Doorstop Parliament House, Canberra

Release Date: 
14 October 2015

ALAN TUDGE:   As you’d be aware, the Senate has just passed the Welfare Debit Card trial legislation.

It was passed with the support of the Labor Party and seven of the eight crossbenchers. I’d like to thank those crossbenchers and the Labor Party for supporting the passage of this legislation.

This is a watershed moment in how we deliver welfare.

What the legislation will enable is a relatively simple concept. Instead of placing all welfare payments into an individual’s cash account, eighty per cent will be placed into a person’s debit card account which is only accessible via a VISA debit card.

This VISA debit card will work like any other VISA debit card. It will work everywhere to purchase anything, but simply won’t work at the bottle shops and won’t work at the gambling houses and you won’t be able to get cash from it.

The overall objective of this is to reduce the very significant welfare fuelled alcohol, drug and gambling abuse in some communities.

I think that this will be one of the most innovative cards on the market once it is introduced. Not only will it have the features which restrict alcohol and gambling being purchased with it, but also we will be connecting this card up to individuals’ mobile phones.

So when an individual uses the card, they will be sent a text message informing them about what their account balance is having used it. They will also get a text message informing them when a payment has been placed into their account and when their account drops below a certain level.

We’re hoping in this way it will greatly assist people to manage their payments over the course of a fortnight.

Along with the introduction of this card will be a support package, particularly drug and alcohol services and financial management services. Our support package for Ceduna has already been tabled and it includes additional residential rehabilitation, 24-hour mobile outreach, additional drug and alcohol counselling in every single community.

This will be a full frontal assault against alcohol abuse in that community.

The trial itself has been developed every single step of the way in consultation with the community leaders in Ceduna and with the community leaders in Kununurra. I’d like to thank them and acknowledge them for the work that they have done.

As I said, the objective of this is to significantly reduce the welfare fuelled alcohol, drug and gambling abuse which unfortunately is prevalent in so many communities. We hope that this trial, the combination of the card plus the support services, will have that impact of making those communities a safer place for everybody.

JOURNALIST:   Given the difficulty you’ve had in winning support for the trials, how confident are you that you will be able to roll this out more broadly into other communities or indeed across the country?

ALAN TUDGE:   The legislation just authorises a trial in up to three areas with up to 10,000 people covered. What we are going to do is evaluate the trial, assess how it goes and then we’ll make decisions from there as to how much further we might take it.

JOURNALIST:   What do you say to the people like Mick Gooda who said that the trial should be suspended or not go ahead due to concerns in the community?

ALAN TUDGE:   We’ve been discussing, particularly with the Ceduna leaders, for probably six months now. We’ve been having weekly meetings with them. Every single one of the five communities affected in the area of Ceduna have passed resolutions in favour of participating in the trial.

It’s actually been a complete co-design effort with those community leaders in Ceduna. I would ask Mick Gooda to speak with some of those community leaders. They were here in Parliament House actually on Monday and Tuesday and they would say exactly the same message.

JOURNALIST:   Senator Gallagher said it might lead to people turning to prostitution. What do you say about that?

ALAN TUDGE:   The nature of this card is you will be able to use this card to purchase anything, anywhere except purchase alcohol or gamble with it. However, twenty per cent of your payments will continue to go into your ordinary cash account.

If you are an individual with three children for example, that may still end up being around $300 of cash per fortnight.

JOURNALIST:   What is to stop them spending that $300 on alcohol? What’s to say that this card will be effective?

ALAN TUDGE:   This has been co-designed with the local community leaders. It is a trial. We think it will have a demonstrable impact on reducing that welfare fuelled alcohol, drug and gambling abuse in the community.

It is the combination of not just the card which restricts the availability of cash to spend on those items, but also the significant support services to assist people to eliminate their dependence or at least reduce their dependence on alcohol, drugs and gambling.

JOURNALIST:   What undertakings did you give to some of the Senators to win their support?

ALAN TUDGE:   I’ve been having consultations with the Senators now for probably two or three months, informing them of how the trial would be undertaken. I told them about the deep level of support that we have in Ceduna.

A few of those leaders came to Parliament House to speak with them, to inform them themselves how much they were supporting the trial.

I also agreed with Senator Lambie and Senator Xenophon that we would go back to Ceduna together and have a further public meeting with them to discuss any other outstanding issues which might arise.

JOURNALIST:   Were there any other undertakings?

ALAN TUDGE:   I’ve had numerous discussions over the last few months with the crossbenchers and the Labor Party. Indeed over the last few days with the Labor Party, as you probably know, Ms Macklin has written to me two or three times, outlining several issues which she has wanted addressed.

We have addressed those in a very thorough way and I am pleased that in the end the Labor Party did support this reform because it is an important reform and we were hoping to get bipartisan support for it and we have achieved that.

JOURNALIST:   How confident are you of being able to nominate the second and third trial communities in time for the trials to [inaudible]?

ALAN TUDGE:   We’re in advanced discussions with the leadership in the East Kimberley. We’ve still got some further consultative work to do but I am confident that in the next few weeks we’ll be able to make an announcement there.

In relation to a third site, we are at earlier stages of consultations in two or three other areas.

The Ceduna trial will begin at the end of February. The subsequent trials will be staggered thereafter.

JOURNALIST:   That meeting that you are going to have going up there with the crossbenchers, could that hold up the beginning of the trial at all? Or is that to negotiate whether to actually do it or not?

ALAN TUDGE:   This legislation itself authorises the trial to proceed in up to three locations. We will go out to Ceduna and then in the next sitting week we will table the instrument which specifies, assuming it goes well, Ceduna as the trial location.

JOURNALIST:   [inaudible] spending a night in Ceduna?

ALAN TUDGE:   We haven’t even worked out the date which we’re going yet because we have to coordinate diaries. But I know because I’ve been there five or six times in the last six months that there is only one flight in and one flight out so typically it involves a night away.

JOURNALIST:   Labor says they have secured an evaluation process for this card. When will you make the evaluation process public [inaudible]? They are also saying that they want to see more detail about the [inaudible]

ALAN TUDGE:   We’ve committed right from the get-go that we would do a full independent evaluation of the trial. I informed Jenny Macklin and I put this up on my website the outline of what the evaluation will look like.

It would consist of some quantitative analysis as well as some qualitative assessment i.e. we would be looking at some of the core indicators including the hospitalisation rates, the assault rates and the domestic violence rates.

We will also be doing some qualitative assessments asking people how they believe the trial is going.

We will be releasing further details about what the evaluative framework will be in the weeks and months ahead before the trial begins.

JOURNALIST:   What about the further details that Labor is calling for? They are asking for more detail on how the compliance of the card can be managed [inaudible] and how the community panel will make decisions.

ALAN TUDGE:   I know that question came up in the Senate committee process. What happens if a person during the trial leaves the location?

The answer to that is the card will go with them. They will be on the trial for the 12 month duration of it and should they move to a different location they will still have the card which will go with them.

The nature of this card is that it will work at every single location in the country, but there is not a single bottle shop in the country where it will work and not a single gambling house in the country where it will work and not a single ATM where you will be able to withdraw cash.

JOURNALIST:   How does it work at somewhere like IGA where you might have alcohol for sale and food?

ALAN TUDGE:   That is a particular peculiarity with the ACT and Victoria where you tend to have what is called ‘mixed merchants’. Where we are trialling it in South Australia you tend to have separate dedicated liquor outlets compared to your supermarkets.

JOURNALIST:   How does the technology actually work? Say you went to the counter and scanned in a bottle of beer and then swiped the card, how does that actually work?

ALAN TUDGE:   In essence it works at the merchant category code level. Whenever a retailer signs up to be eligible to receive a VISA card payment at their store, they have to indicate what type of business they are.

If they have specified that they are a liquor store, they will be coded with a merchant category code which corresponds with being a liquor store. We will switch off that code so that no liquor store in the country will work with that card.

JOURNALIST:   Are there any gaps there [inaudible]?

ALAN TUDGE:   There is one complication for example in Ceduna which is the Ceduna Foreshore Hotel. That is a popular destination. It has pokies there, it has a bar, and it’s got some nice meals and also accommodation.

Interestingly through, there are four terminals there for that. There is a terminal for accommodation, a terminal to purchase your meals, an EFTPOS terminal for purchasing drinks over the bar and also a terminal for the pokies.

We will switch off the latter two but leave switched on where you can purchase a meal and where you can use it for accommodation.

JOURNALIST:   At the Foreshore Hotel, could you order your steak and chips and a bottle of beer?

ALAN TUDGE:   So there is actually two separate locations where you do your ordering. You go and order your meal at one location where you pay at a particular EFTPOS machine, and then when you go and order a beer if you choose to do that, it is a different EFTPOS machine.

Of course you would still be able to use the cash component to purchase a beer, but you won’t be able to spend one hundred per cent of your welfare dollars on alcohol or gamble it away.

JOURNALIST:   What do you make of the local opposition to this? There was a petition tabled of 288 signatures. I know that the Mayor has said that the opposition is no more than one per cent of the town. Where do you [inaudible] the opposition and do you feel like you need to do more consultation?

ALAN TUDGE:   This is in Ceduna particularly?


ALAN TUDGE:   We’ve had an incredibly thorough consultation process. In fact it has been more than a consultation process, it has been a co-design process with the community leaders there.

The trial, if it goes ahead in Ceduna, will cover five communities. The boards of each of those five communities has passed a resolution in favour of the trial.

There have been public meetings which have occurred in each of those five communities, in many cases often led by some of the Aboriginal leaders there.

The Ceduna Municipal Council headed up by Alan Suter, they also passed a resolution in favour of this trial to participate in.

I think there are very few other substantial reforms which have occurred in the last few decades which have had this level of consultation, and indeed co-design work, before such a trial has been implemented.

JOURNALIST:   [inaudible]

ALAN TUDGE:   Now this is a mock-up of what the actual card will look like. It is a silver VISA debit card. This will operate like any other VISA debit card but simply won’t work at the bottle shops, it won’t work at the gambling houses and you won’t be able to take cash from it.

It will be one of the most innovative cards on the market not only because of the way it operates in restricting alcohol, but also because it will be connected to your mobile phone.

Consequently, you will get a text message every time you use the card, informing you of what your account balance will be. Consequently we think that will be a useful tool for managing your payments over the fortnightly cycle.

Thank you so much.