is slated to begin in March 2020.

According to the Australian Council Of Social Services (ACOSS) this bill:

* Sets a dangerous precedent that allows governments to determine who is covered by social security rights and protections and who is not, without legislation;

* Would make it more difficult for people to access payments;

* Will make applicants wait much longer for first payments and, in certain cases this could be as long as 26 weeks;

* Cuts payments to people seeking work by removing back-pay provisions;

* Cuts $478m from social security payments over the forward estimates, with most losses incurred by people who are unemployed and single parents;

* Rolls Wife and Widow B pensions & allowances (including the Bereavement Allowance) into the Jobseeker Payment which will leave pension recipients worse off unless they are transferred to another pension;

* Ensures that the Jobseeker Payment keeps recipients living well below the poverty line so that they will be unable to meet essential costs; and

* The new mutual obligation requirements and breach schedule indicates that annually an est. 80,000 people will lose at least one week’s payment and an unknown number up to four week’s payment.

See http://www.acoss.org.au/wp-content/uploads/2017/08/170804-Social-Services-Legislation-Amendment-Welfare-Reform-Bill-2017.pdf