The Department of Social Services has revealed Indue, the company charged with the management of the Cashless Debit Card (CDC), has been afforded AU$26 million to expand the scheme into the Northern Territory and Cape York.
The contract, signed on March 9, brings the total amount pocketed by Indue since 2015 to AU$70 million.
The welfare quarantining system trial kicked off in 2016. It aims to govern how those in receipt of welfare spend their money, with the idea being to both prevent the sale of alcohol, cigarettes, and some gift cards and block the funds from being used on activities such as gambling.
Participants of the CDC trial have 80% their funds placed on a card, which is managed by Indue, with the remaining 20% to be paid into a bank account.
The Bill that allows trials of the card to go on for another two years across Bundaberg and Hervey Bay, the East Kimberley, Ceduna, and Goldfields regions and have it enter the Northern Territory and Cape York, affecting mostly Indigenous Australians, passed the Senate in December.
The CDC began its rollout this month in the NT and Cape York. There are currently over 23,000 Territorians who are on the Basics Card and any transitions to the more bank card-like solution are voluntary for those people. In Cape York, the CDC will replace the Basics Card.
“I think that a number of different mechanisms have indicated that in the communities where the Cashless Debit Card has been put in place, that it is providing positive results … people indicated they were drinking less, they were gambling less, that overall they were feeling that their well-being, their families had improved significantly,” Minister for Families and Social Services Anne Ruston said.
“The reports and the feedback we receive from community leaders in these sites was that they were very keen to continue.”
According to the department’s cashless welfare policy and technology branch manager Ben Peoples, the extra AU$26 million is for Indue to continue the CDC for two years in the four trial sites, as well as to expand it to the NT and Cape York. He said the contract does not include any shop fronts or face-to-face presence from Indue, but they do run online support and call centre services.
The AU$70 million is in addition to the AU$33 million Department of Social Services Secretary Kathryn Campbell said was currently being used by the government to roll the project out, which includes community support services in its scope.
AU$17.5 million has been allocated to the NT and Cape York.
The government in December 2019 kicked off a AU$3.4 million pilot of product-level blocking with tech vendor DXC Technology. The pilot was aimed specifically at assisting small businesses. Major retailers such as Woolworths, Coles, and Australia Post already automatically block certain product purchases.
There is also a CDC technology working group, which includes the likes of ANZ Bank, the Commonwealth Bank of Australia, National Australia Bank, and Westpac, as well as Coles, Woolworths, Metcash, Eftpos, and Australia Post.
“The working group was established to progress technology solutions to consider future options for the cashless debit card, it had a significant focus on expanding product-level blocking … and it also discussed options that could involve multiple different financial institutions issuing cashless debit cards and linked accounts,” Peoples said previously.
The group last met in November and instead of meeting monthly, it will now “meet as required”.
“The purpose of the working group was to progress technology solutions for the future to improve the delivery of the CDC,” Peoples said on Thursday. “And the focus has been on expanding product level blocking, which is about improving the way that cashless debit card restrictions are applied at merchants and also looking at the development of models to support multiple financial institutions to issue cashless debit cards.”
Peoples said there has been AU$3.4 million-worth of transactions that have been declined thanks to product-level blocking tech.