ALAN JONES: Alan Tudge, thank you for your time. Tell us where you are on this?
ALAN TUDGE: We’re introducing legislation tomorrow morning Alan to authorise a trial in up to three locations across Australia which will introduce this cashless debit card. The concept is pretty simple. At the moment as you probably know we allocate welfare every fortnight into people’s savings account which they can access in cash. Instead of doing that we’re going to put 80 per cent of all their welfare payments into an account which is only accessible via a Visa or EFTPOS debit card which will work anywhere, you can purchase whatever you like but it simply won’t work at the bottle shops, it won’t work at gambling stores, and you won’t be able to take out cash with it, so you can’t purchase illicit substances. We think this could have a dramatic impact on some of the welfare fuelled alcohol and drug and gambling abuse which is rife in some communities.
ALAN JONES: So are you saying that the banks, and outfits like Coles and Woolworths and IGA and those outfits, have the technology to so use such a card?
ALAN TUDGE: That’s right. I’ve been working with the financial services institutions for six months or so now and we’ll be designing a card where the technology is relatively straightforward. It will simply block every liquor store, and every gambling house from the operability of this card across the country. Otherwise the card will work everywhere. The aim is to give as much freedom for welfare recipients to spend their money as they like with the exception of those prohibited products and we think this is absolutely worth trialling and we’re intending to do that from early next year.
ALAN JONES: What if Graham’s got a general store in Dubbo? Or take a smaller community than Dubbo, and you sell everything in the one store, don’t you?
GRAHAM RICHARDSON: Coonabarabran or something like that.
ALAN JONES: Coonabarabran or somewhere, and he’s going to sell liquor and wine and whatever. How’s he going to deal with this?
ALAN TUDGE: Different states have different liquor licencing laws. In a state like South Australia or Western Australia where we’re likely to start our trial sites, you can only sell liquor in dedicated liquor outlets, so it’s more straightforward there, you can simply exclude those stores from the operability. Where there’s a store which might sell liquor and might sell other food or goods, typically they’ll sometimes have two EFTPOS machines or we’ll encourage them to do so. One EFTPOS machine won’t work if it’s selling liquor, the other EFTPOS may indeed work if it’s selling groceries and other products.
ALAN JONES: What’s this thing called? It’s called a Healthy Welfare Card is it? Because Australians don’t know anything about this, it’s called a Healthy Welfare Card?
ALAN TUDGE: This actually came about from Andrew Forrest, it was his recommendation about 12 months or so ago now and he recommended this apply across Australia. We’re not suggesting it apply across Australia, but rather we’ve decided let’s at least just trial this thing in a handful of locations where there is high welfare fuelled alcohol and drug abuse. The first site we’re going to do this in is in the Ceduna region in South Australia. We’ve had a lot of consultation, even co-design with the community leaders down there so that they’re willing and want to participate in this trial. The name of it we’re going to be calling it is the Centrelink Debit Card. Effectively that’s what it is. All your Centrelink payments will go onto that card. It will be a debit card similar to every other debit card.
GRAHAM RICHARDSON: Can I ask you two questions? It seems to me, Alan made this point at the start, he raised this with me last Thursday morning when we were doing a promo for this show and I had never heard of it. I had never heard of it. Now every morning I buy the four papers in Sydney. I sit in the coffee shop, I have my flat white and toasted ham and cheese and I read those four papers. I spend an hour, hour and half every day doing that. How is it that I missed this?
ALAN TUDGE: I don't know Richo because it’s been the front page of some of the daily tabloids. It also was the front page of the Australian newspaper just last week.
ALAN JONES: Graham’s right Alan, you’re bad sellers aren’t you, of such an idea, I mean I don’t think most people even understand do they, what you’re saying is all welfare payments will go into – if I was on welfare – Alan Jones’ account, so I don’t touch that, and with it I get, what do you going to call the card?
GRAHAM RICHARDSON: The Centrelink Debit Card.
ALAN JONES: The Centrelink Debit Card? God that doesn’t tell us much, it’s complicated, the Centrelink Debit Card, I like the Healthy Credit Card really. So I’ve got the card and I can go out and buy what I want but you can guarantee that at Ceduna, in the trial, that you won’t be able to buy grog and you won’t be able to get…can I get cash out?
ALAN TUDGE: You won’t be able to gamble with it…
GRAHAM RICHARDSON: Only 20% cash.
ALAN TUDGE: …and you won’t be able to get cash with it. Only 20% so 80% of the payments will be locked into this card.
ALAN JONES: But I will be able to get cash?
ALAN TUDGE: You’ll be able to get 20% cash.
ALAN JONES: Right.
ALAN TUDGE: At the moment, all of your welfare payments, every fortnight go into your cash account.
ALAN JONES: Yes.
ALAN TUDGE: That’s how it works, the money just gets dropped into a person’s cash account. Now when this begins, and it will be early next year, 80% of your welfare payments will go into a new account which is only accessible via this debit card. So everywhere you go you’ll be swiping this card and put in your pin number if you want to get your groceries, take a taxi, you want to do whatever you like and you’ll still be able to access 20% of your payments through your normal savings account.
GRAHAM RICHARDSON: Can I ask you, what arguments were used against this? Now, it’s stalled in the Senate, what were those voting against it saying, because I’m trying to work out what’s wrong with it.
ALAN JONES: It hasn’t got there yet, I think I got that wrong, but there’s talk they…
ALAN TUDGE: It’s being,.... we’re introducing this into the House of Representatives tomorrow. I’ve been having ongoing engagement with the crossbenchers and indeed the Labor Party for the past few months…
ALAN JONES: Do you have the numbers?
ALAN TUDGE: …with the aim of getting their support. I’ve had very constructive conversation with them and I hope that they not only listen to me but they also listen to those community leaders in Ceduna who want this trial to occur. Time will tell, I’m very hopeful, but there are some people of course who for, and this includes the Greens, for ideological reasons just say that people should be able to spend their welfare on whatever they like, even if they’re spending every dollar on the pokies on day one and there’s no food on the table for the kids. Or even if they’re spending half their welfare payments on alcohol and it’s ending up…
ALAN JONES: But the Greens don’t count…
ALAN TUDGE: …significant violence towards women.
ALAN JONES: Alan, let’s not pussy foot around, the Greens don’t count if the Labor back the legislation, now are they…
ALAN TUDGE: To be honest, Labor haven’t declared their hand yet, I’ve had constructive discussions with them, they were initially sceptical to be honest, they were sceptical about the position but I’ve engaged with them and I think they’ve been listening to the community leaders who I’ve been co-designing this trial with who are actively calling for, and publicly calling for the legislation to go through the House and I hope they listen to those community leaders and allow this trial to occur.
GRAHAM RICHARDSON: Why would we restrict it to indigenous communities? I can recall some years ago…
ALAN JONES: I don’t think it is.
ALAN TUDGE: No it’s not Richo, I want to make this very clear, this is not an indigenous card and in the Ceduna region, about two thirds of people captured will be indigenous and a third will be non-indiginous. Everybody who’s on an income support payment i.e. they’re on New Start on the Disability Support Pension, they’re on a Carers Payment and the like will be captured by this trial.
GRAHAM RICHARDSON: So you’re saying the whole of Australia, if I’m unemployed and I’m on a benefit, or a pension…
ALAN JONES: That’s down the track…
GRAHAM RICHARDSON: …are they all covered?
ALAN JONES: No, because it’s just a trial. You profiled Ceduna and the reason you started there, can you explain why you started there.
ALAN TUDGE: Sure, right at the get-go when we announced that we wanted to proceed on a trial basis, we said we would choose locations which satisfied two criteria. One, where there is significant welfare fuelled alcohol and drug abuse and Ceduna certainly satisfies that. Their hospitalisation rates from assault are 68 times above the national average, most of which is related to alcohol. The second criteria was for there to be an openness if not a willingness from community leaders in the trial location to participate in the trial. And Ceduna has got terrific leaders there who wanted to step up, who wanted to work very closely with us in designing this trial, and they’re absolutely locked in behind this now to the extent now that we will be implementing this together with the start date being early next year.
ALAN JONES: What do you mean when you talk about data mining technology, which will monitor the use of the card and unusual sales and purchases, now that suggests to me that you’re not confident this is fool proof.
ALAN TUDGE: Alan there will always be people who try and get around things such as this and inevitably some people will succeed. However, we are going to put in place some mechanisms to try to prevent as much as possible illegal practices occurring. One of those mechanisms will be what the credit card company’s do now, where they’ll be able to track at the macro level some of the expenditure patterns and if they see an unusual transaction occur, for instance if your typical taxi fare is ordinarily say $50 a fare and all of a sudden there’s all these $200 and $300 fares being charged then a red light will flash and perhaps that taxi driver has been charging people a couple of hundred bucks, then giving some of that back in cash to that person. So we will be able to pick up that type of behaviour through this card.
GRAHAM RICHARDSON: Can I ask you, if I’m living in Ceduna and I know I’m under this sort of scrutiny what’s to stop me driving 100 kilometres down the road and doing it somewhere else? Does this technology during the trial hold in other places?
ALAN TUDGE: It will work across the entire country Richo, so that card will travel with you. It’s a basic Visa card for example or an EFTPOS card which means it will work in every single location across the country but it will not work in any liquor store in the country either. We will switch off what’s called the merchant category code which relates to liquor stores so you might drive into Adelaide and none of the pubs or bottle shops are going to work, but the supermarket will.
ALAN JONES: That’s a very good point that Graham’s made. So you’re saying that even though the trial is in Ceduna, the technology will be nationally operative so if somebody left Ceduna and went to Brisbane, the 80-20 split would still apply.
ALAN TUDGE: It would still apply and there won’t be a bottle shop in Brisbane that will work on that card.
ALAN JONES: So just coming back to that 80-20, so what you’ll do is will be to take whatever the welfare payment they are entitled to, you’ll put 80 per cent of it into this particular account where the card works and 20 per cent goes into their bank account. So the 20 per cent they’ve got their own normal access to and the 80 per cent goes in where you can only access it with this Centrelink Debit Card.
ALAN TUDGE: That’s right.
ALAN JONES: Even though the trial is in Ceduna, that debit card will secure the same response anywhere in Australia?
ALAN TUDGE: Anywhere in the country. That card will travel with you. If you need to use it to purchase a hotel for a room for a night, it will work.
ALAN JONES: But not every retailer is Woolworths or Coles.
ALAN TUDGE: What’s going to happen with the technology Alan, is that every single retailer in the country will be switched on to the card, similar to what your VISA card is at the moment. Most people who are watching this have probably got a VISA card or a Mastercard which works everywhere. But we will switch off from the operability of that card every liquor store in the country and every gambling house in the country. You can do that from the technology perspective because whenever a retailer signs on to being a VISA card operator, it has to give what’s called a ‘merchant category code’. If it’s a liquor store it’s a liquor store merchant category code. We will switch that off so no liquor store in the country will work on this Centrelink Debit Card.
ALAN JONES: So this is a 12 month trial in Ceduna in South Australia. Is there anywhere else?
ALAN TUDGE: We’re in advance discussions with the leadership in the East Kimberley but we’ve still got a bit more work to do before we can determine whether or not we’ll proceed there but it’s likely to be the case. Then we’ll have the capacity for a third location as well, Alan.
ALAN JONES: What do you mean when you said that aged pensioners and workers may volunteer to opt in?
ALAN TUDGE: The people who will be covered by the trial will be every working age person on an income support payment.
ALAN JONES: 65 and under?
ALAN TUDGE: Between 17 and 65. For aged pensioners, you will not be automatically captured but you will have the option to volunteer into the program and many people will. There will be some workers who many also want to have their salaries paid into this account. This is particularly the case Alan in Indigenous communities where there’s this thing called ‘humbugging’ which is a cultural practice where family members will often be asked for money from others and there’s almost a cultural requirement to hand over money. If you’re the only person, because you’re a senior person, who has access to cash then you’re going to be humbugged a lot. I would expect many senior people will also volunteer for the card.
ALAN JONES: Am I right in saying that 80-20 isn’t hard and fast. Now I understand, and this is your language, that some local authority will be established in the region which would have the power on application to adjust the amount that’s placed into the individuals debit card, in other words, let them get more cash. So the 80-20’s not in concrete?
GRAHAM RICHARDSON: Or less?
ALAN TUDGE: Yes that’s right. It will start at 80-20 for everybody but what we’re going to do is have a local authority in place and if you’re a responsible individual, you’re doing all the right things, you’re not a big drinker, you’re not a big gambler and you’re sending your kids to school, and you feel a bit aggrieved from being on this card for whatever reason, you can apply to a local authority, make the case that you are doing all the right things and that local authority can make an adjustment such that, say, only 50 per cent of your payments go onto the card instead of 80 per cent.
ALAN JONES: I think that might work.
GRAHAM RICHARDSON: You never know.
ALAN TUDGE: That’s in part there for two reasons. One, to give some of the local leaders local authority, if you like. The second thing being to set some cultural norms also in relation to school attendance, participating in your work for the dole scheme and the like. If you are doing those things and you want a bit more cash, you can apply and get some.
GRAHAM RICHARDSON: I think it’s an outstanding idea but listen we’ve got to go. But I have to ask you one question not on this.
ALAN JONES: One question before that. What’s wrong then with everyone… are you saying the end result will be that everyone on welfare would have this card and be governed by the way the card functions?
ALAN TUDGE: That will be the case in the trial sites. We’re going to take this one step at a time. We’re going to trial it, we want to assess it, we want to evaluate it and then we’ll make decisions from there as to where we might roll it out subsequently.
GRAHAM RICHARDSON: Ok look, I’ve got to ask you this question. When Robert Menzies founded the Liberal Party he said it was the party of the individual. I can’t think of an issue more to do with individual conscience than gay marriage. Why is it that in the party of the individual, the individual conscience no longer matters and you won’t give people a vote according to that conscience?
ALAN TUDGE: Well the ultimate form of individualism is a plebiscite. Every single individual in the country will be able to exercise their conscience on this.
GRAHAM RICHARDSON: But not for at least two years. Why not now? If that’s the case, why not now? Why do you have to wait?
ALAN TUDGE: Richo, this is a 2000 year old institution. Let’s take it carefully. The people do want to have a say on this and we’re going to give them that say. Every person will be able to decide. [inaudible]
ALAN JONES: The Labor Party won’t give them a say.
GRAHAM RICHARDSON: I tell you what, we support the plebiscite. You can’t [inaudible] the Labor Party on that.
ALAN TUDGE: The Labor Party won’t give them a say.
GRAHAM RICHARDSON: The Labor Party will give their members a free vote. This mob wont. [inaudible]
GRAHAM RICHARDSON: We’ll have to agree to disagree on this.
ALAN JONES: Well done on the welfare card but let’s make sure we tell the world about it, Alan.
GRAHAM RICHARDSON: We’re in heated agreement on the welfare card. Well done. It’s an outstanding idea. Alan Tudge, thanks for your time.
ALAN TUDGE: Thanks so much.