"Another bloody bogan. Shows she can't manage her money", the Coles cashier said as Sally left the store. It was Sally's first time using the Basics Card, and things were not off to a good start.
Sally is one of about 500 residents in the City of Playford, in northern Adelaide, who have been forced onto income management. Unlike most of those on compulsory income management in Playford — about 80% of all income management clients in Playford — where the program has operated since 2012, Sally is in her late-50s and receiving the Carers Payment.
Income management in Playford is largely a youth affair, with 98% of those forced onto income management aged under 25. They are mainly young people on the Unreasonable to Live at Home rate of Youth Allowance, subject to income management solely because of their payment type and where they live.
Sally was put on the “vulnerable welfare recipient” stream of income management in November. Centrelink decided she was unable to manage her money and that she was not meeting her needs.
Sally's story captures many of the cruel aspects of income management. She argues that she is the victim of misfortune. In late 2013, her father passed away and after other family members were unable or chose not to contribute to the cost of the funeral, including bringing her father's ashes back from WA, she was left with the financial burden of several thousand dollars to bear, largely alone.
The previous year Sally's house had burned down. Both events have generated significant financial hardship for her ever since. Carers Payment, while higher than the grossly inadequate Newstart Allowance and student payments, is nevertheless a modest payment, at roughly $20,300 a year, slightly below the poverty-line.
Sally has had to apply for multiple advance and emergency payments to cover funeral costs and the cost of buying new appliances and furniture. These were the “triggers” for her to be classified as “vulnerable” and so eligible for income management.
Sally is the victim of what the Australian Council of Social Service termed in a 2010 paper on income management “double jeopardy”. She has been punished twice. First, she is forced to survive on a low income ; and second, she is deemed to suffer from “financial hardship”, precisely because of that low income . So she is forced to have half her payment quarantined, locked-up in a restricted, cashless account.
The truth is most welfare recipients experience financial hardship, not because of excessive consumption of alcohol, cigarettes, gambling, or poor financial management, but because of the low payments they receive. According to the ACOSS 2014 poverty report, 40% of Centrelink clients lived below the poverty-line.
One of the consequences of those low payments is that when things go wrong, they can go wrong very quickly and very dramatically.
An Anglicare Victoria survey from 2009 found only 2% of recipients' payments was spent on alcohol, cigarettes and gambling, whereas 70% was spent on necessities, such as groceries and housing.
Iincome management bolsters the nasty, paternalistic narrative that the poor are poor and the unemployed are unemployed because of their vices and their personal and financial incompetence and irresponsibility. Thus there is no need to raise inadequate welfare payments, or address the massive undersupply of jobs — five jobs for every job-seeker, 11 if you include the underemployed — or do anything about the lack of affordable housing.
Centrelink recently told Sally they were "concerned your rent is not being paid". But Sally's rent — and her water bill — has been automatically debited from her payments for the past three years. The result is that, apart from one instance where a rent payment was not processed because of a technical error, her rental history is perfect.
Sally is "sick of being bullied and poorly treated". During an appointment with Centrelink earlier this year, she said she was "scrutinised about her shopping choices", after receiving multiple questions about which supermarket she was frequenting.
Like many people who have been forced onto income management since the scheme started in 2007 in the Northern Territory as part the notorious Intervention, income management constantly inconveniences Sally, often forcing her to spend more money on lower quality goods.
Sally suffers from Irritable Bowel Syndrome and is gluten and wheat intolerant. She has been unable to discover a health food or specialist food store in the northern region of Adelaide that accepts the BasicsCard, and as a result she is forced to purchase more expensive, inferior goods from the major supermarkets.
Places that she expects would accept the BasicsCard — such as her local pharmacy at the Lyell McEwin Hospital, the largest hospital in Adelaide's northern suburbs — do not.
Income management "takes away your rights", Sally says. That is why she is fighting. An appeal to the Social Security Appeals Tribunal was unsuccessful — the tribunal did not take into account documents sent by Sally which they say were not received on time — but this has not deterred Sally. She is currently preparing an appeal for the next level of adjudication, the Administrative Appeals Tribunal.
About 25,000 Australians are on income management nationwide. The vast majority, about 20,000, are in the NT, most of them Aboriginal people. Last month's federal budget included a two-year funding extension, meaning that income management in the NT, Playford, and the other 14 sites where the policy operates, will now be funded until July 2017.
According to the Commonwealth Parliamentary Library, $1 billion will have been spent on income management from 2006-2007 to 2014-2015. There remains no evidence of improved financial and personal well being or of the policy helping people find work.
A 2012 Department of Families, Housing, Community Services, and Indigenous Affairs study, Evaluating New income management in the Northern Territory: First Evaluation Report, noted: “[ income management] has been applied to many who do not believe they need income management, and for whom there is no evidence that they have a need for, or benefit from income management. For many people the program largely operates more as a means of control rather than a process for building behaviours or changing attitudes or norms.”
There is, however, widespread evidence the policy stigmatises and stresses people, wastes resources that could fund community services that build people's strengths, and has the potential to make vulnerable people worse-off.
The Healthy Welfare Card, Andrew Forrest's “ income management on steroids” that would entail quarantining a much higher percentage of payments — his Creating Parity report, released last year, proposed quarantining 100% of payments of working-age Centrelink clients — looms in the background. Three sites — Ceduna, SA, Moree, NSW, and Kununurra, WA — have been canvassed as trial sites.
Like Sally, we have no choice but to continue fighting.
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