Bills Digest no. 94 2009–10
Social Security and Other
Legislation Amendment (Welfare Reform and Reinstatement of Racial
Discrimination Act) Bill 2009
This Digest
replaces an earlier version dated 5 February 2010 to delete one
sentence in relation to end dates and make other minor
clarifications.
WARNING:
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Bill.
CONTENTS
Passage history
Purpose
Background
Financial implications
Main provisions
Concluding comments
Contact officer & copyright details
Passage history
Social Security and Other Legislation
Amendment (Welfare Reform and Reinstatement of Racial
Discrimination Act) Bill 2009
Date introduced: 25 November 2009
House: House
of Representatives
Portfolio: Families, Housing, Community Services and Indigenous
Affairs
Commencement:
- On Royal Assent: Sections 1-4
- 1 July 2010: Schedules 2-5 (items 1, 2, 5-7), 6 (items 1-49,
51-67) and 7
- a single day to be fixed by proclamation: Schedule 5 (items 3
and 4),[1] and
- the later of (a) 1 July 2010 and (b) the 28th day
after receipt of Royal Assent: Schedule 6 (item 50).
Links: The
relevant links to the Bill, Explanatory Memorandum and second
reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/.
When Bills have been passed they can be found at ComLaw, which is
at http://www.comlaw.gov.au/.
The Bill seeks to amend several Acts relating to the Northern
Territory Emergency Response (NTER) and income management
arrangements under social security legislation.
The Bill proposes to:
- repeal provisions in the Northern Territory Emergency
Response Act 2007 (NTNER Act) which limited the application of
the Racial Discrimination Act 1975 (RDA) and State and
territory anti-discrimination laws
- ensure that measures under the NTER and Cape York Welfare
Reform Trials remain consistent with the RDA and state and
territory anti-discrimination laws
- change a number of measures associated with the
NTER—including income management—in order to improve
aspects of its operation, and
- provide the basis for the extension of income management to
disadvantaged regions throughout Australia, commencing with the
Northern Territory (NT).
Background
The measures in this Bill have their roots in three different
sets of Rudd Government policy commitments.
The first relevant policy commitment is to reinstate the RDA in
relation to the operation of the NTER. The RDA was
‘uplifted’ (suspended) in the original tranche of Bills
in which the Howard Government introduced the NTER in 2007. The
commitment to reinstate the RDA was made by the then Rudd
Opposition in the 2007 election campaign. In its October 2008
interim response to the review it commissioned into the NTER, the
Rudd Government said it would introduce in the spring sittings of
2009, legislation removing the provisions in the NTER Acts that
exclude the operation of the RDA.[2] In mid-2009 domestic and international pressure on
the Government to introduce such legislation increased, especially
with the United Nations High Commissioner for Human Rights Special
Rapporteur, James Anaya, reporting at the end of an August 2009
visit to Australia that:
Of particular concern is the Northern Territory
Emergency Response, which by the Government’s own account is
an extraordinary measure, especially in its income management
regime, imposition of compulsory leases, and community-wide bans on
alcohol consumption and pornography. These measures overtly
discriminate against aboriginal peoples, infringe their right of
self-determination and stigmatize already stigmatized
communities.
He further argued that:
… any special measure that
infringes on the basic rights of indigenous peoples must be
narrowly tailored, proportional, and necessary to achieve the
legitimate objectives being pursued. In my view, the Northern
Territory Emergency Response is not. In my opinion, as currently
configured and carried out, the Emergency Response is incompatible
with Australia’s obligations under the Convention on the
Elimination of All Forms of Racial Discrimination and the
International Covenant on Civil and Political Rights, treaties to
which Australia is a party, as well as incompatible with the
Declaration on the Rights of Indigenous Peoples, to which Australia
has affirmed its support.[3]
The Bill thus provides for the repeal of the provisions in the
NTNER Act which limited the application of the Racial
Discrimination Act 1975 and some NT and Queensland
anti-discrimination laws.
The second relevant policy commitment is to ‘closing the
gap in the Northern Territory’ and to continue those NTER
measures which contribute to that aim. In May 2009, with both the
commitment to reinstate the RDA and the need to develop a new
partnership with Indigenous Territorians in mind, the Government
released a discussion paper entitled Future Directions for the
Northern Territory Emergency Response.[4]
There then followed from June to August 2009, consultations on
the ‘redesign’ of the NTER. Redesigned NTER measures
would need to survive any legal challenges once the RDA was
reinstated while fulfilling the expectations of all concerned. On
23 November 2009, the Department of Families, Housing, Community
Services and Indigenous Affairs (FAHCSIA) released two reports on
the NTER consultations—one, a FAHCSIA report, and the other,
and an independent report it had commissioned from the Cultural and
Indigenous Research Centre Australia (CIRCA).[5]
On 25 November 2009, the Government released a policy statement
in which it set out its decisions (and the bases for them) and
introduced the awaited Bill.[6] The statement explained how NTER measures would be
modified so that they might either not be deemed discriminatory or
could be deemed beneficial forms of discrimination. The
modifications to the income management provisions are in the first
category and those to provisions concerned with alcohol, prohibited
material, the acquisition of interests in land, the licensing of
community stores and the powers of the Australian Crime Commission
are in the second category.
The third relevant government policy commitment is to introduce
major reforms to the welfare system ‘based on the principles
of engagement, participation and responsibility’.[7] Thus, on 25 November
2009, the Government announced that:
As part of major reforms to the welfare system,
the Australian Government will introduce a new [national] income
management system to protect children and families and help
disengaged individuals.[8]
The extension of income management beyond Indigenous communities
in the NT can thus be conceived not only as securing the scheme
from RDA-based challenges, but as advancing the Government’s
broader welfare reform agenda.
Indeed, it is notable that over time the Government’s
rationale for its policies on the NTER and income management has
shifted in emphasis from the need to ensure consistency with the
RDA to expressing broader longer-term policy goals in Indigenous
and social welfare policy. Thus the Minister for Families, Housing,
Community Services and Indigenous Affairs, Jenny Macklin, at the
beginning of her second reading speech placed the measures in the
Bill in the context of the need to ‘tackle the destructive,
intergenerational cycle of passive welfare’.[9] Similarly, she suggested that the
redesigning of the NTER was part of a new partnership with
Indigenous Australians and part of guaranteeing better longer-term
outcomes.[10]
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Schedule 1 makes amendments to various
Commonwealth Acts to restore the operation of the RDA.
In committing to restore the RDA while at the same time
retaining key elements of the NTER (including an expanded income
management scheme), the Government faced the problem of ensuring
that the redesigned NTER would not be inconsistent with the RDA.
This problem was highlighted in the Bills Digest for the
legislation that introduced the NTER in 2007:
However this package of legislation suspends
part of the operation of the RDA. It treats people differently on
the grounds of race (the reliance on geographic location as the
feature differentiating among Australian residents would fall with
in the definition of prohibited ‘indirect
discrimination’—i.e. the geographic feature will
predominantly affect members of a particular race. It may still,
arguably, qualify as direct discrimination). The general
prohibition has always contained recognition that ‘special
measures’ are legitimate to promote the position of members
of a particular race when that race is disadvantaged. Special
measures are also referred to as ‘affirmative action’
or ‘positive discrimination’.[11]
In other words, the operation of the RDA was suspended in order
to avoid the possibility that it might be regarded as having been
contravened by elements of the NTER (either because they treat
people differently on the grounds of race or cannot be regarded as
special measures).
As such, restoration of the operation of the RDA brings with it
the necessity to ensure that the revised NTER does not contravene
that Act. Many of the changes introduced in the remaining schedules
to this Bill (particularly those relating to income management)
should be seen in the context of addressing this problem—that
is, in ensuring that, as the Minister asserts in her second reading
speech, the NTER measures ‘are either special measures under
the RDA or non-discriminatory and therefore consistent with the
RDA’.[12]
The question of what precisely
constitutes a special measure is therefore of particular
importance. Article 1(4) of the International Convention on the
Elimination of All Forms of Racial Discrimination, from which the
RDA’s special measures are derived, provides as follows:
Special measures taken for the sole
purpose of securing adequate advancement of certain racial or
ethnic groups or individuals requiring such protection as may be
necessary in order to ensure such groups or individuals equal
enjoyment or exercise of human rights and fundamental freedoms
shall not be deemed racial discrimination, provided, however, that
such measures do not, as a consequence, lead to the maintenance of
separate rights for different racial groups and that they shall not
be continued after the objectives for which they were taken have
been achieved.[13]
The Australian
courts have interpreted this definition as containing four
elements:
- a special measure must confer a benefit on some or all members
of a class
- the membership of the class must be based on race, colour,
descent, or national or ethnic origin
- a special measure must be for the sole purpose of securing
adequate advancement of the beneficiaries in order that they may
enjoy and exercise equally with others human rights and freedoms,
and
- the circumstances of the special measure must provide
protection to the beneficiaries which is necessary in order that
they may enjoy and exercise human rights and freedoms equally with
others.[14]
Furthermore a special measure must
not be continued after the objectives for which it was taken have
been achieved.
In attempting to meet these criteria, the Government, in the
Bill, and in the supporting supplementary materials such as the
Second reading speech and the Explanatory Memorandum, outlines why
it considers that its NTER/income management measures will be
either non-discriminatory or a special measure.
For example:
- the income management scheme is designed to apply in a
non-discriminatory way to any citizen in the NT within the
specified categories[15]
- the Bill removes provisions that deem certain things to be
special measures,[16] and
- the NTER measures that are special measures ‘are all time
limited’.[17]
On this latter point for example, the Explanatory Memorandum in
discussing the measures in relation to alcohol restrictions
states:
The Government understands the important
decisions that need to be made before introducing special measures.
The Government has given careful consideration to whether these
laws are a necessary and appropriate way to address the problems
affecting Indigenous people in the Northern Territory. These
measures, as amended by this Schedule, will underpin the
sustainable, long-term development phase of the NTER. The
legislation that gives effect to these measures is time-limited,
with a clear end date, and will cease in August 2012.[18]
The Explanatory Memorandum makes this point in relation to other
measures in the Bill. Schedule 1 does not commence until the end of
31 December 2010, whereas most of the other Schedules will commence
on 1 July 2010.
The decision to remove the deeming that measures ‘are a
special measure’ reflects recommendations made by the Human
Rights and Equal Opportunity Commission (HREOC; now known as the
Australian Human Rights Commission) as part of the Northern
Territory Emergency Response Review.[19] The recommendation is to remove these
provisions and replace them with provisions with language
clarifying that measures are intended to constitute
special measures. The Government has done this in several parts of
the Bill by inserting an objects provision that uses words such
as:
The object of the Part is to enable special
measures to be taken to reduce alcohol-related harm in Indigenous
communities in the Northern Territory.[20]
However, although such specific attempts can be made to assert a
measure is a special measure and beneficial, the test will of
course be in the application and effect of the laws, and will be a
question that is to be determined by a court, tribunal or the
Australian Human Rights Commission on an evaluation of these
matters.
The Australian Human Rights Commission has issued draft
guidelines for ensuring income management measures are compliant
with the RDA.[21]
The Commission poses three key questions:
- where the measure is established by legislation, does it ensure
equality before the law?
- is the measure implemented in a way that avoids both
‘direct’ and ‘indirect’ discrimination?,
and
- is the measure a ‘special measure’?
(If a measure is non-discriminatory, it is not necessary to
determine whether it is a special measure.)
The Commission notes that a measure that has a disparate effect
on a particular racial group may be discriminatory. It is not
necessary that the measure targets a group.
What matters is the practical effect of a
measure. If in practice, it has a greater impact upon people of a
particular race, then it may be discriminatory.[22]
The Commission proposes a model that could comply with the RDA
which would comprise the following features:
- it should be subject to the application of the RDA and
state/territory anti-discrimination legislation
- it should not apply automatic quarantining—different
options that should be considered may include allowing for a
voluntary/opt in approach or a last-resort suspension approach for
income management
- it should provide for a defined period of income management,
where the time-frame for compulsory quarantining would be
proportionate to the context and/or subject to periodic review
- it must allow for a review and appeal processes, and
- it should include additional support programs that the address
the rights to food, education, housing, and provide support for
welfare recipients, safe houses for women and men, alcohol and
substance abuse programs.[23]
The first element will not be met immediately. As can be seen
from the discussion of Schedule 2 below, the
income management scheme established by this Bill would not comply
with the second element of the Commission’s model—that
is, that the scheme should not apply automatically to particular
classes of welfare recipient. Nor in all cases would it comply with
the third element that the income management scheme should provide
for a defined period of income management.[24]
In relation to the fourth element, a determination by the
Secretary is one of the requirements for a person or group of
persons to be subject to income management under the scheme. This
determination may be revoked by the Secretary on request by a
person subject to the determination. Where income support
recipients wish to apply for exemption from the new arrangements,
evidence must be provided to justify this exemption. Any person in
receipt of income support also has rights of review under Part 4 of
the Social Security Act 1991. Thus, the scheme could be
said to meet the fourth element of the Commission’s
model.
The fifth element in the model suggested by the Commission is
consistent with evidence about the kinds of assistance necessary to
bring about sustainable change in disadvantaged communities. As
will be seen below, the model of income management outlined by the
Government includes assistance for welfare recipients in the form
of financial counselling and money management services. Further,
the Howard and Rudd Governments have both provided assistance
across most of the areas suggested by the Commission above. The
difficult question is whether such assistance can be said to have
been sufficient to have addressed the rights to such things as
food, education, housing, safety and health care. There also does
not appear to be any suggestion that expansion of income management
across the NT will be accompanied by additional assistance in the
form of social services. The new model proposed meets some but not
all of these criteria.
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‘Income management’ is the term used by the
Government to refer to arrangements whereby a percentage of the
income support and family payments of certain people is set aside
to be spent only on ‘priority goods and services’ such
as food, housing, clothing, education and health care.[25] While the total amount
owing to a person subject to income management is not reduced, that
person loses the discretion to spend a percentage of their welfare
income on things other than those deemed to be priorities by the
Government.
Income management is also widely known as ‘welfare
quarantining’.
The Social Security and Other Legislation (Welfare Payment
Reform) Act 2007 (Welfare Payment Reform Act) introduced
income management for those for whom it was deemed necessary to
have some or all of their welfare payments diverted. The new
arrangements allowed for welfare payments of certain individuals to
be directly reduced and the amount diverted to be paid into a
special account. Changes to establish income management were made
to the Social Security Act 1991 (Social Security Act),
A New Tax System (Family Assistance) Act 1999 (Family
Assistance Act) and Veterans’ Entitlements Act 1986
(Veterans’ Entitlements Act).
According to the Explanatory Memorandum for the Bill introducing
the Welfare Payment Reform Act, the purpose of the changes was to
‘help address child neglect and encourage school
attendance’.[26] Under the income management scheme the Government
quarantines a specified amount of a person’s welfare payments
for use in paying for the ‘priority needs of that person,
their partner and their children’.[27] ‘Priority needs’ includes
food, housing, clothing, education and health care.[28] Payments quarantined
under income management may not be spent on alcohol, tobacco,
pornography or gambling.[29]
The Bills Digest for the Social Security and Other
Legislation (Welfare Payment Reform) Bill 2007 (Welfare
Payment Reform Bill) argued that the income management provisions
were ‘unprecedented’ because they changed the principle
of ‘inalienability’ that hitherto applied to payments
made under the Social Security Act, Family Assistance Act and
Veterans’ Entitlements Act.[30] The inalienability provisions in these Acts
previously ensured that where a person qualifies for a payment, the
payment is regarded as a legal right and cannot be either withheld
from that person and/or provided to someone else.
Prior to the introduction of Commonwealth payments for people of
working age after WWII, payments such as unemployment benefits (by
the states) were frequently paid on a conditional basis—for
example, the person had exhausted all other means of support (that
is, was genuinely ‘deserving’ of assistance).[31] At certain times, such
as the Great Depression, assistance was provided in the form of
goods (food and other necessities) rather than in cash. Such
approaches were frequently a source of resentment from many of
those requiring Government assistance. The principle of
inalienability can be largely seen as an attempt to address such
concerns.
The Welfare Payment Reform Bill that introduced income
management changed the Social Security Act, Family Assistance Act
and Veterans’ Entitlements Act to include the provision that
there will be circumstances where an individual qualified to
receive a payment will not be provided with that payment, in whole
or in part.
Thus, according to the Bills Digest for the Welfare Payment
Reform Bill:
Never before have provisions in these Acts
provided for welfare income support and supplement payments to be
withheld in part or in total. The [Social Security Act] is a
welfare act and the income support payments provisions in the
[Veterans’ Entitlements Act] are welfare provisions,
targeting income and asset tested income support payments to
persons with lesser means to support themselves. Historically,
welfare payments have been payable to the qualified person and to
no other person and are not to be withheld, hence the
inalienability sections in these Acts.[32]
Under the Welfare Payment Reform Act, a person receiving welfare
payments may become subject to income management for one of the
following reasons:
- the person is a resident of a specified area in the NT
- the person is subject to the jurisdiction of the Queensland
Commission (now known as the Family Responsibilities Commission)
and the Commission requests that the income management provisions
apply
- a child under the care of that person is at risk of neglect,
or
- a child under the care of that person is not enrolled at school
or does not attend school regularly.
The first two categories apply only to specific geographic
areas, while the second two can apply to a person living anywhere
in Australia. The specific details according to which a person may
become subject to income management were set out in legislative
instruments made under the Social Security Act, Family Assistance
Act and Veterans’ Entitlements Act.[33] Currently, eligible people living in
the Cannington area of Perth and in some locations in the Kimberley
region of Western Australia (WA) may also volunteer for income
management.[34] As
of 20 November 2009, 287 people were subject to voluntary income
management in WA.[35]
Under this category, income management applies to welfare
recipients who are residents of any of 73 specified Indigenous
communities and associated outstations in the NT. This was
established as part of the NTER and has two primary aims:
- to stem the flow of cash that is expended on substance abuse
and gambling, and
- to ensure funds that are provided for the welfare of children
are actually expended in this way.[36]
Under this category, 50 per cent of a person’s welfare
payments are quarantined.[37] As of 20 November 2009, 16 321 people were subject
to income management as part of the NTER.[38]
This category established income management as part of the Cape
York Welfare Reform Trial (CYWRT). In December 2007, this trial was
introduced in the communities of Hope Vale, Coen, Aurukun, Mossman
Gorge and associated outstations. The purpose of the trial is:
… to rebuild social norms in these
communities by linking the receipt of welfare payments to
fulfilment of socially responsible behaviours. These behaviours
focus in particular on the wellbeing education of children and seek
to respond to concerns about truancy and child neglect.[39]
The Welfare Payment Reform Act envisaged that decisions
affecting welfare payments to residents in trial communities would
be made by a statutory body created under Queensland State
legislation (the ‘Queensland Commission’). This body,
known as the Family Responsibilities Commission, was established on
1 July 2008.
Any person who is a welfare recipient living in one of the four
CYWRT communities and fits into any of the following categories,
can be referred to the Family Responsibilities Commission:
- the person’s child is absent from school three times in a
school term, without reasonable excuse
- the person has a child of school age who is not enrolled in
school without lawful excuse
- the person is the subject of a child safety report
- the person is convicted of an offence in the Magistrates Court,
or
- the person breaches his or her tenancy agreement—for
example, by using the premises for an illegal purpose, causing a
nuisance or failing to remedy rent arrears.[40]
- The FRC tells Centrelink what proportion of a person’s
payment will be quarantined (generally, 60 to 75 per cent) and for
how long.[41] As of
20 November 2009, 111 people were subject to income management as
part of the CYWRT.[42]
While child protection is generally a state and territory
matter, this category was designed to provide a Commonwealth
mechanism ‘to help ensure that parents provide appropriate
care for their children, and that the welfare income of these
parents is managed so the needs of the children are
met’.[43]
That is, welfare payments would be ‘directed to their
intended purpose so children receive shelter, food and
clothing’.[44]
Under the Welfare Payment Reform Act, a child protection officer
of any state or territory can require a person to be subject to the
income management regime. However, this category of income
management has only been formally introduced in Western Australia
(WA). This has been done in partnership with the WA Department for
Child Protection (DCP) and is supported by a bilateral agreement
between the Commonwealth and WA Governments.
Currently, a case manager from the WA DCP can refer a person to
Centrelink to have their payments managed where it is believed that
this will assist the person in ‘providing for the priority
needs of [their] children’.[45] Under income management for child protection,
Centrelink quarantines 70 per cent of a person’s payments for
use in paying for priority needs. As of 20 November 2009, 173
people were subject to income management as part of the child
protection category of income management in WA.[46]
The purpose of this category was that a person may be declared
subject to income management if they fail to ensure the enrolment
or sufficient school attendance of their children. This does not
appear to have been formally introduced as a separate category of
income management anywhere in Australia. However, in 2008 the
Government did introduce an initiative known as the School
Attendance and Enrolment Measure (SEAM) that uses possible
suspension of income support to ensure that children are
enrolled in school and attend school regularly.[47] SEAM trials commenced from the
beginning of the 2009 school year in six locations in the Northern
Territory: Katherine, Katherine Town Camps, Tiwi Islands,
Hermannsburg, Wadeye and Wallace Rockhole.
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Key features of income management in its current form
include:
- amounts diverted from a person subject to income management are
placed into a special management account for that individual
- the management account is used for the payment of expenses
associated with priority goods and services
- those subject to income management may use a
‘BasicsCard’ to access their income managed money at
approved stores and businesses using the EFTPOS system[48]
- (as can be seen above) amounts diverted under income management
vary depending on the category of income management being applied,
and
- any remaining amount in an individual’s management
account is refunded to that person when they are no longer subject
to income management.
On 25 November 2009, the Rudd Government announced that it will
replace the existing income management scheme for prescribed NT
Indigenous communities with a broader scheme targeted at
‘vulnerable regions’ and ‘individuals at
risk’.[49]
Initially, from 1 July 2010, the new scheme will be introduced
through the NT as a whole, including urban, regional and remote
areas. According to the Government, this is to be the ‘first
step in a national roll out of income management in disadvantaged
regions’.[50]
By ‘at risk’, the Government means those people who are
susceptible to social isolation and disengagement, possess few or
poor financial literacy skills and/or participate in risky
behaviours. Thus, the income management reforms are to apply to
people in the following categories:
- people aged 15 to 24 who have been in receipt of Youth
Allowance (other), Newstart Allowance, special benefit or Parenting
Payment for more than 13 weeks in the first 26 weeks (disengaged
youth)
- people aged 25 and above (and younger than pension age) who
have been in long-term receipt of specified payments, including
Newstart Allowance and Parenting Payment (long-term welfare payment
recipients)
- people referred for income management by child protection
authorities, and
- people assessed by Centrelink social workers as requiring
income management due to vulnerability to financial crisis,
domestic violence or economic abuse.[51]
Affected income support recipients will have 50 per cent of
their regular payments and 100 per cent of lump sum payments
quarantined in a separate account that may only be used for the
purchase of ‘the essentials of life’, such as food,
clothes and rent.
The stated objectives of the reforms are twofold. First, they
are intended to ensure that more of income support
recipients’ money is spent on priority items and in the
interests of children and families, rather than on alcohol and
gambling. Second, the reforms seek to improve welfare
recipients’ ability to move out of welfare dependence and
into economic and social participation. While the relationship
between income management and the first objective is obvious, its
relationship to the second objective is less clear. The
Government’s position appears to be that income management
will ‘foster individual responsibility’ among welfare
recipients which will then assist them in moving ‘up and out
of welfare dependence’.[52]
Welfare recipients may be exempted from income management
arrangements where they are able to demonstrate a record of
‘responsible parenting’ or participation in employment
or study. This could include:
- a young person in full-time study or training or engaging in
paid work
- a parent who can demonstrate that their children attend school
regularly or have up to date immunisation, or
- a long-term Newstart recipient who has a history of engaging in
work.[53]
Additional features of the new scheme include:
- matched savings incentives for those subject to compulsory
income management to help them budget and save. Those who complete
an approved money management course and have a pattern of savings
over at least 13 weeks will receive a contribution from the
Government of up to $500 and no more than 50 per cent of the costs
of household items, such as whitegoods
- access by those subject to compulsory income management to
financial counselling and money management services, and
- access by voluntary participants in income management to an
incentive of $250 for every six months that they remain in the
scheme.[54]
It appears that the existing income management trials in Cape
York and WA will continue largely in their current form. However,
there has been a change proposed to the Cape York scheme under
another Bill, the Family, Housing, Community Services and
Indigenous Affairs and other Legislation Amendment (2009 Measures)
Bill 2009. Under that Bill, the Age Pension and Carer Payment are
to be included in the category of welfare payments which may be
subject to income management for welfare recipients living in one
of the four CYWRT communities. For further information, see the
relevant Bills Digest for that Bill.
There are several important differences between the Howard and
Rudd income management schemes.
First, the Bill introducing the new income management scheme
provides for a national scheme to replace the existing scheme based
in prescribed NT communities. However, as noted above, initially it
will be implemented in the NT only. There is no information
available on when the national income management scheme is likely
to be implemented beyond the NT. As such, initially at least,
rather than a national scheme, the Rudd income management scheme
will remain largely focused on the NT (whilst continuing the Cape
York and WA trials). Therefore the extent to which the Rudd scheme
will ultimately become truly national in scope remains to be
seen.
Second, whereas the Howard scheme in the NT was compulsory for
everyone living in a prescribed community, the Rudd national scheme
is targeted to people deemed to be ‘at risk’ living in
‘vulnerable regions’—that is, initially, anywhere
in the NT. In other words, the Howard scheme in the NT was
geographically based, while the proposed Rudd national scheme is
based on a combination of geographical location and particular
categories of welfare recipient. The Rudd scheme will not
automatically include people in payments categories deemed to be
less at risk, such as Age Pension, Disability Support Pension,
Widow Allowance or Department of Veterans’ Affairs Service
Pension (unless on the basis of child protection authorities or
Centrelink social worker referral). This will address to some
extent the concerns of those in prescribed NT communities on these
‘lesser risk’ payments who believe that income
management should not be applied to them.
On this basis, the Rudd scheme can be described as more directly
targeted at people deemed to be at risk than the Howard scheme.
Nevertheless, while more targeted, the Rudd scheme remains
relatively broad in scope in that it will subject all people in the
‘disengaged youth’ and ‘long-term welfare payment
recipient’ categories to income management (unless they are
able to obtain an exemption). There are obvious administrative,
cost and other benefits associated with including all welfare
recipients in particular categories by default (with the
opportunity to seek exemptions), rather than a case-by-case basis.
Nevertheless, placing the onus on those who have become subject to
income management to prove that they should be afforded an
exemption may be regarded by some in this situation as not being
significantly less arbitrary than the current scheme.[55]
The more targeted Rudd income management scheme also raises the
prospect of having two classes of welfare recipient in the same
community—those ‘at risk’ recipients subject to
income management and those lesser risk or exempted recipients who
are not. This could have several unintended consequences. For
example, it could be a source of tension between those on income
management and those who are not. It could also create the grounds
for increased ‘humbugging’ (harassment for money) from
those on income management to those who are not. This would
potentially undermine an important objective of income
management.
Third, as outlined above, the Rudd scheme contains a range of
new incentives and services intended to change the behaviour of
those subject to (or who volunteer for) income management. It will
be important to monitor the utilisation and impact of these
programs over time. In particular, given the Government’s
emphasis on assisting people to move out of welfare dependency, it
will be important to attempt to determine whether these programs
are sufficiently funded and appropriately designed and delivered to
have the desired effect.
Back to top
The proposed introduction of a national income management scheme
has been the subject of substantial debate and controversy. As
noted above, the Howard Government NTER income management scheme
represented an unprecedented shift away from the principle of
welfare payment inalienability. The introduction of a national
scheme would clearly indicate a significant shift in
Australia’s approach to welfare payments. Australian Greens
Senator Rachel Siewert has argued that it ‘represents the
largest change in social policy by an ALP government in recent
history’.[56]
This section presents arguments for and against income
management.
There are four main arguments that tend to be made in favour of
income management of welfare payments. These arguments generally
combine moral and practical concerns and refer to:
- the responsibility of governments to welfare recipients and the
general community
- the responsibility of welfare recipients themselves to their
families, local communities and the general community
- the notion of competing rights, and
- evidence that income management has had positive effects.
Note that each of these arguments relates to the concept of
income management in general but do not constitute in themselves an
argument for any particular model of income management. One could
be generally in favour of income management in some form for any or
all of the reasons outlined below but still object to a particular
approach to income management. Indeed, prominent supporter of the
idea of income management, Cape York community leader Noel Pearson,
has argued for a targeted approach directed only at ‘people
who are being irresponsible’.[57] This contrasts with both the Howard
and proposed Rudd NT schemes which are applied in a blanket fashion
across either defined geographical locations (Howard) or welfare
payment categories (Rudd). This and related issues will be
discussed in greater depth in the section below on arguments
against income management.
An argument implicit in the Rudd Government’s statements
about income management is that governments have a responsibility
to individuals and families in receipt of welfare payments to
ensure that such payments are provided in a way that is most likely
to provide the greatest benefit. This argument suggests that, if,
as appears to be the case with some long-term welfare recipients,
some people do not have important life skills such as budgeting and
ensuring that priority needs are met, governments have a moral
responsibility to ensure that structures are in place to ensure
that the assistance they provide such people is spent
appropriately.
In this respect, income management can be thought of as
providing a ‘safety net’ to help ensure that some
people avoid (potentially) catastrophic circumstances associated
with accrual of significant debts (for example, housing and/or
utilities) and expenditure on drugs, alcohol and gambling. When
combined with other services designed to assist people in obtaining
money management and related skills (as is the case with the
proposed Rudd scheme), income management could also play a role in
equipping people themselves with the skills necessary to avoid such
catastrophic circumstances.
A related argument is that governments also have a
responsibility to the general community to ensure that, as
far as possible, welfare payments are spent
appropriately—that is, on what the Rudd Government terms
‘priority needs’ such as food, clothing, housing,
education and health care. Arguably, this is particularly important
when the needs of children are at stake. Some may also argue that
ensuring that welfare payments are spent appropriately is necessary
to ensure continued community support for such payments.
One argument made in favour of income management, mainly in
relation to Indigenous communities, is that such an approach is
necessary to assist individual Indigenous people and their
communities to take greater responsibility for their lives.
According to this argument, many of the social problems in
Indigenous communities are a result of a decline in personal
responsibility by people in these communities. This ‘collapse
of responsibility’ is related by some to the unconditional
provision of social security payments and other forms of welfare by
Commonwealth, state and territory governments.[58]
According to this argument, the key to bringing change to
Indigenous communities is to restore responsibility in such
communities through making welfare conditional on meeting certain
obligations. Thus, for some, income management has an important
role to play in assisting Indigenous people to take control of
their lives. According to this view, while subjecting an individual
to income management could be seen as violating that person’s
right to spend their income as they see fit, income management
offers the prospect of a more meaningful form of self-determination
than is able to be provided by rights-based welfare payments. This
view of self-determination is based around the idea of
‘people taking responsibility for themselves, for their own
families and for their communities’.[59]
If one accepts the view that unconditional welfare payments have
played a role in undermining Indigenous self-responsibility, this
could be seen as an additional argument for the need for the
Commonwealth to take responsibility (through policies such as
income management) for directly addressing problems that they have
had some role in creating. That is, if it can be agreed that the
form in which government assistance is paid has (in some cases)
unintended detrimental consequences, then it could be argued that
the Government has some responsibility to attempt to address those
consequences. The question then is whether income management or
some other form of intervention is the most appropriate
approach.
A related argument refers to the responsibilities of welfare
recipients to the general community. This argument suggests that
welfare recipients owe certain obligations to the general community
in exchange for the assistance they are provided. The basis of this
argument is the idea that a kind of ‘social contract’
exists between welfare recipients and the general
community—it is also central to the notion of ‘mutual
obligation’ that has been behind many welfare reforms in
recent years. According to this view, appropriate use of welfare
income can be considered to be one of the obligations owed by
welfare recipients. This is implied in the Rudd Government’s
statements about income management as a way of ensuring that
welfare is ‘spent where it is intended’—that is
‘on the essentials of life and in the interests of
children’.[60] According to this view, the right to full individual
discretion about how welfare income is spent is voided by failure
to meet this obligation.
Some argue that the rights of other affected parties (in
addition to the welfare recipient themselves) need to be considered
in discussions about income management. This case is generally made
in relation to immediate family members (usually women and
children), extended family and other community members affected by
such things as drug and alcohol abuse, violence, gambling and
humbugging.
For example, in reference to the plight of children, Noel
Pearson has suggested that critics of income management should:
Ask the terrified kid huddling in the corner,
when there’s a binge drinking party going on down the hall,
ask them if they want a bit of paternalism … Ask them if
they want a bit of intervention, because these people who continue
to bleat without looking at the facts, without facing up to the
terrible things that are going on in our remote communities, these
people are prescribing no intervention, they are prescribing a
perpetual hell for our children.[61]
Thus, while it is often criticised as
‘paternalistic’, it could also be argued that state
governments already undertake actions in defence of the rights of
children that are, in some cases, far more paternalistic than
income management.[62] Perhaps the most paternalistic of these is the
(relatively widely accepted) practice of removal of children from
their families in child protection cases. While income management
does represent a move in the direction of paternalism by
the Commonwealth, it could be argued that it is perhaps not as
dramatic a move as some have suggested—particularly if (as in
the case of both the Howard and Rudd schemes) there is no overall
reduction in the amount paid to the recipient. Further, it may also
have a preventive function. That is, for example, if it assists in
making sure that the needs of children are met, it may avoid the
need for more paternalistic interventions.
The Rudd Government has argued that evidence obtained from
various reports on the NTER provides support for the continuation
and expansion of income management. The two main reports cited in
this regard are:
- the Report on the evaluation of income management in the
Northern Territory (August 2009), a joint FAHCSIA/Australian
Institute of Health and Welfare (AIHW) report based on face to face
interviews with 76 people subject to income management in four
locations and focus groups with 167 stakeholders, and
- the Report On the Northern Territory Emergency Response
Redesign Consultations (November 2009), a report based on
Australian Government consultations with Indigenous people in the
NT about future directions for the NTER.[63]
In relation to the FAHCSIA/AIHW report, the Government has
highlighted findings that more than half of parents interviewed
reported that their children were eating more (62.5 per cent),
weighed more (57.4 per cent) and were healthier (52.1 per
cent).[64]
Additional findings of this report included:
- around two-thirds of those interviewed (65.6 per cent or 42
individuals) had a positive view of income management, while
one-third (32.8 per cent or 21 individuals) had a negative
view
- more than half of those interviewed reported that there was
less gambling (63.3 per cent or 30 individuals), less
drinking/alcohol abuse (60.9 per cent or 28 individuals) and less
humbugging or harassment for money (52.1 per cent or 25
individuals)
- three-quarters of those interviewed (75.3 per cent or 55
individuals) reported spending more on food, with half (50.0 per
cent or 37 individuals) buying more fruit and vegetables, and
- just over half of those interviewed reported that the payment
of rent (55.4 per cent or 41 individuals) or other bills (52.8 per
cent or 38 individuals) had been easier since they had been on
income management.[65]
In relation to the NTER redesign consultations, the Government
reported that ‘while there was a divergence of views, the
majority of comments said that income management should
continue’.[66] Additional findings of the report on the consultations
included:
- participants identified that income management had delivered
discernible benefits, particularly to children, women, older people
and parents and families. These included more money being spent on
food, clothing and school-related expenses; assisting with saving
for large purchases such as fridges and washing machines; less
money being spent on alcohol, gambling, cigarettes and drugs;
reduced levels of humbugging; and improved capacity for household
budgeting
- there was a divergence of views about future options for income
management, including some who suggested that it should only be
applied only on a voluntary basis
- some participants suggested that retaining the current model is
necessary for income management to be workable and to protect
vulnerable people from humbugging
- the majority of regional leaders and stakeholder organisations
consulted expressed a strong and consistent view in support of
voluntary and trigger-based models for income management. Suggested
triggers included child neglect or abuse, failure to send children
to school, convictions for alcohol or drug related offences,
vulnerability to humbugging, or an express request to participate
in income management, and
- participants also expressed a strong preference that
communities themselves should actively be involved in making
decisions about income management.[67]
As will be discussed in the following section dealing with
arguments against income management, there has been strong
criticism of the Government’s use of evidence in support of
income management—in particular, questions have been raised
about the quality of the data in the reports and the
Government’s selection and interpretation of that data.
However, it is important to note that, such problems aside,
there are immense difficulties associated with evaluating the
effectiveness of a policy intervention as complex as the NTER and
its various components, including income management. For one thing,
it is virtually impossible to isolate the various elements of the
NTER (such as income management, alcohol prohibitions and increased
policing) in a way that would make it possible to draw reasonable
conclusions about the relationship between particular policy inputs
and particular outcomes (such as improved health and education
outcomes and reductions in crime). This means that evidence
provided for or against the NTER or any of its individual inputs
will, at best, only ever partially clarify particular aspects of a
complex situation.[68]
There are probably two important points to take from this.
First, it suggests that evidence used either in support of or
against the intervention and income management should be treated
with particular caution. Second, it raises questions about the
relationship between evidence and policy-making. What types of
evidence should be used by policy-makers? Should the absence of
evidence constrain policy-makers from adopting particular
policies?
Arguments against income management may be broadly categorised
as falling into two (frequently overlapping) areas. First, there
are those arguments that criticise income management on empirical
grounds. These arguments have it that there is an insufficient
evidence base to support income management as being beneficial
either to affected welfare recipients, or to the community as a
whole. Second, income management has been criticised on moral
grounds. Some commentators maintain that income management is wrong
in principle and should not be instituted under any circumstances.
Others, whilst they are broadly opposed to the idea of income
management, nevertheless support its use under limited and specific
circumstances.
Some argue that there is no (or limited or flawed) evidence to
suggest that compulsory income management results in improved
health or school attendance among children.[69] Other commentators have taken issue
with the Government’s evaluation of welfare quarantining in
the NT, arguing that it has misused data which is itself
methodologically flawed.
For example, social policy academic, Eva Cox, argues that
Minister Macklin has over-promoted the results of an Australian
Institute of Health and Welfare (AIHW) report into welfare
quarantining. Rather than elaborate on the significant doubts
raised by the AIHW in relation to the limited data, Cox argues that
Macklin has declared—largely on the strength of anecdotal
evidence obtained from only 76 people in only four out of 73
communities—that income management has significantly improved
living conditions for children and families in Indigenous
communities.[70]
Cox has also expressed the concern that consultations with
Indigenous people in the NT about future directions for the
intervention—including income management—were not
genuinely consultative.[71] Further, Cox has questioned Minister Macklin’s
claims of Indigenous support for income management on the strength
of feedback given through the consultation process. In doing so,
she draws on the observations of the independent Cultural and
Indigenous Research Centre Australia (CIRCA), which was charged
with monitoring the openness and integrity of the consultations. In
its report on the consultation process, CIRCA suggests that the
Government’s summary of discussion and responses to income
management did not accurately reflect the level of Indigenous
opposition to this measure.[72]
Due to the relative novelty of the policy, very few trials have
been conducted of income management arrangements. Indeed, the only
substantive evaluation of a scheme that links welfare payments to
school attendance in Indigenous communities in Australia, for which
the results are publicly available, is of a voluntary trial
conducted in Halls Creek in 2006.[73] This evaluation found that the school attendance
of children did not improve during the course of the trial. The
research suggested that there was a range of reasons for
children’s non-attendance. While lack of parental engagement
or support for education was one factor that contributed to low
attendance, the evaluation found that it was not sufficient to
focus on forcing parents to make their children go to school. The
key to improved attendance, it was determined, lay in creating an
education environment that students wanted to be a part of.[74]
In line with the above findings, some commentators have argued
that there is scant evidence linking income management to improved
school attendance and educational outcomes in relation to the NT
intervention.[75]
Moreover, Irene Fisher, the Chief Executive Officer of the Sunrise
Health Service Aboriginal Corporation, maintains that income
management has not reduced alcohol or drug consumption or stopped
humbugging.[76]
In the case of alcohol consumption, Fisher contends that the
problem has simply been moved from prescribed communities into
towns. Studies of communities east of Katherine and Alice Springs
town camps, conducted in 2008, found that there was increased
violence in Alice Springs and Katherine pubs, as well as increased
drink driving.[77]
Indeed, it is argued by Fisher, Behrendt and others that the
blanket imposition of compulsory income management in the NT has
had negative effects that have gone unrecognised or
unacknowledged by the Government. For example, contrary to
government statements, Irene Fisher argues that income management
has not resulted in an increase in the consumption of fresh
food.[78] This
argument is supported by evidence of increasing rates of
anaemia in children under the age of five since the commencement of
the NT intervention. According to Behrendt, based on data collected
by Irene Fisher and Sunrise Health Services, the early childhood
anaemia rate in the Sunrise Health Services region has risen from a
low of 20 per cent in the six months to December 2006 to 55 per
cent by June 2008.[79]
Behrendt also highlights evidence of an increase in low birth
weight among babies in the Sunrise Health Services region.
According to Sunrise Health Services health check data, low birth
weight rates have risen from nine per cent in the six months prior
to the intervention to 19 per cent by December 2008.[80] Thus, the region has
gone from doing better than the national average for Indigenous
babies (14.3 per cent) to doing far worse. While Behrendt concedes
that there is no conclusive proof that the rise in anaemia rates
may be causally linked to the intervention and its effects, she
nevertheless argues that ‘it is clear that the Intervention
has failed to address a severe health problem that appears to be
further deteriorating. It also shows the critical need to
investigate claims of improved diet as a result of welfare
quarantining’.[81]
The Australian Indigenous Doctors Association (AIDA) has
conducted, in collaboration with the Centre for Health Equity
Training, Research and Evaluation, a Health Impact Assessment of
the intervention. The Assessment found that the income management
arrangements had resulted in humiliation, embarrassment and
confusion among participants, as well as increased
discrimination.[82]
AIDA argued that these effects have, in turn, impacted on affected
people’s mental health, social and emotional
well-being.[83]
It is important to note that FAHCSIA monitoring reports
measuring progress of intervention activities have themselves
revealed a number of negative findings.[84] While it is not possible to draw a
causal link between these findings and the income management
component of the NT intervention, for reasons discussed above, the
findings are still of some concern. Those findings that
may be more or less related to the income management
measure include an increase in the number of alcohol-related and
domestic violence-related incidents reported to police and an
increase in the number of substance abuse incidents. However, as
noted above, there is no way of definitively determining whether or
not this is the case. It should also be borne in mind that these
findings may be the result of increased reporting, rather than an
increase in actual incidents.
The Rudd Government’s representation of income management
as a tool for the promotion of responsibility and for the
development of positive social norms locates it squarely within the
framework of mutual obligation.[85] According to the logic of mutual obligation,
income support recipients are required to demonstrate that they are
deserving of their allowance. Thus, not only must affected
individuals meet their activity test requirements under the Social
Security Act (that is, show that they are looking for work and
participating in employment training or other approved activities),
as was previously the case, but they must also, if they wish to
avoid being subject to income management, show that they are using
their allowances in a responsible fashion.
As some commentators see it, such demands amount to a breach of
income support recipients’ inalienable right to welfare
support. For example, the political commentator, Guy Rundle, is
philosophically opposed to the very notion of income management,
along with the idea that it should be employed as a mutual
obligation policy lever. In an assessment of the Cape York income
management scheme, Rundle takes issue with the idea that it is
possible to restore or inculcate a sense of responsibility in
welfare recipients by quarantining their payments. This, he
maintains, is to simply enforce in recipients a higher level of
passivity and control.[86]
Chief Executive Officer of the St Vincent de Paul Society, John
Falzon, is similarly critical of the use of social security
payments as a means to punish people or change their behaviour.
Falzon argues against the idea that ‘people doing it tough
can have a better life as a result of being treated in a
paternalistic way’, through measures such as income
management.[87] On
the contrary, he argues that income management disempowers and
denigrates and does not address any of the problems that people
might have in their lives. Rather than ‘indulging in such a
coercive and controlling approach’, Falzon maintains that the
Government should ‘honestly look at the supports that people
need, starting with a review of inadequate payments’.[88] On this view, then,
income management can do significant damage, and cause more
problems than it solves.
It should be noted that few commentators appear to take issue
with the application of income management in certain, specific
instances. In cases where parents are obviously not spending
welfare payments on the basic needs of life and their children are
suffering as a consequence, there would appear to be a general
agreement that some form of intervention is necessary. (This is not
only in the interests of children themselves but also their parents
who are in danger of becoming further disadvantaged and
dysfunctional. Crudely put, some people may need to be saved from
themselves and/or their addictions using what has been described as
‘tough love’.) Likewise, many critics of the
Government’s reforms are not averse to the basic principle of
mutual obligation.[89]
However, many commentators argue that where income management is
applied on a relatively indiscriminate basis, this is
punitive and unfair. Many income support recipients are quite
capable of managing their (limited) finances without outside help
and intervention—and despite falling into the
Government’s ‘at risk’ categories. As John Falzon
argues, ‘to suggest that exemptions will be available for
some welfare recipients if they can demonstrate responsible
behaviour is an indication that the Government is beginning with
the assumption that welfare recipients are guilty until proven
innocent’.[90]
Some argue that this may have the unintended consequence of
undermining individual responsibility for managing finances and
decision making by placing it in the hands of
administrators.[91]
Further, it could be argued that a ‘blanket’ approach
to deciding who will be subject to income management is
inconsistent with the Government’s social inclusion agenda,
which is ostensibly about targeting welfare support and services to
meet the complex needs of individuals. Minister Macklin has stated
‘the delivery of payments and … services must take
into account the different circumstances of the people
they’re trying to help. They shouldn’t just fit the
institutional frameworks from which they’ve
developed’.[92]
In relation to the above point, it is important to note a
crucial distinction between the income management arrangements
operating under the NT intervention and those instituted in Cape
York Peninsula. While income management has been imposed
indiscriminately on welfare recipients within declared NT areas
(that is, on a geographical basis), in Cape York income management
is only applied to those income support recipients who fail to meet
certain obligations to their children and the community.[93] Where a person does
not meet one or more of their obligations, the Family
Responsibilities Commission may recommend that the sanction of
income management be imposed on them. If the person is able to
demonstrate that they have been complying with their obligations,
then their right to manage their own payments may be
reinstated.
According to lawyer, Jo Sutton, the Cape York approach to income
management offers substantive advantages over the regime introduced
as a part of the NT intervention.[94] The first of these is that the targeted approach
adopted in Cape York does not characterise all income support
recipients as being irresponsible and incapable of meeting their
parental and/or community obligations. As intimated above, this is
an important consideration, given evidence of the negative effects
of such characterisations. Similarly, the more targeted approach in
Cape York can be seen as affording a greater level of procedural
fairness.
The second benefit of the Cape York approach is that it makes
maximum use of income management as a mutual obligation policy
lever. Income support recipients are encouraged to exercise
responsibility (under threat of the sanction of income management)
and to thereby demonstrate their right to manage their own
finances. As Noel Pearson has it, ‘individuals in Cape York
communities … face clear incentives to retain control of
their income by fulfilling their basic responsibilities to children
and the community. At any time they can regain discretion over
their income by acting responsibly’.[95]
Finally, some have argued that a further benefit of the Cape
York approach is that it emerged from the Cape York communities
themselves. In other words, it was a local initiative, rather than
one largely imposed by outsiders.[96] The program was introduced by the Bligh
Government in Queensland after consultation with the Commonwealth
and Noel Pearson’s Cape York Institute. Local elders who make
up the Family Responsibilities Commission in each community also
have a hand in the income management process and are reported to
have assisted local people in avoiding the sanction of welfare
quarantining.[97]
Thus, the procedural rights of those income support recipients who
are affected are retained.
The independent report of the Northern Territory Emergency
Response Review Board recommended in September 2008 that that the
blanket application of compulsory income management in the NT
should cease. In its place, the Board recommended that income
management be made available on a voluntary basis or, in instances
where it was clearly necessary, by compulsion.[98]
A more targeted approach to income management than that outlined
in the Rudd Government’s proposed reforms would undoubtedly
be more complex in terms of its administrative requirements, and
could prove more expensive as a result. Nevertheless, given
evidence about the benefits of such an approach outlined above,
proponents of a targeted approach would argue that any additional
expense would be money well-spent.
Income management is costly. The Government has estimated that
the reforms will cost $350 million over four years in the NT
alone.[99] It is
argued by some that these monies would be better spent on targeted
and relevant programs that have been proven to help tackle the
underlying causes of disadvantage. This, it is argued, would be to
provide people with the opportunities and resources necessary to
survive and to succeed, which, had they been provided in the first
place, would have ensured that many of the people in receipt of
income support would not have required this support.[100] As some see it, the
provision of such opportunities and resources would simply amount
to the Government’s meeting its own neglected side of the
unequal bargain when it comes to the mutual obligations
compact.
The Government has made much of the non-discriminatory nature of
the income management reforms. By extending the income management
provisions beyond indigenous communities, such that it is possible
to reinstate the operation of the RDA, the Government argues that
the new reforms are non-discriminatory. This assumption has been
questioned by some commentators, who argue that compulsory income
management is discriminatory on the grounds of socioeconomic
status.[101] For
example, Greens Senator, Rachel Siewert has argued that
‘through this change in policy, the government is not so much
moving away from discriminating against Aboriginal people as
expanding its discrimination to include a wider group of low-income
and disadvantaged Australians’.[102]
The April 2007 Little Children are Sacred report which
triggered the NTER found that alcohol abuse was destroying
communities and was the gravest and fastest growing threat to the
safety of children.[103] Under the NTER, alcohol restrictions were introduced
which banned drinking, possessing, supplying or transporting liquor
in prescribed areas. However, the NTER also allowed for the
continued operation of licensed premises and individual permits
issued under the Liquor Act 1978 (NT) for some
recreational, tourism and commercial fishing activities, and
monitored takeaway sales across the whole of the NT.
In its policy statement, the Government argued that
consultations revealed a strong consensus that the alcohol
restrictions should continue, though recognising that some people
expressed concerns that alcohol-related problems had continued or
even increased since the NTER started, with particular concern
about changes in drinking patterns, including extensive use of
‘drinking paddocks’ outside prescribed area boundaries,
and increased visits to regional towns to drink.[104] A further point raised at the
consultations was that blanket alcohol restrictions do not
encourage responsible drinking behaviours and have cut across
previous locally-based alcohol controls. The Government has
suggested that the reason the number of alcohol-related incidents
reported to police across the NTER communities rose from 2271 in
2006–07 to 3047 in 2007–08 may be increased policing
and police presence, and the widening of the scope of
offences.[105]
The Government proposes to continue alcohol restrictions, but to
shift from a universally imposed measure to ‘alcohol
management plans’ designed to meet the individual needs of
specific communities. This is on the grounds that community
solutions to restrict alcohol can be more effective than blanket
restrictions. The new approach is to be based on an analysis of
evidence about each community’s circumstances and
consultation with the community. Where a proposed alcohol
management plan for a community or region requires the variation of
some of the existing NTER alcohol restrictions in the legislation
for that area, the Government has undertaken to consider evidence
about the level of alcohol-related harm in that area before
approving changes, and, in the event of changes, to closely monitor
trends in alcohol-related harm in communities. If necessary, the
Minister will have the capacity to reimpose existing alcohol
restrictions.
The Bill will remove the provisions that applied to all
prescribed areas that part of the Police Administration Act
1978 (NT) (Division 4 of Part VII) which allowed areas to be
treated as if they were public areas. It will replace those
provisions with ones which oblige the Commonwealth Minister to
specify by legislative instrument the prescribed area or part of
prescribed area to which Division 4 of Part VII of the Police
Administration Act 1978 is to apply. The new provisions will
also oblige the Minister to only make a declaration after a request
from a resident of the area and after a process of community
consultation (item 10; proposed section 18 of the NTNER
Act).
The Bill will also remove the requirements for a licensee to
record the sale of take-away liquor over $100 or more than 5 litres
of wine, as that requirement was considered ineffective
(item 13; repeal of Division 3A of Part 2 of the NTNER
Act).
In the Explanatory Memorandum and second reading speech, the
Government argued that this measure is a special measure for the
purposes of the RDA because the revised measures will:
- reduce the risk of alcohol-related harm involving women and
children
- help improve health outcomes for Indigenous people in the
relevant communities
- take into account the differing needs of communities, and
- allow for communities to have say in the form of alcohol
restrictions.
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The April 2007 the Little Children are Sacred report
found that the exposure of children and the community to sexually
explicit and very violent films, publications and computer games
might be posing a health risk and recommended the investigation of
strategies to restrict access to such material. The subsequent NTER
included prohibitions on the possession and supply within
prescribed areas of sexually explicit or very violent material
distributed as publications, films or computer games.
In its earlier discussion paper on the NTER, the Government
proposed that the NTER restrictions on prohibited material be
lifted but that communities could apply to have restrictions
retained.[106]
However, the Government changed this position following the NTER
consultations. According to the Government, there was a strong view
from the consultations that sexually explicit and very violent
material is not wanted in communities and that children need to be
protected from it. Nevertheless, there was also a view that road
signs notifying the restrictions on prohibited material are
offensive and cause people to feel stigmatised.[107]
In the end the Government decided that the current restrictions
would remain in place, but the Bill provides that communities could
make an application to have the restrictions lifted in their
communities (new section 100A). The Minister, in
considering such an application, needs to consider evidence about
the prevalence of sexually explicit and very violent material in
the community; the well-being of people in the community; the views
of people in the community; and the advice of the relevant law
enforcement authority (new subsections 100A(6) and
100B(6)).
A declaration to remove the restrictions on prohibited material
under the NTER legislation would mean that these areas would be
subject to the same restrictions on sexually explicit and violent
material as apply in other parts of the NT.
In the Explanatory Memorandum and second reading speech, the
Government expressed the belief that this measure is a special
measure for the purposes of the RDA because:
- it will reduce the risk of children being exposed to
pornographic material, the risk of child abuse and the problem of
sexualised behaviour
- consultations revealed that members of the communities
recognised these benefits and supported the measure
- the restrictions will be continued for the sole purpose of
protecting children in the communities, and
- communities will (if they wish) be able to move to have the
pornography restrictions lifted in their community.
Five-year leases were purportedly introduced as part of the NTER
to provide the Government with tenure over lands and to allow
access to facilitate the administration of the NTER. The underlying
title of the land is unaffected by the leases, it still being owned
by the traditional owners. In response to the NTER Review
Board’s recommendation that rent be paid to the Aboriginal
owners of five-year leased land, the Government requested that the
NT Valuer-General make a determination as to the amount of rent to
be paid and rent payments have commenced for some
communities.[108]
The five-year leases have been used to underpin the Community
Clean Up Program, Government Business Manager accommodation,
installation of safe houses, and reformed property and tenancy
management arrangements. The Government currently holds five-year
leases over 64 communities.[109]
According to the Government, the NTER consultations revealed
some misunderstanding about the five-year lease (for example, that
the underlying title of the land is not affected by the leases, the
Indigenous owners still own the land), some concern about rental
payments for these leases, and some frustration at delays in
delivery of housing renovations and long-term housing.[110] However, the
Government has also suggested that the consultations also revealed
that many people in communities understood the benefits of
five-year leases (upgrades and renovations to houses, improvements
to community infrastructure, and associated creation of employment
opportunities for local people).[111]
The Bill retains the five-year leases until they expire in
August 2012, but introduces some changes to help clarify their
purpose and operation, including:
- making it clearer that the objectives of the five-year leases
are to enable special measures to be taken to improve the delivery
of services in Indigenous communities in the NT and promote
economic and social development in those communities
(new section 30A)
- defining the permitted use of leases as being directly related
to achieving those objectives (new subsection
35(2A)
- clarifying that exploration and mining are not permitted uses
of the five-year leases (new subsection
35(2B)
- requiring the five-year leases to be administered with regard
to Indigenous culture (as it applies to the land covered by the
lease) (new section 36A)
- facilitating the Government’s commitment to move to
voluntary leases by requiring the Government to negotiate the terms
and conditions of the new leases in good faith where requested
(new section 37A), and
- developing clear guidelines to better explain the land use
approval process to ensure the transparent allocation of lots
(new section 35A).[112]
In the Explanatory Memorandum and second reading
speech, the Government expressed the belief that this measure is a
special measure for the purposes of the RDA because:
- the leases enable the provision of services and other benefits
to the communities
- the consultations revealed some recognition of these benefits,
and
- the proposed legislative changes will limit the effect of the
lease measure on existing rights.
The leases only operate until 2012, and in this period the
Government plans to work towards transitioning to voluntary leasing
arrangements.
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The licensing of community stores was introduced under the NTER
to improve the range and quality of food and groceries available in
communities; to allow stores to take part in the income management
arrangements; and to encourage them to better meet the nutritional
and household needs for communities. Under the NTER, community
stores are assessed for licence qualification on the basis that
they:
- have a reasonable quality, quantity and range of groceries and
consumer items available and promoted at the store, including
healthy food and drinks
- demonstrate the capacity to participate in the requirements of
the income management arrangements under social security law,
and
- have sound financial structures, retail and governance
practices.
According to the Government, the NTER consultations revealed
that the range and quality of food and household items available
from local stores had improved under the NTER, and that most felt
that community store licensing should continue and be strengthened
as the Government proposed. These proposals were:
- to establish a legislative link between community store
licensing and the eligibility of a store to participate in the
income management arrangements under the social security law
- to extend the scope of the licensing scheme to cover shops
which are a key source of food, drink and grocery items for an
Indigenous community, including takeaway or fast food shops and
roadhouses, and
- to provide greater clarity and transparency in the focus of the
licensing assessment process and the obligations of licence
holders.
In its earlier discussion paper on the NTER, the Government
proposed that the new licensing arrangements would include a power
to require a store owner to appoint a new licensed store operator
if the store was not being operated satisfactorily. In the
arrangements provided for by the Bill, licences will be issued to
owners (new subsection 96(1) (rather
than operators) to recognise their specific responsibility. The
licence will also refer to conditions and obligations that are
imposed on managers where the manager is not also the owner of the
store (new section 93C). This change is thought to
remove the need to provide for the transfer of licences between
managers, and reduce the administrative burden when a store changes
manager.
The Bill also provides for decisions made under the community
store licensing scheme to be reviewed by the Administrative Appeals
Tribunal (new section 127A), and removes the
current provisions that permit the Australian Government to
compulsorily acquire a community store’s assets and
liabilities (item 49).
In the Explanatory Memorandum and second reading speech, the
Government expressed the belief that this measure is a special
measure for the purposes of the RDA because:
- it assists in improving the health of people in remote
Indigenous communities
- consultations reveal that most people in the communities
recognise the measure’s benefit and want it to continue
- the licensing arrangements will be continued for the sole
purpose of improving food security and the health of people in
those communities, and
- there will be consultation with the communities in relation to
the operation of key elements of the scheme.
The Little Children are Sacred report found that people
were reluctant to report concerns that a child may be experiencing
violence, fearing violence against themselves if they did so. Under
the NTER, the Australian Crime Commission Act 2002 was
amended to insert provisions to enable the Australian Crime
Commission (ACC) Board to authorise a special intelligence
operation/investigation into ‘Indigenous violence or child
abuse’, which was defined as ‘serious violence or child
abuse committed by or against, or involving an Indigenous
person’. The Government stated that most people who commented
during consultations indicated support for the powers to be
continued and monitored for effectiveness.[113]
The Government proposes to retain the ACC’s special law
enforcement powers but to make it clear that these powers are only
in relation to serious violence or child abuse committed against an
Indigenous person (item 1).
In its Explanatory Memorandum and second reading speech, the
Government expressed the belief that this measure is a special
measure for the purposes of the RDA because:
- the measure protects the rights of Indigenous people,
especially children and women, by facilitating the reporting and
investigation of crimes involving serious violence and abuse, the
prosecution of such offences, and therefore the prevention of
further serious violence and abuse
- the measure will be continued for the sole purpose of
protecting Indigenous people, and
- the Bill will restrict the use of powers to instances in which
serious violence or child abuse is committed against an Indigenous
person.
The Bill (along with the Families, Housing, Community
Services and Indigenous Affairs and Other Legislation Amendment
(2009 Measures) Bill 2009 and the Families, Housing,
Community Services and Indigenous Affairs and Other Legislation
Amendment (Restoration of Racial Discrimination Act) Bill
2009) has been referred to the Community Affairs Legislation
Committee for inquiry and report by 9 March 2010. Details of the
inquiry are at http://www.aph.gov.au/Senate/committee/clac_ctte/soc_sec_welfare_reform_racial_discrim_09/index.htm
The response by interest groups and press commentators to the
provisions in this Bill has been mixed. The main area of
controversy has been the Government’s intention to introduce
a national income management scheme.
The repeal of NTER laws requiring the suspension of the
operation of the RDA has been generally welcomed. For example,
Australian Human Rights Commission Aboriginal and Torres Strait
Islander Social Justice Commissioner, Tom Calma, has said that this
would send an important message that the Government was genuine in
its commitment to resetting the relationship with Indigenous
Australia.[114]
This change has also been publicly supported by the Law Council
of Australia (LCA) and a range of community sector organisations
such as the Australian Council of Social Service (ACOSS).[115]
Nevertheless, whilst welcoming the reinstatement of the
operation of the RDA, some have argued that the NTER and income
management provisions in the Bill will continue to have a
discriminatory impact on those affected. For example, a joint
statement on income management from ACOSS and 11 other community
sector organisations has argued that:
… the extension of income
management will indirectly discriminate against Indigenous
Australians in disadvantaged areas across the country, who are
likely to be disproportionately affected by the policy … The
proposed changes will also discriminate against income support
recipients across the country on the basis of income source,
duration of income support and geography. Income managed
individuals will have to use a card to purchase groceries and other
essentials. This card reveals an individual’s income source
to retailers and others and is likely to cause shame and
discrimination, as it has to affected recipients in the Northern
Territory.[116]
Not all observers have welcomed the Government’s objective
of reinstating the operation of the RDA. For example, former Howard
Government adviser, David Moore, has argued that this objective is
‘ideological’ and ‘puts at risk’ the
effectiveness of the NTER (given the changes to the various NTER
measures necessary to ensure compliance with the RDA).[117]
The Rudd Government’s decision to continue and extend
income management has attracted a range of responses.
Some have welcomed the decision on the grounds that it has, in
their view, benefited people in the NT and other areas in which it
has been introduced. For example, child welfare officer, Mildred
Inkamala, from the NT community of Hermannsburg, has argued for an
expansion of income management because it has resulted in
‘kids … going to school, they’re healthier,
people are not spending all their money on grog’.[118] Similarly, while
Mission Australia chief executive, Toby Hall, has argued for a more
sustainable approach ‘that addresses the issues that lie at
the heart of a parent’s behaviour’, he has also argued
that ‘positive results … have been achieved as a
result of income management in the NT and in other parts of the
country’.[119]
Independent Member for the NT seat of Macdonnell, Alison
Anderson MLA, has been reported as supporting compulsory income
management—‘provided, she says, that it is extended to
all welfare recipients regardless of race’.[120]
Most critics of the Rudd Government scheme have not been against
income management as such but (as was largely the case with the
Howard scheme) rather have taken issue with the particular form in
which income the scheme is to be implemented. For example, the
Joint statement on income management by 12 community
organisations called on the Government to withdraw the
compulsory income management provisions of the Bill on the
grounds that:
We support non discriminatory policies to help
people manage their finances where this is necessary. However, any
such policies must respect the rights and dignity of all income
support recipients.
Our experience over many decades across
Australian communities is that working with people to build the
skills and expertise necessary to manage their finances and
relationships well is the key to long term transformation in the
lives of those most disadvantaged. Quick fixes don’t work.
There is no evidence to suggest that micro managing people’s
incomes empowers them or helps them to develop the necessary
skills.[121]
The main concerns raised in the statement in relation to
compulsory income management are that:
- the policy denies that the ‘vast majority of income
support recipients budget effectively with the inadequate payments
they receive’
- the absence of a sufficient consultation process with
Indigenous communities in the NT in relation to compulsory income
management under the NTER or broader consultation in relation to
the Government’s plans to extend income management
nationally
- the lack of an evidence base for the policy, and
- resources committed to introducing compulsory income management
‘would be better spent on improving the adequacy of income
support payments and effective services for struggling individuals
and families’.[122]
As a result of these concerns, the joint statement argues that
the compulsory income management provisions in the Bill should be
replaced with voluntary system. That is, a system that
‘people can opt into, on an individual or local community
basis’.[123]
Australians for Native Title and Reconciliation (ANTaR) has
criticised the proposed confirmation of the compulsory five-year
leases as ‘special measures’ and legislating for
transition to longer-term so-called ‘voluntary’ leases
as being ‘directly against the wishes of Aboriginal
communities’.[124] ANTaR National President, Dr Janet Hunt, has argued
that ‘it could have the effect of denying Aboriginal people
the right to control the development of their communities for
generations to come’.[125] She has also argued that:
The continued government take-over of
Aboriginal communities remains in breach of their right to
self-determination and goes against established evidence that
providing greater, not lesser control, to Aboriginal peoples
results in better outcomes in terms of ‘closing the
gap’ objectives.[126]
ANTaR has also criticised what it describes as ‘the
continuation of the stigmatising approach to prohibited
material’ in the Bill.[127]
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Based on comments made by Tony Abbott MP, both in his capacity
as Shadow Minister for Indigenous Affairs and Families and as
Leader of the Opposition, the Coalition would appear to be
supportive of the Government’s plan to expand the income
management scheme to vulnerable regions and individuals at
risk.[128]
Abbott’s position on welfare quarantining is perhaps most
clearly elaborated in his recently published book. As Abbott sees
it, welfare-dependent families with children under the age of 16
should generally be subject to income management. In response to
the argument that this would inevitably include in the scheme
families who are perfectly responsible in their spending, Abbott
asserts that ‘these families would already spend well over 50
per cent of their welfare income on the necessities of life, so
they should not be affected or inconvenienced by such a
change’.[129]
While Abbott has not specifically commented on the extension of
income management to those categories other than families who are
deemed by the Government to be at risk, it may be inferred from his
comments that he is, on the whole, supportive of general welfare
quarantining. Such arrangements would, he argues, ‘send the
clearest possible message that people on welfare have obligations
as well as entitlements’.[130]
As noted above, Senator Rachel Siewert has been scathing in her
assessment of the Rudd Government’s proposal to expand
existing compulsory income management arrangements.[131] Siewert is critical
of the proposal on both empirical and moral grounds, arguing that
‘there is no evidence to support the claims that this
approach actually works—let alone that this morally dubious,
expensive and administration-intensive approach can deliver
outcomes that justify its complexity and cost’.[132] As Siewert sees it,
the policy proposal is paternalistic and discriminatory towards
low-income and disadvantaged Australians and, as such, offers
little in the way of encouraging or empowering these people. In
Siewert’s view, ‘rather than attempting to punish
struggling, low-income families, the government should be dealing
with the underlying causes of neglect and delivering proper support
for families in crisis’.[133]
The financial costs to the Government arising from the Bill are
a result of additional resourcing from the changes to income
management. As can be seen from the table below, the Government
expects the total cost of the change between 2009–10 and
2013–14 to be $401.7 million. This includes the cost of
operating both the income management scheme itself and financial
management support services associated with the scheme.[134]
|
2009-10
|
2010-11
|
2011-12
|
2012-13
|
2013-14
|
Total
|
|
$5.9 m
|
$105.6 m
|
$99.6 m
|
$94.7 m
|
$95.9 m
|
$401.7 m
|
Source: Explanatory Memorandum
The financial impact of the remainder of the Bill is nil.
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Division 2 of Part 1 of Schedule 2 to the Bill
allows for a 12 months transition period—those subject to
income management prior to 1 July 2010 will remain on income
management until either transitioned to new scheme or moved off the
scheme altogether. The transition period is 12 months from 1 July
2010, and item 23 continues the operation of the
income management regime to persons being managed under the
to-be-repealed section 123UB of the Social Security
(Administration) Act 1999. Section 123UB will be repealed by
item 12.
New section 123TFA of the Social Security
Administration Act 1999 will allow the Minister to declare by
legislative instrument that a state, a territory or a specified
area is a ‘declared income management’ area.[135] The legislative
instrument is a disallowable instrument.
Item 36 inserts new sections 123UCA,
123UCB and 123UCC to apply IM to vulnerable welfare
payment recipients, disengaged youth and long-term welfare payment
recipients.
Items 47 and 49 amend the Social Security Act
so that voluntary income management agreements may be terminated,
but the agreement must be in force for at least 12 weeks.
Other major main provisions are mentioned in the relevant areas
throughout this Digest.
Concluding comments
The Bill provides for the repeal of provisions in the NTNER Act
that limited the operation of the RDA. It also provides for
re-designed NTER measures that would assist in meeting the
Government’s commitments to improving the lot of Indigenous
Australians while not breaching the reinstated RDA. It remains to
be seen whether or not those measures that have been retained as
special measures and as beneficial to Indigenous people in the NT
will prove to be so. Apart from the income management measure, the
revised NTER measures have not been the subject of widespread
public criticism.
The proposed income management measure has attracted a
significant amount of public comment, much of which has been
negative. It is perhaps unsurprising that the proposed income
support changes should have proven to be controversial. For one
thing, they represent a further shift away from the long-standing
principle of welfare payment inalienability. For another, the
measure necessarily involves the extension of compulsory income
management arrangements beyond a largely Indigenous population to
specified groups within the mainstream, non-Indigenous
community.
That said, while the Government claims that the introduction of
income management to the whole of the NT represents the precursor
to a national roll-out of the scheme, it is by no means clear,
based on available information, to what extent this will in fact be
the case.
The Government is obliged to extend the income management scheme
beyond largely Indigenous communities in the NT in order to retain
the measure as a part of the NTER whilst not breaching the RDA. In
doing so, while at the same time targeting groups of income support
recipients deemed to be at risk, the Government may argue that it
is ensuring that the measure is non-discriminatory and focused on
areas of need. However, although the proposed new arrangements are
more targeted than those introduced as a part of the NTER,
they may still be regarded as arbitrary in that the new scheme
includes entire categories of income support recipients, with the
burden of proof placed on these recipients to demonstrate that they
are socially responsible if they are to be excluded from income
management.
A majority of commentators appear to see a role for some form of
income management in particular circumstances. However, many
commentators regard the relatively indiscriminate application of
income management arrangements as detracting from, rather than
supporting, income support recipients’ ability to exercise
responsibility. Most appear to agree that income management is
appropriate under circumstances where it is clearly targeted at
those in need, based on proper consultation with those people
affected and accompanied by services that support struggling
individuals and communities.
The proposed reforms to the NTER (most particularly, those
relating to income management), have also been criticised on the
grounds that the evidence presented by the Government in support of
them has been questionable. To a degree, this has to do with the
nature of the NTER itself, and the inherent difficulty in drawing
causal relationships between particular measures and particular
outcomes. All the same, a number of commentators have argued that
the Government’s evidence is in many instances flawed and
misrepresented. Further, some maintain that in certain areas the
evidence demonstrates that compulsory income management has had
negative consequences for individuals and
communities—consequences that the Government has failed to
acknowledge.
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Luke Buckmaster, John Gardiner-Garden
Matthew Thomas and Diane Spooner
9 February 2010
Bills Digest Service
Parliamentary Library
Members, Senators and Parliamentary staff can obtain further
information from the Parliamentary Library on (02) 6277 2500.
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