Compulsory Income Management: a Critical Examination of the Emergence of Conditional Welfare in Australia

Australian Social Work

ISSN: 0312-407X (Print) 1447-0748 (Online) Journal homepage: http://www.tandfonline.com/loi/rasw20

Compulsory Income Management: A Critical Examination of the Emergence of Conditional Welfare in Australia

Philip Mendes

To cite this article: Philip Mendes (2013) Compulsory Income Management: A Critical Examination of the Emergence of Conditional Welfare in Australia, Australian Social Work, 66:4, 495-510, DOI: 10.1080/0312407X.2012.708763 To link to this article: http://dx.doi.org/10.1080/0312407X.2012.708763

Published online: 16 Oct 2012.

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Download by: [University of Wollongong] Date: 21 March 2017, At: 22:39 Australian Social Work, 2013 Vol. 66, No. 4, 495510, http://dx.doi.org/10.1080/0312407X.2012.708763

Compulsory Income Management: A Critical Examination of the Emergence of Conditional Welfare in Australia

Philip Mendes* Department of Social Work, Monash University, Melbourne, Victoria, Australia

Abstract The introduction of compulsory income management by the then Coalition Government in 2007 signalled the increasing policy influence of individualistic as opposed to structural explanations of social disadvantage. Using key policy and evaluation literature, this article critically examines the principal arguments for and against compulsory income management. Specific questions are raised about the top-down and coercive nature of compulsory income management, the lack of supporting empirical evidence, and its apparent discrimination against Australians who are Indigenous or reliant on income security payments, or both. Some conclusions are drawn about the potential for more effective policy solutions that would involve a genuine partnership with disadvantaged communities.

Keywords: Child Abuse; Indigenous Issues; Social Policy

Compulsory income management (CIM) is the quarantining of a set percentage of income security payments*usually somewhere between 50% and 70%*into a special account for the exclusive purchase of essential household items such as food, rent, clothing, and energy bills. Income managed funds cannot be used for prohibited items such as drugs, alcohol, cigarettes, gambling, and pornography (Australian Council of Social Service [ACOSS], 2010a; Australian Institute of Health and Welfare [AIHW], 2010). This article argues that the introduction of CIM by the Coalition Government in June 2007, and its continuation by the succeeding Labor Party Government, represents a fundamental shift in Australian income security policy from structural to individualistic explanations of social disadvantage. Individualistic or behaviourist interpretations of social disadvantage tend to assume that people are poor or unemployed because of behavioural characteristics such as incompetence or immorality or laziness. This view reflects the influence of neoliberal philosophy, which favours minimum government interference with free market outcomes. Neoliberals believe the government should act to motivate and

*Correspondence to: Associate Professor Philip Mendes, Director Social Inclusion and Social Policy Research Centre, Department of Social Work, Monash University, 51 Argyle Road, Kew, Victoria 3101, Australia. E-mail: [email protected] Accepted 23 May 2012

# 2013 Australian Association of Social Workers 496 P. Mendes discipline welfare recipients, and reintegrate them with mainstream social values and morality, such as self-reliance and the work ethic. Income security should shift from being a right or entitlement to a privilege. Welfare-reliant individuals should be pressured to choose employment over welfare (Billings, 2010; Murphy, Murray, Chalmers, Martin, & Marston, 2011). As we shall see, these objectives appear to be broadly reflected in the CIM scheme, which aims to promote personal responsibility and the work ethic, and discourage passive reliance on welfare payments (Macklin, 2010). In contrast, those who favour a structuralist approach to disadvantage, which is associated with social democratic philosophy, believe that social rights, including income security, should be guaranteed outside the operations of the labour market (Esping-Andersen, 1990; Goodin, Headey, Muffels, & Dirven, 1999; Mendes, 2008). Structuralists generally also recognise that individual behaviour and agency can influence social outcomes. Many would acknowledge that some welfare consumers engage in antisocial and self-destructive behaviour that does not improve their life situations. But they also argue that many poor Australians are heavily constrained by their limited life opportunities compared to others (Saunders, 2005). They believe that structural factors, such as social and economic deprivation and inequality, are significant influences on the prevalence of poverty, and that blaming the poor for their plight reflects a lack of compassion and is unlikely to improve their prospects. They note in particular that some individuals may need a long, long time before they

have recovered sufficiently from past traumas to access training or employment (Murphy et al., 2011). Consequently, the structuralist definition of the causes of social problems leads to entirely different solutions from those posed by behaviourists. For example, they would recommend that governments take action to improve access to affordable housing and education, create jobs, promote a fairer distribution of wealth and income, and generally facilitate the social and economic empowerment of the poor, including specific holistic measures to address Indigenous disadvantage (Mendes, 2008). This individualstructural divide arguably lies at the centre of contemporary debates about the future of the welfare state. Some writers argue that welfare policy analysis needs to transcend the binary approach to individual and structural factors. This argument is presented most convincingly by Young (2011) who acknowledged that social structures cause injustice, and that both rich and poor can behave irresponsibly. Nevertheless, she argued that it is still important to critically examine the choices and actions of individuals in response to social disadvantage. Some use their individual agency to act responsibly, and some do not. These arguments are useful in regards to CIM and the particular challenges it poses to social work for two reasons. First, they remind us of the importance of assessing the actual capacity and attitudes of individual income security recipients, rather than universally labelling all members of particular groups as dysfunctional. To be sure, control or coercion may sometimes be required to protect individual clients or their children or families from harm (Healy, 2005). Second, they fit comfortably with the reality of social work practice, which involves Australian Social Work 497 addressing both individual and structural issues via what is called the person in the environment perspective (Connolly & Harms, 2012). We will return to the particular implications for social workers in Centrelink in a latter section. Historically, many welfare systems included or excluded recipients on the basis of judgements about behaviour, morality, and race. However, since approximately World War II, most advanced welfare states have placed recipients in income security categories according to relatively objective eligibility criteria such as joblessness, sickness, disability, sole parenthood, and old age. For example, formal eligibility restrictions on Indigenous Australians were removed in 1966 (Billings, 2010). The specific philosophical aims of income security varied from country to country but it was generally viewed as a means of reducing poverty and inequality generated by the free market. However, recent decades have seen increasing conditionality with benefits tied to requirements around work and personal responsibility (King & Ross, 2010).

The Northern Territory Emergency Response and Further Income Management Initiatives The Australian welfare state has traditionally provided an entitlement to income support to those unable to work due to limited skills, illness, disability, sole parenthood, and old age. However, policy changes over the last three decades have

introduced far greater conditionality into the income security system. For example, the Labor Government’s 19861988 Social Security Review headed by Bettina Cass introduced contractual agreements linking unemployment payments to labour market participation (Mendes, 2008). The Coalition Government, which ruled Australia from 19962007, was strongly influenced by neoliberal philosophy, and imposed increasing obligations on income support recipients. Particular manifestations included compulsory mutual obligations on jobseekers such as the Work for the Dole scheme and requirements to seek up to 10 jobs each fortnight, and significant breaches and associated heavy fines for those who failed to meet these requirements. Influenced by the report of the earlier Reference Group on Welfare Reform headed by Patrick McClure, the 2005 Welfare to Work Bill also extended many of these requirements from the unemployed to new recipients of the Disability Support Pension and Parenting Payment (Billings, 2010; Mendes, 2008). These initiatives per se did not limit the basic entitlements of Australian income security recipients. However, from time to time, Coalition Government Ministers such as Peter Costello and Mal Brough raised the prospect of further obligations being placed on undeserving recipients (Mendes, 2008). These ideas came to fruition in June 2007 when the Coalition Government announced the establishment of the Northern Territory Emergency Response (NTER). The NTER was introduced as a result of a number of reports by governments and community bodies that documented widespread disadvantage, including abuse and violence towards women, 498 P. Mendes children, and other community members in remote Indigenous communities (Secretariat of National Aboriginal and Islander Child Care, 2008). The most influential study was the Little Children Are Sacred report, published by the Northern Territory Board of Inquiry into the Protection of Aboriginal Children from Sexual Abuse. The report found that child sexual abuse was serious, widespread, and often unreported. It urged that Aboriginal child sexual abuse in the Northern Territory be designated as an issue of urgent national significance by both the Australian and Northern Territory Governments, and that both governments undertake genuine consultation with Aboriginal people in developing service responses (Wild & Anderson, 2007). The NTER plan was implemented by an emergency response taskforce, including police and army personnel, and applied without any consultation to all people living in remote Northern Territory Indigenous communities. It included a range of measures to tackle alcohol abuse, improve school attendance, reform public housing arrangements, and quarantine 50% of all income support and family assistance payments to ensure payments were spent on food, school nutrition, rent, and other essential items. These measures required a suspension of the Racial Discrimination Act so that they could be applied exclusively to Indigenous Australians living in 73 prescribed communities, associated outstations, and 10 town camp regions of the Northern Territory (Hinkson, 2007). The CIM measure was loosely based on a report by Cape York Indigenous campaigner, Noel Pearson. That report, which has had a

significant influence on both Coalition and Labor Governments (Behrendt & McCausland, 2008), argued that welfare payments should be conditional, and based on meeting the following four obligations: that adults ensure that children maintain a 100% school attendance record; that adults prevent any child abuse or neglect; that adults not be involved in substance abuse, gambling, or family violence offences; and that adults adhere to conditions of tenancy in public housing (Pearson, 2007). The stated purpose of the CIM was to stop income security recipients in the prescribed communities from spending money on alcohol, cigarettes, pornography, or gambling. Instead, the quarantined income would be used solely for essential goods and the care of children (ACOSS, 2008). The Labor Government elected in November 2007 chose to continue the NTER including the CIM, but invited an independent Review Board to present a progress report on the intervention. The report of the review, which was released in October 2008, agreed that the intervention had made some positive changes in the Northern Territory in relation to improving housing, health, and education. However, it called for an end to the CIM system except where child protection or school attendance matters were involved, and urged a reinstatement of the Racial Discrimination Act (Australian Government, 2008). In May 2009, the Government released a discussion paper on the NTER, which cited various positive impacts of CIM in the Northern Territory. The paper argued that it had provided benefits for women and children, such as increased household expenditure on food and other essential items, less gambling and drinking, and Australian Social Work 499 reduced alcohol-fuelled violence. The Government announced that CIM would be extended for at least another 12 months (Australian Government, 2009a). The Rudd Government introduced a Basics Card in late 2008, which enabled participants to use their income-managed funds to purchase food and other essential items at authorised stores. The Card could not be used for alcohol, tobacco, pornography, or gambling (Central Australian Aboriginal Legal Aid Service [CAALAS], 2010). In addition, the Government announced a number of CIM trials for parents who abused or neglected their children, or who failed to ensure their school attendance. The Child Protection Pilot was introduced in selected Western Australia (WA) communities from November 2008 as part of the National Child Protection Framework. The Western Australian Department for Child Protection could request that Centrelink manage up to 70% of parents’ income support and family payments to ensure that the essential needs of children at risk are met (Centrelink, 2008). A separate school enrolment and attendance pilot was introduced in six Northern Territory communities and two metropolitan locations in January 2009. State education authorities notified Centrelink in cases where parents failed to take reasonable steps to ensure children attended school, and were unable to provide a valid excuse or special circumstances for not doing so. A social worker was then appointed by Centrelink to assist the parents to improve school attendance. Noncompliant parents who did not take reasonable steps to improve their children’s school attendance could have their payments suspended (Centrelink, 2011b).

The Gillard Government published a further sympathetic report in November 2009, based on consultations with Indigenous communities. This report identified improvements in spending on essential items, and reduced levels of ‘‘humbugging’’ (which is the intimidation of people to hand over welfare benefits) and associated involvement with drugs and alcohol and gambling. The Government announced that they would retain the CIM program, but also extend it as a nondiscriminatory measure to nonIndigenous welfare recipients in the Northern Territory (Australian Government, 2009b). These measures were included in the Social Security and other Legislation Amendment (Welfare Reform and Reinstatement of Racial Discrimina- tion Act) Bill 2009, which was passed in 2010. The stated aim of the Bill was to reduce individual and family hardship and deprivation, ensure payments were not spent on alcohol, gambling, tobacco, or pornography, eliminate harassment and abuse, and promote socially responsible behaviour, particularly regarding the care and education of children. The Bill applied CIM to four groups of income security recipients: disengaged young people aged 1524 years; the long-term unemployed who had received income security payments for more than two years; income security recipients deemed vulnerable by a Centrelink social worker as a result of poor financial management, family violence, mental health concerns, or other factors; and those individuals referred by child protection authorities. The Bill also permitted some existing CIM participants to switch to a voluntary income management scheme if they chose, and provided incentive payments to encourage participants in both compulsory and 500 P. Mendes voluntary schemes to save money. Another action was the reinstatement of the Racial Discrimination Act via amendments to the original NTER measures, and the restoration of appeal and review rights for participants (ACOSS, 2010a,b; Australian Government, 2011a). The Government justified these initiatives on the grounds that they would allegedly reduce welfare dependency, promote self-reliance and responsibility, and enhance the capacity of participants to effectively parent their children, learn work skills, and potentially attain employment (Macklin, 2010). From July 2012, a targeted model of CIM has been introduced for a 5-year trial in five new locations across Australia* one in Victoria (Shepparton), two in Queensland (Logan and Rockhampton), and one each in NSW (Bankstown) and South Australia (Playford) (Australian Government, 2011c). In addition, a 3-year welfare reform trial has been taking place in four Cape York communities in far north Queensland since July 2008, based on a partnership between the communities, the Australian Government, the Queensland Government, and the Cape York Institute for Policy and Leadership headed by Noel Pearson. The aim of the trial, scheduled to end in December 2011 (but possibly extended until January 2013) was to reestablish positive social norms and reduce passive welfare in the communities. The trial has established an independent statutory body called the Family Responsibilities Commission, which has the power to refer individuals* where concerns exist regarding child safety, school attendance, criminal or violent behaviour, and alcoholism*to support services or income management programs, or both. However, the programs differ from the Federal CIM in that they are voluntary, were developed via significant community consultations, and income management only applied as a last resort (Billings, 2010). Evaluations of the Cape York trial suggest some positive outcomes, including improved school attendance and lower levels of substance use and violence. However, reports caution that these changes are only tentative and inconsistent to date. In addition, broader agendas of the trial, such as enhanced social responsibility, are complex and difficult to measure via objective performance indicators (KPMG, 2010).

Arguments in Favour of Compulsory Income Management The respective Coalition and Labor Goverments have proposed a number of arguments in favour of CIM, which have also been supported by much of the mainstream media, including particularly the conservative Australian newspaper, and neoliberal think tanks such as the Centre for Independent Studies (Hudson, 2010). Many of these arguments seem to be both highly ambitious and ambiguous in their terminology. The original aim of CIM seemed to be to protect children from abuse or neglect, and women from financial harassment or humbugging and violence. An associated aim was to focus funds on essential household items such as food and clothing, and Australian Social Work 501 reduce or eliminate spending on substance use, gambling, and pornography. The Labor Government has been able to cite a number of government reports that suggest a positive association between the introduction of CIM and improvements in these areas. For example, a May 2009 report suggested that income management had succeeded in increasing the proportion of income spent on essential items such as food and clothing, and contributed to lower levels of gambling and drinking. The Government cited these findings as evidence that CIM was working to enhance the care of children (Australian Government, 2009a). Similarly, a November 2009 report presented evidence of greater spending on food, clothes, and school-related expenses, enhanced saving for large household items such as fridges and washing machines, less money spent on alcohol, gambling, and drugs, reduced levels of harassment for money, and greater capacity for household budgeting (Australian Government, 2009b). An online survey of Northern Territory Government business managers in February 2010 cited evidence of support for CIM within the 79 NT communities, and a reported decline in humbugging (Snow & Eichhorn, 2010). An October 2010 evaluation report on the WA child protection trial suggested improved financial management, greater spending on fresh food and essential household items, and a significant reduction by participants in substance abuse, violence, gambling, and humbugging (Orima Research, 2010; Social Policy Research Centre [SPRC], 2010). And a further November 2011 evaluation of the NTER presented evidence of links

between CIM and improved community safety, healthier children, less harassment for money, and reduced spending on gambling, cigarettes, and substance use (Depart- ment of Families, Housing, Community Services and Indigenous Affairs [FaHCSIA], 2011). However, two important qualifications remain concerning these outcomes. First, they may provide evidence of short-term gain, but pose serious questions about long-term sustainability. For example, how has CIM addressed the long-term addiction of individuals to substance use or gambling? Have CIM convenors enrolled participants with these problems in rehabilitation or counselling programs, and if so, where are the details? Equally, CIM has been accompanied by a number of other policy measures including alcohol and gambling restrictions, tighter standards for community store licensing to facilitate improved supplies of healthy food, an increased police presence that may deter drug dealers, and intensive case management of families (Australian Indigenous Doctors’ Association [AIDA], 2010). It is arguably difficult to assess the positive impact of CIM in isolation, given the likely significant influence of these associated measures. For example, financial management and budgeting workshops and counselling may have far more long-term impact on the capacity of individuals than CIM. Over time, the Government has suggested some broader outcomes of CIM regarding behavioural change including a reduction in welfare dependence, improved parenting skills, and increased capacity to participate in employment training and paid work. In February 2011, the Families Minister, Jenny Macklin, quoted data showing that CIM had enabled 1700 people to find work or apprenticeships and 502 P. Mendes improve their parenting skills as reflected in higher school attendance and health check/immunisation rates (Dunlevy, 2011). These arguments also appear problematic. Welfare dependency is arguably a nebulous and indeterminate psychological concept that cannot be tested in the real world. Rather, it assumes an ideal world in which anyone who wants work can find work at a living wage, and all citizens enjoy equal opportunities from the time of birth. In contrast, the real world is based on social and economic inclusion and exclusion, and fundamental inequities. It is contentious to suggest a direct correlation between CIM and improvements in parenting skills and work readiness independent of other supports provided. For example, child protection trials may inspire better care of children because participants are threatened with potential loss of custody. Similarly, new employment training and work experience opportunities may be provided for CIM participants that were not previously available. It also remains to be seen whether these improvements are sustainable, given that the personal problems that previously hindered good parenting or employment, or both, may be long-standing. In January 2011, the Government announced an independent evaluation of the CIM, to run until 2014. This evaluation will use a range of consultations including surveys of child protection staff, financial management service providers and retailers, and interviews and focus groups with CIM participants. Nevertheless, even this evaluation will arguably be limited by the fact that it does not include a control group of disadvantaged communities not involved in CIM, and will not consider separately the impact of broader support services introduced alongside CIM. The evaluators will also face significant challenges in addressing the unequal power relations involved for current CIM participants.

Concerns Regarding Compulsory Income Management Concerns regarding CIM have been expressed by a number of groups comprising many Indigenous organisations within and beyond the affected communities, including the National Congress of Australia’s First Peoples (2011), the Australian Indigenous Doctors Association (2010), and the Secretariat for National Aboriginal and Torres Strait Islander Child Care (2008), welfare lobby groups such as the Australian Council of Social Service (2011), human rights groups, and various lawyers and academics (Altman, 2010). (See summary in Cox, 2011c). It should be noted that Indigenous perspectives on political issues such as CIM and disadvantage more generally are diverse (Crawford, 2011), reflecting differences between the experiences of urban, rural, and remote communities and town camps, and in some cases between men and women in the same community. A small number of Indigenous groups do support CIM, but a larger number of Indigenous organisations are opposed (Cox, 2011c, p.38). The perspectives of some of those organisations are complex. For example, the Indigenous Doctors Association (2010) acknowledged that CIM may lead to improved nutrition, and more money being Australian Social Work 503 available for food and other necessities, but they argued that these positive impacts are overridden by a number of negative social, psychological, and health impacts, including shame and humiliation, anxiety associated with the use of the basics card, and general anger and disempowerment. They urged immediate cessation of the universal application of CIM, and only supported a targeted CIM in relation to proven cases of child abuse and neglect, and when used in combination with case management. They also recommended a voluntary option for income management, and that costs be met by the government, not by families. The common theme of all the groups opposed to CIM is their opposition to the blanket application of the measure to entire groups or communities. Their arguments cover a range of issues. One major concern suggests that CIM involves a fundament shift in the philosophical agenda of the Australian income security system from that of poverty reduction to social control. The existing system legally guarantees the right of claimants who meet certain eligibility criteria to receive government cash benefits accompanied by certain obligations, and spend their payments free of any externally imposed conditions or limits (ACOSS, 2010a; Western Australian Council of Social Service [WACOSS], 2011). However, the obligations imposed have become increas- ingly onerous in recent years. CIM seems to take this shift to conditional welfare even further by imposing an unprecedented restriction of individual freedom in an attempt to promote behavioural change. Centrelink is arguably being given judicial powers similar to those granted to Guardianship authorities in cases where people

assessed to have significant disabilities are unable to manage their personal or financial affairs. Yet these powers are being imposed on CIM participants without any individual assessment of their capacity (ACOSS, 2010b; Behrendt & McCausland, 2008). In addition, the paternalistic conditions imposed via CIM have resulted in a number of practical problems for participants irrespective of their level of personal responsibility. For example, there are only a limited choice of approved stores in which they can use their BasicsCard, which means they may be unable to purchase basic leisure items for their children such as show and cinema tickets, or arrange for vehicles to be repaired, or pay fines. A number of participants in consultations specifically complained that they could not take their children to the Darwin show (Australian Government, 2009b). Further, some reported experiences of shame and humiliation in shopping centres either due to being relegated to separate checkout queues as a result of the mode of their payment, or due to unsuccessful transactions resulting from an inability to check their Card account balance, or both. Others have lost or damaged their card, or forgotten their PIN number, or find it difficult to travel interstate (ACOSS, 2008; 2010b; AIDA, 2010; CAALAS, 2010; FaCHSIA, 2011). Another concern is that CIM is racially discriminatory in that it primarily targets Indigenous communities. This discrimination is now less direct than it was previously, given that the new legislation passed in 2010 complies with the Racial Discrimination Act, and CIM has been extended to non-Indigenous populations. However, there still appears to be ongoing discrimination given that CIM remains 504 P. Mendes primarily targeted at the Northern Territory, including its large Indigenous populations, despite the fact that the NT only contains 24 out of the 50 most disadvantaged postcodes in Australia. CIM arguably continues to involve a blanket stereotyping of all members of remote Indigenous communities as dysfunctional, irrespective of their individual capabilities and behaviour (ACOSS, 2008, 2010a,b; Australian Government, 2008;Cox,2011a,b,c; WACOSS, 2011). CIM also seems to reinforce a selective discrimination against poorer members of society. The underlying assumption is that income security recipients develop a culture of antisocial behaviour that separates them from the dominant values of mainstream society. However, there is little research evidence that people who are reliant on income support payments actually hold fundamentally different values and attitudes from the rest of the community (Murphy et al., 2011). In addition, no research has been completed that shows that irresponsible behaviours such as drinking and gambling are more prevalent among income support recipients than other community members. Many others in the community, including some very affluent business people and sports stars and others whose wealth is inherited or unearned, also engage in antisocial activities such as wholesale substance use, gambling, and reckless spending, but are rarely targeted for collective monitoring and public condemnation (Rowlingson & Connor, 2011). In addition, the evidence provided in favour of the effectiveness of the existing Australian CIM appears to be empirically weak, and based on the selective use of findings from government-commissioned consultations and

evaluation reports. The authors of the Australian Institute of Health and Welfare evaluation of CIM in the Northern Territory acknowledged that the evidence ranked ‘‘towards the bottom of an evidence hierarchy’’ (AIHW, 2010, p. vi). For example, there was no comparison group or baseline data by which to measure what the outcomes would have been for the affected communities if CIM had not been imposed, which meant the researchers had to rely on the opinions of various stakeholders directly involved in the CIM operation. Further, the effectiveness of income management independent of other measures introduced by the NTER was difficult to evaluate; and the participant interviews were limited by the small sample size (only 76 out of a possible 15,125, which is a much smaller sample than would be expected from a study that was expecting to generalise its findings, and derived from only 4 out of 73 affected communities) and method of selection, with no random selection involved (AIHW, 2010). Similarly, analyses of the evaluation of the WA child protection trial conducted by Orima Research questioned the relatively small sample (only 149 interviewees across two sites) and the absence of hard data demonstrating improved outcomes. Although the evaluation presented triangulated findings from a number of sources, including administrative data, quantitative-based client surveys from both compulsory and voluntary income management groups, online surveys of service providers, and focus groups and interviews with community leaders in the Kimberley area (Orima Research, 2010), it appears that conclusions were based primarily on the self- reporting of participants whose views may be skewed by their fear of losing their Australian Social Work 505 children into state care (Cox, 2010; WACOSS, 2011). Some independent studies of CIM, albeit with their own methodological limitations, have provided quite different findings from those highlighted by the government. For example, one study explored the impact of CIM on store sales in the Northern Territory, and found no evidence that CIM per se had enhanced the purchase of healthy food and fruit, or contributed to a decline in tobacco sales (Brimblecombe et al., 2010). A further objection is that CIM is disproportionately expensive because it requires the introduction of electronic payment systems, store licensing schemes, and regular user contact with government administrators. It has been estimated that the scheme will cost $405 million over five years for the Northern Territory alone. Critics have argued that these resources would be better employed in funding support programs that address the underlying causes of disadvantage (ACOSS, 2010a,b)

International Evidence A number of governments around the globe have introduced conditional welfare programs in an attempt to change the behaviour of disadvantaged groups. These programs typically consist of either punitive approaches, whereby undesirable behaviour such as gambling or substance abuse is penalised or, alternatively, rehabilitation approaches that reward desirable behaviour such as spending on nutritious food, health, and education. Some of the better- known programs include the Opportunity New York City Family Rewards initiative, the Self Sufficiency Project in Canada, and numerous services in Latin America (Rawlings & Rubio, 2005; SPRC, 2010). An analysis of existing programs by the Social Policy Research Centre (SPRC) for the Australian Government identified both strengths and limitations. The SPRC argued that conditional welfare programs have been effective in promoting improved health, education, and employment outcomes, but they also cautioned that most of these programs are relatively new, and hence the longer-term impacts are still to be determined. In addition, the cost-effectiveness of many programs remains uncertain, and conditional welfare needs to be accompanied by substantial investment in public education and health facilities to work (SPRC, 2010). It should also be noted that most overseas programs only target discretionary or additional payments, and unlike the Australian scheme, do not limit the freedom of recipients to spend core income security entitlements (ACOSS, 2008, 2010b; Behrendt & McCausland, 2008). Nevertheless, they do suggest that a combination of income management with increased social investment may be effective in promoting greater personal responsibility.

Specific Implications for Social Workers in Centrelink CIM has significant implications for social workers in Centrelink, given the lead role they have been allocated in assessing potential recipients for participation (Australian Government, 2011b). This challenge to advocate for and protect the rights and 506 P. Mendes self-determination of individual clients, while simultaneously adhering to the policies and procedures of the employing agency, is arguably nothing new for social workers. Previously, during the introduction of the 2006 Welfare to Work measures*which imposed tighter eligibility criteria on new Disability Support Pension and Parenting Payment applicants*Centrelink social workers used their professional discretion to effectively moderate the harsh impact of these policies. Their actions included individual case advocacy to ameliorate the impact of breaching policies, and the presentation of broader statistical evidence to senior managers within Centrelink and external trade union representatives (McDonald & Marston, 2006). Social workers in Centrelink should also aim to fulfil this dual professional and organisational role in regard to CIM. On an individual basis, they can be expected to apply the discretion that is arguably missing in the legislation by distinguishing between those clients who may benefit from involvement in CIM, and those whose personal circumstances and capacities do not warrant involvement (Australian Association of Social Workers [AASW], 2011). In addition, they should identify broader structural concerns arising from individual cases and feed these findings into appropriate policy and advocacy processes and debates. Ideally, they should consult with the National Coalition of Aboriginal and Torres Strait Islander Social Workers Association and other Indigenous organisations in order to ensure that the specific cultural needs, experiences, and voices of Indigenous clients are recognised and addressed in this assessment process (Crawford, 2011).

Towards Alternative Policy Solutions Few critics of CIM oppose all forms of income management. There is widespread consensus that voluntary income management can be effective when freely chosen by individuals and communities (as reflected, e.g., in the Cape York Institute model and the long-existing Centrepay service provided by Centrelink), rather than individuals in affected communities having to seek exemptions by demonstrating that they are responsible. There is also considerable support for targeted CIM that is directly applied to families involved with child protection authorities due to evidence of child abuse or neglect, or to encourage school attendance. Such initiatives may persuade dysfunctional parents to prioritise the needs of their children ahead of their own (ACOSS, 2010a; AIDA, 2010; Behrendt & McCausland, 2008; Billings, 2010; National Congress of Australia’s First Peoples, 2011). However, most commentators emphasise the need to accompany income management with a range of services and supports that address the underlying causes of disadvantage and community breakdown. Many CIM participants are likely to be vulnerable people susceptible to social isolation, family violence, poor health, including mental health problems, housing transience, limited literacy and English-language skills, substance abuse, and lack of personal problem-solving skills (Centrelink, 2011a). Effective interventions may include a range of intensive case management and therapeutic counselling, financial management and budgeting skills programs, family violence services, health including mental Australian Social Work 507 health clinics, parenting workshops, expanded child protection services, alcohol and drug rehabilitation services, and upgraded police and legal responses to humbugging. Of course, the introduction of these services may require significant new planning and investment, given the current absence of professional services in many remote communities (ACOSS, 2010b; AIDA, 2010; Orima Research, 2010; WACOSS, 2011; Wise, 2011). Other authors have drawn specific attention to community development interventions that have worked to enhance school attendance and retention rates for Indigenous children. These programs appear to be most effective when introduced as a result of ongoing consultations between schools and Indigenous parents and communities. These consultations should incorporate a recognition of the human rights and self-autonomy of Indigenous Australians and their communities (Behrendt & McCausland, 2008; National Congress of Australia’s First Peoples, 2012). There is also a need to address broader structural and systemic causes of social exclusion that refers to people and communities being denied the opportunity to participate in mainstream, social, economic, political, and cultural systems (Room, 1999). Causes include the low level of income security payments and lack of affordable housing, which push many recipients into poverty and associated family breakdown, the minimal education, training, and employment opportunities available in many communities, the limited access to healthy and affordable food, and the intergenerational trauma experienced by many Indigenous Australians. These issues do not only affect recipients of income security but may also impact on individuals and families in low-paid employment (ACOSS, 2010b; Cox, 2010; Secretariat of National Aboriginal and Islander Child Care [SNAICC], 2008).

Conclusion The CIM measures introduced in Australia are crisis intervention programs that target individual behavioural deficits as the symptoms of disadvantage, but do not appear to address the long-term causes of social exclusion such as lack of skills and opportunities. CIM contains a significant component of coercion directed exclusively at mainly Indigenous income security recipients. It bans spending on alcohol, cigarettes, and gambling even though these activities are legal in the broader community. It is difficult to see how such top-down and paternalistic measures will enhance individual self-reliance and strengths, or promote community autonomy. If anything, the CIM measures could further entrench passive reliance on welfare among the affected populations, many of whom may have already have experienced long-standing government intervention as wards of state or as participants in the youth and adult justice and mental health systems, or both. The continuation of CIM seems to be based on exaggerated claims of success by a government already committed to a particular course of policy action. It is very unlikely that CIM alone can persuade alcoholics and gamblers to instantaneously give 508 P. Mendes up their addictions, or bad parents to suddenly become good parents. And it is hard to judge from the available studies whether CIM has even worked in the short-term. There is a wealth of claims and counterclaims about success or failure matched by allegations of bias. A modified form of income management might play a useful role in addressing both individual and structural components of disadvantage, provided it was voluntary other than in exceptional circumstances based on individual assessment, combined with a range of social support services, and introduced via bottom-up community development strategies in partnership with Indigenous and other disadvantaged communities. Social workers within and beyond Centrelink could potentially play a valuable role in developing such a program, given their holistic emphasis on the interface between individuals and their environment.

Acknowledgement I am grateful to Dr Catherine Flynn for her comments on an earlier draft of this paper.

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