Australia’s prime minister is considering plans to launch a cashless debit card for welfare recipients.
During an interview with Nine newspapers published on Sunday, Prime Minister Scott Morrison stated welfare reform would be treated with importance and urgency by his government, adding that he was eyeing plans to launch a cashless welfare card – in a bid to avoid welfare payments from being spent on alcohol, drugs and gambling.
Morrison also supported a proposal to conduct drug tests on some of the people searching from employment, placing the government on a crash course with opposition leaders and regulators and welfare groups.
The Premier has fought pleas to hike payments to welfare recipients, in spite of the increasing support for a raise from a mixture including welfare groups, business leaders, opposition lawmakers and some of the members of Morrison’s own ruling coalition.
As it is more commonly known, the cashless welfare card is a debit card distributed to people on welfare. The idea is simple: most payments will go directly into this card rather than the recipient’s bank account, with the aim of preventing welfare payments from being used for alcohol, gambling products (excluding lottery tickets) and gift cards used for the purpose of purchasing alcohol or gambling goods. It also cannot be used for the withdrawal of cash.
Trials for these cards have being run in a number of areas since 2016, including the Ceduna region in South Australia, East Kimberley and the Goldfields region in Western Australia and in Bundaberg and Hervey Bay in Queensland.
In Queensland, only people aged 35 years or younger receiving Newstart, Youth Allowance of a parenting payment are eligible to the trial.
Although the cards to not include all of the recipient’s welfare payments, 80% are sent to the card and only 20% are deposited in the individual’s bank account. Welfare bank accounts restrict the amount users can transfer to their own bank accounts to A$200 every 28 days, in order to ensure than recipients do not end up with over 20% of their welfare in cash.
Morrison is considering the national distribution of the cards as part of his “compassionate conservative” welfare program, which includes the trials for drug-testing job seekers.
Early in September, the Australian Prime Minister said: “Welfare is about helping people to become self-sufficient, in my view, where you’re able to do that.
“And where you’re not, to make sure you’re providing that support to be able to deliver, you know, a good life. And that’s hard to do when you’re completely income-dependent on the government.”
The government has hired a business services company Indue to roll out the debit cards.