Federal Budget’s support of universal services undermined by divisive welfare approach

11 May 2017

It was heartening to see a shift towards a more socially responsive agenda in the Federal Coalition’s 2017/18 Budget. The foundations of community wellbeing and cohesion, such as health, education and housing, have returned within the core business of government alongside the economy. This upholds the Government’s responsibility to support all its citizens. 

We particularly welcome the reversal of unsustainable cuts and the signs of a renewed commitment to Medicare and equity in education. We hope this is the beginning of a much stronger investment in the future.

We are, however, deeply disturbed by punitive measures proposed for people who receive welfare under the Government’s "mutual obligation" regime. We believe these will undermine many of the positive social investments being made in other areas.

Introducing drug testing for welfare recipients comes dangerously close to criminalising poverty. It makes basic human rights conditional on not only job-seeking requirements, but on the absence of addiction. This demonises people who are already struggling with health issues and reinforces the worst kind of ignorance and prejudice. Furthermore, drug-testing welfare compliance regimes trialled elsewhere have proved an expensive failure at getting people into work and in supporting people to recover from addictions. In fact, evidence shows it makes finding a job more difficult.

It is equally horrifying to see reports that the proposed changes mean people with drug and alcohol-related disabilities will no longer qualify for a Disability Support Pension, and that drug and alcohol addiction will no longer be seen as a reasonable excuse for not looking for work. These highly discriminatory proposals ignore the connection between mental illness and drug addiction, and threaten to breach basic human rights.

The extension of the cashless welfare card into new locations ignores evidence from trial evaluations that nearly half of the cardholders felt it made life worse for them. The card is a barrier to exercising basic choices, self-determination and social participation: people cannot just reach into their pockets to offer petrol money for a shared ride, give their child pocket money to purchase a birthday gift or drop a coin into the community centre kitty for a cup of coffee. It is demeaning, shaming and an extremely blunt instrument to deal with complex circumstances of disadvantage.

Under the new regime, it is proposed that people on welfare who use drugs will be put on the cashless welfare card. This demonstrates that the cashless welfare card is a means of exercising punitive control and is another form of "income management".

These measures are all part of tightening requirements for welfare recipients that are already onerous in order to squeeze budget savings from people who simply cannot afford it. We know that most people are trying to get work, and that missed appointments are rarely "deliberate non-compliance". They are often due to unavoidable day-to-day events that are all too common for people living on a financial tightrope, such as having no petrol in the car, needing to help a family member or dealing with an ex-partner breaking a childcare arrangement. The contradictory or arbitrary implementation of the policy by job network providers also contributes to the problem.

People are not "rejecting" jobs – there are simply not enough jobs for the number of people looking for work. Having payments cancelled creates more financial mental and housing stress, at times leading to mental illness, homelessness and crime.

We are also concerned about the additional conditions for welfare payment for single parents, who are mainly women. This puts single mothers at risk of financial distress if they do not meet the conditions and feeds into the age-old prejudice against single mothers.

If the proposed measures are brought in, we fear the damage to people, families and communities will be severe, lasting and inexcusable.

The measures will be a very costly experiment, not just for individuals and families who are left without means of support, but also for the taxpayer. Granted, the government will squeeze $632 million in savings over five years, but in the long-term it will need to address the far greater cost to emergency services, health and justice systems, and the loss in productivity that these changes would bring.

We are also concerned about where people who are further forced to the margins are going to go to meet their basic human needs: food, shelter and security. The already stretched community service sector simply cannot meet increased demand, and nor should it be expected to.

The time is long overdue to take on board the mounting evidence of brain science that tells us how to reverse the downward spiral of unemployment. It is not through increasing stress, shame and constraint that people reverse their fortunes, but through supportive pathways to a real job, a live-able wage and a valued role in society.