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As Labor abolishes the cashless debit card, it has retained the racialised BasicsCard that overwhelmingly targets First Nations people



Before the election, Labor promised to “abolish” compulsory income management and the cashless debit card. It was part of a commitment to lift people out of poverty and make the welfare system fairer.

But the party’s Social Security Amendment Bill, which passed the house of representatives in the most recent sitting, doesn’t end the paternalistic income management scheme. Instead, it reforms the cashless debit card all the way back to its racist roots.

The bill puts an end to private companies, namely Indue, being able to profit from administering the card. But hidden in the fine print and not featured in Labor’s victory laps are some key details.

Most importantly, the legislation maintains the government-administered BasicsCard, the original income management scheme born out of the 2007 Northern Territory intervention. Overwhelmingly, the card affects Indigenous people.
“There should be a review of the BasicsCard, which would be best done in conjunction with a review of the social security system, particularly its fairness and adequacy in how it applies to Indigenous communities.”

According to the office of Social Services Minister Amanda Rishworth, there were 17,322 participants across seven trial sites. More than half of those under the scheme were Indigenous, including 77 per cent of participants in the Northern Territory, 84 per cent in the East Kimberley and 75 per cent in Ceduna, South Australia. In Bundaberg and Hervey Bay, 18 per cent of the 4709 participants were First Nations, while in the Goldfields it was 48 per cent of the 2805 participants.

Another major revelation is that not all of the 17,322 participants across the seven cashless debit card trial sites will be transitioning off compulsory income management. The 3846 people in the Northern Territory will be involuntarily transitioned from the privatised cashless credit card back onto the BasicsCard, whereby 70 per cent of their welfare payment will continue to be quarantined.

These 3846 people, 77 per cent of whom are Indigenous, will join the other 24,405 people on the government-administered scheme. According to the government’s June data, 22,787 of these people are located in the Northern Territory, with 20,802 of those on compulsory income management. Of the latter, 77 per cent are also Indigenous – with the majority categorised as “disengaged youth” or “long-term welfare participants”.

While Rishworth’s legislation will allow 13,476 people to transition off the scheme, the present changes return income management to being almost exclusively for Aboriginal and Torres Strait Islander people.

The Greens continue to be the only party maintaining an abolitionist position for all income management schemes, one they’ve held since the schemes were introduced. The Coalition is adamant that the cashless debit card system should continue to be imposed on the nation’s most vulnerable.

Leading the charge against Labor’s changes is Country Liberal senator Jacinta Nampijinpa Price. Earlier this week, Price told the ABC that “this is about, again, taking away the rights of the vulnerable and prioritising the rights of those who perpetrate violence, who’d like to be able to have access to alcohol to feed their alcohol addiction, who are quite regularly involved with the justice system because of their lifestyles”.

The senator’s commentary positions the abject poverty that so many Indigenous people have been indentured into as a culmination of individual choices and not an intentional structural outcome induced by ongoing colonisation.

Despite the fact that compulsory income management was born out of the 2007 Northern Territory intervention – when John Howard, in an authoritarian way, invoked martial law and imposed a renewed suite of race-based controls on Aboriginal people and their lands – Price wrongly echoes the view that the scheme was designed to liberate rather than control.

John Paterson, chief executive of the Aboriginal Medical Services Alliance Northern Territory (AMSANT), says that “the focus of income management should be on individuals managing their income, not the government”.

He says the system requires an overhaul that isn’t contained in the Rishworth bill. “There should be a review of the BasicsCard, which would be best done in conjunction with a review of the social security system, particularly its fairness and adequacy in how it applies to Indigenous communities,” Paterson says. “We do not support the expansion of the BasicsCard as such or its compulsory elements.”

The BasicsCard was initially imposed on 73 Aboriginal communities and was provided safe passage due to the suspension of the Racial Discrimination Act (1975). It was introduced alongside an increase in police and powers; the appointment of managers to oversee 73 prescribed communities; prohibition of alcohol and pornography; the quashing of the permits for entry system; military health checks of Aboriginal children; the abolition of Community Development Employment Projects and their replacement with Work for the Dole; the compulsory acquisition of townships through renewable five-year leases; and the removal of traditional cultural considerations from judicial-criminal proceedings.

Labor provided bipartisan support for Howard’s Northern Territory intervention – so much so that they extended the intervention for an additional decade. Labor has now pledged to conduct “thorough consultations” on the future of the BasicsCard.

“We are taking our time with determining the future of the BasicsCard,” Rishworth told The Saturday Paper.

“Right now we are focused on the cashless debit card and abolishing that. That needs to be done in a safe way and we know that ‘buy now, pay later’ arrangements mean it will be harder to unpick,” she says.

“We’re taking this on a community-by-community basis and we want to consult widely around what this will look like. There is a lot to unpick so we want to get this right.”

In late 2009, the Senate Community Affairs Committee held an inquiry into income management legislation and its proposed changes. Of the more than 80 submissions received, nearly all those covering income management opposed its extension. This included submissions from groups such as the Australian Indigenous Doctors’ Association, the medical group AMSANT, and various land councils, as well as objections from major welfare agencies.

John Paterson said that AMSANT’s position hasn’t changed: “There is no evidence that compulsory income management works. We have not supported compulsory income management and did not support the privatised cashless debit card.”

Despite the overwhelming opposition and still not having an explicit explanation of how the precise mechanism of income management is intended to work – as well as no empirical evidence to support its existence, let alone its expansion – Kevin Rudd and Jenny Macklin, who was then minister for Families, Housing, Community Services and Indigenous Affairs, decided to expand income management across the entire Northern Territory in July 2010.

Described as the “first step in a national rollout of income management in disadvantaged regions”, the geographic expansion of the cashless debit card was coupled with broadened criteria for eligibility. With income management already tied to school attendance, Labor expanded the web of surveillance on Aboriginal communities by giving social workers and child protection authorities greater referral powers, ultimately creating more on-ramps into the scheme.

These intentional modifications, which carefully maintained the integrity of the scheme’s initial design, were enough to successfully reinstate the Racial Discrimination Act (1975), creating a scenario where Labor could usher more Aboriginal and Torres Strait Islander people onto income management under the guise of fairness, continuing to shift the blame for Aboriginal people’s material conditions onto the individual and away from policymakers.

As Labor expanded income management across the rest of the Northern Territory, it also began rolling it out in places such as Cape York, the Kimberley and Kalgoorlie – locations with high populations of Indigenous people.

By April 2012, a total of 17,567 people were subject to income management in the Northern Territory, 90 per cent of whom were Indigenous. In Cape York, the entire income management population was Indigenous and in Western Australia 71 per cent of the income management population was Indigenous.

The history of income management is fraught, and its founding purpose was to further control the lives of Indigenous people. The small percentage of non-Aboriginal people who have been subjugated to this punitive scheme, many of whom are old, disabled, impoverished and unable to work, have been deemed as the necessary collateral damage by successive governments.

Rishworth’s bill reinforces this. It again racialises the welfare system and forces Aboriginal people into a scheme that was developed to punish participants rather than to empower them.

Ben Abbatangelo is a Gunaikurnai and Wotjobaluk writer.

Feature image – Social Services Minister Amanda Rishworth at a meeting on women’s safety this month. Credit: Facebook

This article was first published in the print edition of The Saturday Paper on August 13, 2022 as “Getting the basics wrong”.

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