Royal Commission into Mental Health Terms of Reference Consultation

Cashless Debt Card undermines the role of the market in serving consumer and community interests

Much of the Federal Government’s effort to address cost of living pressures involves making it easy to switch and exercise choice, for example, through the new Consumer Data Right. However, the Cashless Debit Card (CDC) undermines the role of the market in serving consumer and community interests, and instead places punitive measures on those that are forced to use the card in order to access their income support payments.

In our submission to Senate Community Affairs Legislation Committee on the Social Security (Administration) Amendment (Income Management to Cashless Debit Card Transition) Bill 2019, Consumer Action express our concern that the CDC unfairly places limits on freedom of choice and creates a secondary economy where welfare recipients end up spending more for goods and services by limiting their options to pay. The evidence also shows that the trials have been problematic and have resulted in adverse outcomes for individuals.

We strongly oppose the future expansion of the CDC and submits that the CDC be rolled back. Instead, investment should be redirected to evidence-based policies that effectively addresses harm caused by addiction and compulsive behaviours and promote financial inclusion in the mark.

You can read the full submission here [PDF].


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