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Home News Welfare quarantining: positive evaluation for cashless debit card trial
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DEPARTMENTSDepartment of Social Services
TAGS social welfare, Welfare dependency, indigenous welfare, indigenous affairs, cashless debit card
An initial evaluation of the cashless debit card trial in remote communities shows encouraging indicators for alcohol and drug use. But nearly half of participants say it has made their life worse.
The first evaluation for the federal government’s 12-month welfare quarantining card pilot in two communities with high Aboriginal populations has demonstrated encouraging early results, notwithstanding that participants don’t like it.
The government has decided to extend the cashless debit card trial sites in Ceduna, South Australia and East Kimberley, Western Australia due to “strong independent evaluation results” conducted by Orima research, which were released earlier this week.
Results from the trial will help inform future welfare conditionality policy, which some believe the government wants to roll out more broadly.
The cashless debit card aims to reduce the effects of “welfare-fuelled” alcohol, drug and gambling abuse in communities where there was a widespread sense that such problems had been getting worse. Pre-trial consultations with community stakeholders found alcohol especially was a concern, with many believing local crime statistics actually underrepresent the true extent of crime in the community.
It works by “quarantining” 80% of a recipient’s payment on a special debit card that cannot be used on alcohol, gambling or to withdraw cash. The other 20% is deposited into a regular bank account as normal.
Participation is mandatory for all working age payment recipients who live in the selected trial sites. Wage earners, age pensioners and veterans pensioners can opt in. Both trial sites have high Indigenous populations, and the majority of participants identify as Aboriginal.
The wave one report concluded that, although many key outcomes, including crime, violence, injuries and perceptions of safety, cannot be properly examined until the next round of evaluation, “overall, the [trial] has been effective to date … in particular, the trial has been effective in reducing alcohol consumption, illegal drug use and gambling — establishing a clear ‘proof-of-concept’.”
“Over time it is hoped the card will assist people to break the cycle of welfare dependency by stabilising their lives and helping them into employment,” says the government.
The report outlines key results including:
In addition, a significant proportion of participants indicated they had been better able to care for children and save more money. There were improvements in self-reported nutrition and ability to pay bills and afford basic goods.
More than three-quarters of participants said they had not had to change where they shop since the start of the trial, indicating access to stores accepting the card was not a major issue, though there was some feedback that the quarantining made it difficult to make purchases at things like cash-only events.
Data from local partners and anecdotal feedback also indicate positive results:
“The card is a not a panacea, but it has led to stark improvements in these communities. There are very few other initiatives that have had such impact,” says Minister for Human Services Alan Tudge.
“A large part of the success has been the close working relationship with local leaders, who have co-designed and implemented the trial with us. The South Australian and Western Australian state governments have also been very supportive.
“There is still a lot of work to do, but if we can continue on this path, then over time we can make these communities safe, healthy and prosperous once again.”
Notwithstanding several positive indicators, many participants aren’t keen on the initiative.
Perceptions of the impact of the trial varied between those involved and the rest of the community. Of those interviewed, more participants — 91% of whom were Aboriginal — said the trial had made their lives worse (49%) than better (22%). Family members of trial participants gave a similar pattern of answers (37% and 27%). However, non-participant respondents — 85% of whom were non-Aboriginal — had the reverse perception, with 46% saying it had made life in their community better, and only 18% that it had made life worse.
Those who reported positive behavioural change were more likely to say the trial had made their life better, however.
There have been some side effects, including that age pensioners — who do not have restrictions on spending — report being asked for money more often by family members.
Community stakeholders also expressed scepticism about whether reductions in drinking will stick, given previous experience with restrictions, where secondary markets in alcohol and other circumventions rose over time. Some stated that at least some of the reduction in publicly visible drinking may be due to people moving into private spaces.
It is not possible at this points to determine where the cashless debit card has worked most and least successfully, as the wave one data started being collected only six months into the trial. Community leaders remain supportive of the program, however.
The trial also shows how difficult it can be to get results demonstrating a clear causal link. One of the criticisms of the trial design was that, because the community insisted as a condition of consent to the experiment on improved support services, it would be hard to tell whether any improvement came as a result of support services or payment restrictions.
But the evaluation argues the improvements appear to be primarily due to the debit card quarantining mechanism:
“as the majority of participants had not used any of the existing and additional support services provided in Trial sites, the Wave 1 survey results indicate that the debit card itself had a separate and significant impact on participants’ behaviours. The survey results were suggestive of an additive effect of services on the small proportion of the population using them, but that this was only a relatively small effect for a relatively small proportion of the total participant population.”
And although stigma is another common objection to such initiatives, only 6% of participants reported experiencing shame.
The final evaluation report is due mid-2017.
David Donaldson is a journalist at The Mandarin based in Melbourne. He's previously written for The Guardian and Crikey and holds a masters in international relations.
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This is a very naïve or pro-government report on some very dubious data and I expect more serious examination of the actual data. There is no proof that the card has reduced harm or even drinking, just reports from questionnaire where people reported they’d cut their drinking, wouldn’t you? I’d fail your analysis of research methods. Try rigor and validity!! happy to expand and send my version…
“Pensioners being asked for money” euphimism for stand over of elders, anyone on a Disability Pension or working to hand over all their cash, as the cultural practice of sharing in remote communities won’t change in the next 100,000 years, but the government will. This report is typical of Garbage In Garbage Out approach to ‘research’ ‘questions’.
Disability Pensioners have their incomes restricted in this program. It applies to every payment for everyone of “working age” – that is between 16 and 64 years. Note that state government “disaster relief” payments were made to eligible residents, but for those whose Centrelink payments are “managed”, these state government payments were also placed on the restricted card.