Human rights

Cashless Debit Card: Income management and the surveillance state

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The Cashless Debit Card is a radical attempt to monitor and control legal behaviours based on class, which infringes basic human rights. Rosie Williams reports.

PHILOSOPHICALLY SPEAKING, the debate for and against income management of welfare recipients typically balances the belief in the right to freedom of choice against the argument that freedom of choice and the right to a private life can be limited when they bring substantial harm to the self or others.

The Parliamentary Joint Committee on Human Rights is the body in Australia with responsibility for evaluating new legislation against international human rights, reporting on 'whether any identified limitation of a human right is justifiable' according to the 'limitation criteria'. 

They do this with reference to the information provided in the Explanatory Memoranda Bill and find that where limiting the right to a private life, the

'... existence of a legitimate objective must be identified clearly with supporting reasons and, generally, empirical data to demonstrate that [it is] important.'

And that:

'To be capable of justifying a proposed limitation of human rights, a legitimate objective must address a pressing or substantial concern and not simply seek an outcome regarded as desirable or convenient. Additionally, a limitation must be rationally connected to, and a proportionate way to achieve, its legitimate objective in order to be justifiable in international human rights law.'

Since the Committee’s report (based on the original Bill) was tabled, the Explanatory Memorandum to the Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 has been updated to specifically argue for limiting the right to a private life. In addition, Orima’s recently released 'Cashless Debit Card Trial Evaluation: Final Evaluation Report' is likely to be used as the "empirical evidence" (despite its methodological weaknesses) demanded by the Human Rights Committee.

In spite of these changes, what the government has failed to overcome is the logical fallacy that introducing income management in areas defined by their difference from the rest of the country cannot reasonably be used to justify a nationwide rollout.

Applying blanket income management to ten per cent of the population – the vast majority of whom reside in areas with no evidence of the issues identified in remote Indigenous communities – raises doubt that the Social Services Legislation Amendment (Cashless Debit Card) Bill 2017 is consistent with international human rights obligations.

The right to a private life tends to be a condition we take for granted until someone threatens to take it away but constitutes Article 17 of the International Covenant on Civil and Political Rights:

1. No one shall be subjected to arbitrary or unlawful interference with his privacy, family, home or correspondence, nor to unlawful attacks on his honour and reputation.

2. Everyone has the right to the protection of the law against such interference or attacks.

The Committee explains our right to privacy as:

'... linked to notions of personal autonomy and human dignity: it includes the idea that individuals should have an area of autonomous development; a "private sphere" free from government intervention and excessive unsolicited intervention by others. The right to privacy requires that the state does not arbitrarily interfere with a person's private and home life.'

Cashless income management requires that the entire transaction history and details of any taxi rides are shared with government — an obvious denial of any sense of privacy and only one of a list of limitations with no justifying logic.

It should be noted that it is not illegal in Australia to buy alcohol, gamble or choose the method of paying rent that best suits our landlords. So, the imposition of a policy that will prohibit one in every ten people from carrying out these perfectly legal actions is a radical step away from the philosophy of a liberal democracy and into social control through a surveillance state.

The characteristics of the communities where the Cashless Debit Card is being designed to work have little in common with most of Australia. In many ways, the remoteness, the lack of class and racial diversity, the strong kinship ties and culture that characterise Indigenous communities, coupled with their isolation from the economy and law enforcement, combine to create situations the card is designed to cut through.

The lack of commercial options in remote communities means that restrictions can be applied without significantly impinging the way people spend money. Government housing of welfare recipients in Indigenous communities means that the inability to pay private rent or mortgage with the card does not reflect the likely outcome when the card is introduced in areas where a majority of welfare recipients are in the private rental market.

In their submission to the Forrest Review, 'Indigenous Jobs and Training', that has since been removed from public view, the Australian Banking Association speaks out strongly against the use of banks in administering income management — the blanket approach intended by the policy and the technical feasibility of cashless income management:

... currently there is no technology that would enable a card to block transactions or payments at individual purchases or allow some purchases and not others from a particular MCC [Merchant Category Code]. This change would require a substantial overhaul of the existing EFTPOS system in use by all Australian retailers to identify goods individually and if necessary preclude their purchase prior to check-out. It would require new EFTPOS devices and new transaction instructions (electronic messages and codes) to be introduced, which would potentially disrupt the efficiency of the payments system and increase the cost of point of sale transactions for all users.

It is unclear how the government overcame these technical issues. It may be the case that the use of debit cards that function only with a white-listed range of Merchant Category Codes (MCC) prevent cardholders from using them to pay private rent or mortgages without specific white-listing of each and every private landlord by Indue — an approach which is bound to cause turmoil if the card is rolled out nationally.

A total of the 2013 figures for working age income support recipients in receipt of rent assistance (and therefore in the private rental market) put the figure at nearly 850,000 (National Welfare Rights Network, 2014). According to this report, when considering sole parents in receipt of income support alone, 'One-in two of those single parents (almost 35,000 people) were in the private rental market and receiving Rent Assistance' and will be affected by changes to how they pay for housing.

Given the well-publicised problems Centrelink has in managing customer enquiries, one can only imagine the mayhem that will unleash when hundreds of thousands of renters are forced to ask Centrelink to make "special arrangements" with Indue to allow them to pay their rent.

The attempt to monitor and control legal behaviours of legally competent adults based on our being a member of a certain class of people is a radical step past where even the more neoliberal United States has feared to tread. When the Government of Massachusetts commissioned research into options for cashless income management to prevent "inappropriate use of cash benefit assistance" in 2012, the scope of their research was careful to only examine the use of cash welfare for illegal purposes, finding that this was likely to account for only tiny percentage of money spent, a conclusion echoed in other U.S. jurisdictions.

It is interesting to ponder why such observations are not available to inform policy making in the Australian context. Steve Allsop, former director of the National Drug Research Institute (NDRI), has confirmed that research indicates a link between extreme poverty and drug addiction, but that there is no specific figure that could quantify the difference in rates between addiction among welfare recipients and the rest of society.

In recent years, India introduced a cashless welfare system linked to a biometric ID system, which has been criticised for its potential to become 'an all-encompassing cashless surveillance program with no opt-out provisions'.

The interesting thing is that this system was introduced not “under the premise of preventing identity theft and social welfare fraud” of India’s poor but to control “corrupt politicians and bureaucrats who often stuff welfare rolls with fake names and take the money for themselves”.

It is testament to the impact of neoliberal economics on Australian politics that the administration of social security legislation is being increasingly outsourced to the private sector — first with the much-corrupted job networks and now through cashless welfare.

The administrative payment to Indue of $10,000 (ABC, May 2017) per participant to be made on behalf of all 2.5 million working age income support recipients, coupled with the use of income support funds to capitalise Indue’s evolution from an authorised deposit-taking institution to a fully-fledged bank, is not only a gross example of largesse but a strategic advance in shifting social security administration away from government and into private hands.

In an acknowledgement of the dissent surrounding such a controversial and questionable policy, a Senate Inquiry was recently called to investigate the Social Security Amendment (Debit Card Trial) 2017 Bill, with public hearings set down for Kalgoorlie and Canberra. I will be making a submission to this Inquiry and encourage you to protest along with me. Anti-Poverty SA has published a helpful resource to support people in making submissions to the Inquiry.

As a citizen journalist who may potentially be subject to cashless income management, I intend to continue my investigations. If you wish to support this important work please consider a contribution and keep an eye on developments.

Rosie Williams is a citizen journalist who runs privacy workshops at You can follow Rosie on Twitter @Info_Aus.

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