Extending income management in Cape York

Image: Coen (Wikimedia Commons)

Legislation introduced into Parliament last week proposes to extend operation of income management in Cape York for a further two years until the end of 2015. This will be the third time income management has been extended in Cape York since it began in 2008. The Government argues that income management is a key element of welfare reform efforts in Cape York, which it says have 'seen improved school attendance, care and protection of children and community safety'.

New Place Based Income Management to commence 1 July

Image: Bankstown Railway Station (Wikimedia Commons)

A new form of income management being introduced next week will extend welfare quarantining to selected disadvantaged areas across Australia, targeting people involved in child protection matters and deemed vulnerable to financial hardship.

From 1 July, the Government will introduce a new form of income management to communities in Queensland, New South Wales, Victoria and South Australia.
 
So, how will the new Place Based Income Management operate and how does it differ from existing forms? Why base it in particular areas? What do we know about whether or not it is likely to be successful?

Income management: some answers to key questions

Image: BasicsCard kiosk, (Centrelink)

From 1 July 2012, income management will be extended to five new disadvantaged communities across Australia: Bankstown (New South Wales), Logan (Queensland), Rockhampton (Queensland), Playford (South Australia) and Greater Shepparton (Victoria).

While the policy of income management of welfare payments has been highly controversial, the specific details of its various forms are not generally well understood.

The Parliamentary Library has released a Background Note seeking to address this lack of understanding. It provides a brief overview of the history of income management and responses to a number of key questions about the policy.

Is income management working?




Image: BasicsCard kiosk (Centrelink)

  Much of the debate surrounding income management of welfare payments has related to the question of evidence. That is, is there evidence to justify the policy? Alternatively, is there evidence of policy failure or harmful consequences arising from income management? In other words, is income management working?

Income management (also known as ‘welfare quarantining’) refers to a policy under which a percentage of the welfare payments of certain people are set aside to be spent only on ‘priority goods and services’ such as food, housing, clothing, education and health care. Introduced by the Howard Government in 2007, income management has been criticised by some as paternalist and stigmatising.

Income management and the Racial Discrimination Act



Mick Gooda
Image source: indigenous.gov.au

In March 2011, the Aboriginal and Torres Strait Islander Social Justice Commissioner, Mick Gooda, is reported to have said that it is likely that some time in the future a complaint under the Racial Discrimination Act (RDA) will be lodged with the Australian Human Rights Commission (AHRC) in relation to income management of welfare payments on the grounds that it discriminates against Indigenous people. If any such complaint were upheld, this would be a significant test of one of the main pillars of the Australian Government’s welfare reform agenda.

What's the future for income management in the Northern Territory?

In her foreword to the Government’s recent discussion paper on the future of the Northern Territory Emergency Response (NTER), the Minister for Indigenous Affairs, Jenny Macklin, argued that lack of consultation had caused ‘ongoing anger, fear and distrust among indigenous people’ and that the next stage of the NTER would need to be based on ‘partnership with Aboriginal people’. To this end, the Government plans to consult with Aboriginal people over coming months about ‘what has worked well and where improvements can be made’.

Interestingly, the paper does not include income management as one of its ‘eight areas for future action’. Indeed, the paper argues that ‘as income management applies in other areas of Australia it is no longer part of the [NTER]’.

Child health checks and welfare conditionality: a check-up

The Government recently added child health checks to its welfare reform agenda by announcing that it would require parents of four year olds to provide evidence that their child has had a basic health assessment in order to receive the Family Tax Benefit Part A Supplement.

However, the Rudd-Gillard Government's experience to date with child health checks has been the subject of criticism by some medical experts and health sector commentators, raising questions about the likely effectiveness of the policy.

Coalition 'tough love' welfare reform proposals

The Federal Opposition has proposed a number of substantial changes to the welfare system, which it says are designed to encourage more people into work. Opposition Leader, Tony Abbott, announced the proposed changes in a speech to the Queensland Chamber of Commerce and Industry on 31 March. Mr Abbott's proposals have been subject to criticism from some commentators primarily on the grounds that they will do little to get people into work. On the other hand, some of Mr Abbott's proposed measures have gained support on the grounds that tougher measures might be required to increase workforce participation.

When Garnaut met Henry: the carbon price and welfare reform

Professor Ross Garnaut’s recent update paper no. 6 to the Garnaut Climate Change Review, released on 17 March 2011, found that ‘protecting the most vulnerable is critical to the success of the carbon price’. Professor Garnaut found that while reforms to income taxation would, for most taxpayers, assist in mitigating the effects of a rise in the price of consumer goods resulting from the introduction of a carbon price, those on little or no income could face hardship unless reforms are also made to the social security system.

Is there too much middle class welfare in Australia?

'Middle class welfare' has recently reemerged as an issue in Australian politics, primarily as a result of debates about how the Australian Government should fund infrastructure reconstruction following the floods in Queensland and Victoria. Criticisms of middle class welfare are often premised on the idea that it is a particular problem in Australia. But what is the extent of middle class welfare in Australia and should access by people on middle incomes to welfare benefits and services necessarily be seen as a matter for concern?

Child protection income management in the Northern Territory

The Gillard Government recently announced that child protection income management was being rolled out in the Northern Territory (NT). Under this program, child protection workers in the NT will be able to refer parents to Centrelink for compulsory income management when children are being neglected or are at risk of neglect.

The major parties and ‘corrosive’ welfare

Where do the major parties stand on welfare policy? In what direction can we expect welfare policy to be taken throughout the course of the next parliament? One thing clear from the election policy announcements of the major parties is that there is likely to be a further strong emphasis on addressing what each describes as the ‘corrosive’ effects of welfare.