Transcript 3AW Melbourne With Tom Elliott

Release Date: 
15 October 2014

TOM ELLIOTT: Andrew Forrest, good afternoon.


TOM ELLIOTT: Now what have you done? You've done a report for the Government, you've got some radical ideas I believe. What are they? Tell us about them.

ANDREW FORREST: Look I don't think they're radical.  Let's just kick off with that.  New ideas become the accepted dogma because they make good and rational sense. They are ideas which are out to help every vulnerable Australian and in particular Indigenous Australians.

We don't have a huge population of Indigenous Australians here in Victoria but as Victorians are passionately Australian, no Victorian should want to live in a country where we have such a disparity, where if you're an Indigenous woman you're about 30 times more likely to be hospitalised for assault just because you're an Indigenous woman.  In the Northern Territory that rises to 80 times more likely to be hospitalised for assault.

There are things every Victorian can do to make sure this disparity stops.

TOM ELLIOTT: Well the Government- and we're going to hear from the Government shortly, the Parliamentary Secretary to the Prime Minister, Alan Tudge is also with us.  But Ok, governments have the ability to tax people and to spend the money or to give it to
others. What do you think we should do differently in our welfare system to overcome
some of the disadvantages that you mentioned?

ANDREW FORREST: I think we should stop the spending freight train.  There's huge amounts of money with very little outcomes attached to it.

What I would like to see done is measurability and accountability so those billions of dollars- and you're totally correct- the Commonwealth spent $13 billion on propping up the  disparity last year. New South Wales alone spent $6 billion.  There's just tens of billions of dollars being wasted here for a condition of the Australian people which is man-made, therefore can be man-solved.

TOM ELLIOTT: Alright what is that condition? Is it simply inequality?

ANDREW FORREST: No, it's a fact that basically- let's start at the start. We have a basic soft bigotry of low expectations towards our Indigenous brothers and sisters. We kind of say 'hey look you know you're not going to do so well so we're going to look after you and we've got to give you more money and we've got to give you these handouts and we're going to expect you not to succeed.' Now if you heard that constantly from your mum or dad or from anyone you'd probably begin to believe you wouldn't succeed.

We've been doing that to people who are every bit our equal for decades and if we just accept an Indigenous person with a decent education does as well in the workforce as any other Australian. If we even go as far to say that an Indigenous woman with a degree actually participates at a higher rate of employment than her other Australian sisters then we know for sure we're dealing with a system which is broken but can be fixed.

TOM ELLIOTT: Now one of the things I've seen that has been rolled out in many Indigenous communities is the idea instead of paying cash as a form of welfare you say to people well look, you may not spend the cash on the right things so we're going to give you a card that allows you to buy food, non-alcoholic drink, pay the rent, that sort of thing.  Is that a type of welfare that you'd like to see rolled out to the rest of Australia?

ANDREW FORREST: Look it's very specific in the report.  I've advocated this for vulnerable Australians.  I'm an individual, a passionate Australian who says welfare is very necessary to help people transition between jobs, to prop them up in bad times, but what it's not for, it's not to just tick a box. Some welfare activist says hey we should just throw more money and more money at these people who are struggling in the first place to make good short-term decisions. Let's not give up on those vulnerable Australians which is what the box tickers  do, they say 'here's a cheque, I feel better about myself, I've given you a cheque of someone else's money, I'm feeling great.'  Well I call that giving up on your fellow Australian.

I'm saying, OK here's a cheque, now let's work out quickly what's put you into this very vulnerable situation. In 99 out of 100 times you can find it related to in some way gambling, drugs, alcohol despondency, and inequality.  That's where that vulnerability comes
from. Let's start with the big three, let's start with gambling, drugs and alcohol.

Now vulnerable Australians who really are torn down by those three aspects where they get a welfare cheque and the first person on their door is a drug dealer and the first choice is 'I'm feeling crap, I had these drugs last night, I did this, I did that, I'm full of shame now so

I'm going to go down the pub.'  That's their second choice.  Then there's entertainment gambling.

So these are three things that prevent people from doing what the Prime Minister asked me to achieve and that's remove the hurdles which stop people getting employment and I can assure every Australian, drugs and alcohol will stop people getting employment.

TOM ELLIOTT: Well I don't think anyone would disagree with that. Also here in the studio is Alan Tudge, he's the Parliamentary Secretary to the Prime Minister, Tony Abbott. Mr Tudge good afternoon.

ALAN TUDGE: Good afternoon John.


ALAN TUDGE: Sorry Tom!

TOM ELLIOTT: People do that all the time and you and I know each other!

ALAN TUDGE: We do Tom, we were talking about your father only just beforehand actually…

ANDREW FORREST: You've got to give him my best regards, he's a champion.

TOM ELLIOTT: I will. Now you've seen Mr Forrest's report and this idea which is putting I think in very nice terms to people, the reality is we're trying to stop people who go out and spend their welfare money on drugs and alcohol and gambling, we're trying to say to them, look we're going to manage your expenditure a bit more.  And I believe this happens in Aboriginal communities. Should we roll out this type of income management if you like for want of a better term to all Australians, not just Aboriginal ones?

ALAN TUDGE: It happens in some Aboriginal communities, particularly in the Northern Territory already. What Forrest has proposed to us and he gave us his report a couple of months ago, was a whole suite of recommendations.  But one of the centrepieces is this  idea of placing your welfare payments on a cashless debit card, which you could spend on absolutely anything, at any store, but you couldn't purchase alcohol with it and you couldn't gamble with it.  And because it's cashless or close to cashless you can't purchase drugs with it.

Now we're taking this very, very seriously because we know that there is too many places, there's too many people whose lives are being destroyed by grog and by drugs and by gambling which is paid for by welfare dollars. It's acute in many Aboriginal communities but it's not exclusively to those.

We also know of many people who go homeless because they fall behind in rental arrears despite getting welfare payments to pay for their rent.  So this idea actually could be a very useful tool to apply to vulnerable Australians be they black or white.

TOM ELLIOTT: Ok, so let's not beat around the bush then, what we're really saying is that if it is obvious you are misspending your welfare money, you're drunk all the time, you're on drugs, or you're buying cigarettes, you're gambling a lot, and really no-one who is on welfare should be gambling.  If you're doing that, the Government policy might be to take away that flexibility and say look, you must have enough food, you must pay your rent, you must pay utilities. Do those things…

ALAN TUDGE: We're looking at this very closely. We're talking to the banks right now about what's technically possible to implement.  But I can tell you this Tom, we've already got some trials in place right now with something similar.  There's a trial in Shepparton for example and 350 people- Indigenous and non-Indigenous- are on what's called a Basics Card where it's a similar mechanism.  And the most interesting thing about this and that just applies to vulnerable people, the most interesting thing about that number though is almost 200 out of those 350 people are people who have volunteered to go on the card, because they've thought that it's going to be a useful tool for themselves to help them manage their finances.

TOM ELLIOTT: Alright, Twiggy Forrest and Alan Tudge are going to stick around. Your calls 9690 0693, 13 13 32. So what do you think?  If you can't manage your own expenditure and you're on welfare, should the government do it for you?

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TOM ELLIOTT: Taking your calls. We're discussing radical welfare reform. Julie, go ahead.

CALLER JULIE: Good afternoon gentlemen. I work in the hospital system so what amazes me is when a patient comes in to be triaged at the desk it's asked are you a Torres Strait
Islander of Aboriginal descent. If they're of Aboriginal descent we have an Aboriginal liaison officer that runs around after them. Now the elderly white Australian person that comes in we don't ask them if they are white Australian, they don't get anything and I think it's unfair to put the split between the two because really we're all Australian.

TOM ELLIOTT: Well Julie I agree. In fact, I've got to fill out a form for my daughter going into primary school next year and one of the questions is, is she an Aboriginal or Torres Strait Islander? Mr Forrest I'll go to you first, I mean should we treat Aborigines differently or the same? Why do we need to make this distinction?

ANDREW FORREST: No we should treat everyone the same.  This is that soft bigotry of low expectations and where it's repeated such as in school turnout and the like where you just

look the other way. That becomes the racism of low expectations and Indigenous people they can go blow for blow with any other Australian.

TOM ELLIOTT: Alan Tudge what do you think?  Why on my daughters form to go into school should we have to either tick or not tick a box saying she's of Aboriginal or Torres Strait Islander descent?

ALAN TUDGE: I don't know the answer to that question, Tom.  I presume it's just to collect statistics so that the school knows how many Aboriginal people they've got there…

TOM ELLIOTT: They don't ask anything (inaudible)

ALAN TUDGE: (inaudible) my daughters' school to be honest but I could be wrong.

TOM ELLIOTT: In fact I did write when she first went in I wrote, I tried to think of all the ancestors and my wife had from different parts of the world and I said she's Scottish, Cornish, Czech, German, English, something else, something else , something else.

ALAN TUDGE: I think the point you're getting to which I would agree with is that we have to move to a place where we now have programmes and funding which is based on disadvantage rather than indigeneity. We are certainly moving from the federal perspective towards that direction.

TOM ELLIOTT: Scott, good afternoon.

CALLER SCOTT: Good afternoon gentlemen. Look I'm a teacher in health community studies and I work in welfare and I have for about eight years specifically drug and alcohol and the two points I wanted to make was the first one is Mr Forrest it's absolutely fantastic to hear somebody mentioning about not just giving a handout and expecting that to fix people's lives. We need to go to the core of the issue which is creating the problem in the first place and I work at a drug and alcohol rehab and that's the problem that we see in the case management. The second part was though with these cards, it will not prevent these  people seeking to use those drugs and those behaviours especially with quitting
cigarettes. My concern would be, where will they then go to get those and what sort of
currency would they use and would it go underground if they were using those cards?

TOM ELLIOTT: Well that's an interesting point Scott.  Twiggy what do you think, I mean you could imagine a scenario where a woman who was addicted to drugs, suddenly doesn't get cash welfare and who knows does she turn to prostitution or something to replace that missing cash income?

ANDREW FORREST: That argument hasn't be put to me from anyone from remote communities or vulnerable Australians black or white. What's been put to me is that 'listen Twiggy we're going to take our non-cash welfare and we're going to go down the green grocer and buy $500 worth of groceries and we're going to flog it for $200 and we're going

to buy our crystal meth with that $200.' And I'm saying actually that's not a bad result.  That means you've just fined yourself $300 because you want to go on crystal meth so there's
$300 less crystal meth which you're going to be able to buy and further you're probably going to take that $300 and sold it to someone else.  So I think actually in that case the system worked.

TOM ELLIOTT: So Alan Tudge, if what Andrew just described there is the case that someone who might've got $500 cash welfare to spend on drugs now gets only $200 after they buy something and then sell it.  Is that a victory of sorts under this system?

ALAN TUDGE: Listen, no system is ever going to be perfect and we're working through all of these issues which have been raised.

The analogy which I make to the callers suggestion was that I look at places and particularly at Indigenous remote places which have tried to restrict alcohol. So on the supply side, if you like, and yes you still get some grog runners who take alcohol into those communities but at the same time, they have a marked impact on the level of violence, the level of assaults in those communities.

So you're still getting enormous benefit by having supply restrictions.  Now what Twiggy's recommending is in essence hitting the demand side.  So it's limiting your cash and I still think that would have an equally significant impact as restricting supply.

TOM ELLIOTT: So we're not going to eliminate the problem but if we can reduce it, that's better than doing nothing?

ALAN TUDGE: Of course it is.

ANDREW FORREST: Yeah I'd much rather do the drug dealers out of a job than our kids.

TOM ELLIOTT: Absolutely. Grant, hello.

CALLER GRANT: Yeah I was having a same point with the cashless card. Pensioners, I see a lot of pensioners spending what they've got left of their pension on the pokies.  I see the young people, they pay whatever they need to and whatever is left they'll spend on drugs and then they supplement their drugs and their alcohol with petty crime.

The less cash they've got the petty crime won't be so petty.  It simply won't work.  You can't stop someone who's an alcoholic from wanting to have a drink.  What you've got to stop and I don't know if Andrew has identified this is the fact that the welfare has now become a lifestyle that these people make do on and live on and never change.

TOM ELLIOTT: Well that's an interesting point and Andrew you touched on this in your opening remarks when you said that a lot of Aboriginal welfare has- I think they call it sit down money in some communities where for generations people have got too used to the

idea that you don't actually have to do anything to be supported.  How do we get people away from thinking like that?

ANDREW FORREST: Look there is multi-generational welfare and I agree with the caller, it's a disaster.  And I do think that's exactly because we've given up on our fellow
Australians.  We've just handed out cash and we've ticked our conscience box and then mate see you later.

I think we should take that extra step. I think we should put the drug dealers out of a job and not the poor son or daughter that's watching mum and dad be out of work and saying well if that's the road to hell for me I don't much like it.

The caller also talked about petty crime.  If you roll out the welfare card in vulnerable communities, you don't do it without rolling out first, very good counselling, very good service providers, even a much stronger police presence, because yes sure, a severe alcoholic and drug addict will try and compensate.  But they will eventually come off alcoholism or eventually come off their drugs.

The community which emerges after that is much safer for everyone and for kids community it's a much stronger community and it's worthwhile going through that challenge.

TOM ELLIOTT: Darren, go ahead.

CALLER DARREN: G'day Tom, Andrew, and Alan.  Personally I don't see this as radical welfare reform at all. I see it as a sensible proposal.  But Tom, really, I can already see the wailing from Christine Milne. Will this thing ever happen?

TOM ELLIOTT: I don't know if Christine Milne is listening.  I don't know if she spends a lot of time listening to 3AW, although occasionally she does appear on the programme.

Alan Tudge, Christine Milne and the Greens, will they agree to this?

ALAN TUDGE: They won't, but…

TOM ELLIOTT: You sound very convinced of that.

ALAN TUDGE: I am very convinced about this. To the callers point, there is trials in five suburban locations presently of a model which is not dissimilar to this.  These trials were actually put into place under the Labor Government about 18 months ago.  They came up with the card, and Shepparton is one of those examples.

So we've got a model where it is occurring. We're taking this very, very seriously to see where it can be applied furthermore.  We're taking consultations right now, we're discussing it, we're engaging with people before we do anything.

TOM ELLIOTT: Very quickly, obviously if you want to get people off welfare, getting them into a job is the best thing to do. I am one of those people who says that I'm not really sure government can just create jobs – if you could, there would never be unemployment.

But Andrew Forrest, you employ a lot of people especially in WA. Is there anything more than government could do, given that Alan Tudge is here, to put some more jobs alternatives on the table for people who have been on welfare for a long time?

ANDREW FORREST: No, I think just pull the impediments out of the current system. Very clearly, the government is out there really trying to encourage employment, encourage jobs, but then – and this is the sticking point between myself and the government, as we don't agree on everything – we put out to tender around $5 billion worth of contracts to employment service providers, I put that politely in inverted commas, when I proved in our report that less than 5 per cent of industry, and it's falling, less than 5 per cent of industry use these billions and billions of dollars of taxpayer funded employment service providers.

So I've asked government to put a condition on that, to say look, if you insist on spending all our precious taxpayer funded capital on employment service providers, at least get them to perform. At least don't pay them until our fellow Australians, the people they are meant to be helping into work, have been in work for 26 weeks. That's the litmus test, that's tells you whether or not this person is going to stay in work because you've changed his or her life.

Still the government hasn't grasped that nettle – it's improved, but it hasn't grasped it. I really ask government to think about this. Don't go wasting any more billions of dollars. I call it the cash barbeque, let's stop it.

TOM ELLIOTT: Cash barbeque. Alan Tudge, very quickly, will this report just be stuck in a draw and allowed to gather dust or are you going to do something with it?

ALAN TUDGE: We will be doing something with it. We've never had such a report like this directly delivered to the Prime Minister. It is ambitious, it covers from early childhood all the way through to training and employment and absolutely, we'll be acting upon it.

TOM ELLIOTT: Alan Tudge, Parliamentary Secretary to the Prime Minister, Tony Abbott, and Twiggy Forrest, Chairman of Fortescue Metals Group, thank you both very much for you time.

ALAN TUDGE: Thanks so much Tom.