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Controversial cashless welfare card to be scrapped

·Yahoo Finance Editor In Chief Australia
·2-min read
card in wallet
Thousands of people will be transitioned off cashless debit cards if the welfare scheme is scrapped. (Source: Getty)

The controversial cashless welfare card is set to be abolished by the Albanese Government today after a report released by the Australian National Audit Office (ANAO) found the program was not effective, nor did it assist in reducing social harm.

Social Services Minister Amanda Rishworth said in a statement released today that legislation would be introduced to abolish the program, allowing approximately 17,300 participants to move off the Cashless Debit Card with the option of voluntary income management.

Rishworth said the legislation was the result of widespread community consultation, and that the response was loud and clear.

“The Cashless Debit Card stigmatises and it often makes participants’ lives more difficult because they cannot access the cash economy,:” she said.

The former government introduced the program in 2016, as a trial in Indigenous communities in South Australia, West Australia, Queensland and the Northern Territory.

It limited up to 80 per cent of recipients’ welfare payments by putting the payments onto a card that users could not use to withdraw cash.

The aim of the program was to limit the amount of cash that could be spent on drugs, alcohol and gambling.

However, the ANAO report found the program did not meet its intended objectives and that the former government had failed to show the effectiveness of the program and had limited insight into its performance and impact, despite being in place for six years.

Rishworth said the program had cost the government more than $170 million - money that could have been better spent on services locals needed.

The legislation to abolish the card is expected to be introduced to Parliament today and, if passed, will see users transition off the program with community support and income-management support.

The Government will look at the future of income management over the course of this year, reflecting the outcomes of further community consultation.

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