The Australian Government is committed to reforming the welfare and family assistance payment system to foster responsibility and to provide a platform for people to move out of welfare dependency.
Governments have a responsibility, particularly in relation to vulnerable and at risk citizens, to ensure income support payments are beneficial and contribute to individuals' well-being. The Government believes that the first call on these payments should be life essentials and the interests of children.
The Government has been progressively developing a national reform agenda in relation to welfare recipients in disadvantaged regions which extends beyond the Indigenous policy domain. The Government has implemented the following measures:
Each measure uses a combination of different tools to achieve its goals, including income management or increased conditionality on the receipt of income support.
In the 2011-12 Budget, the Australian Government announced the extension of income management to five new sites from 1 July 2012 as part of the Building Australia's Future Workforce package. The initiatives in the package are aimed at assisting vulnerable families and children, and enhancing opportunities for people to enter or return to the workforce. Fact sheets providing further information on the Government's Building Australia's Future Workforce package can be found on the Australian Government Department of Families, Housing, Community Services and Indigenous Affairs website, and the Australian Government Department of Education, Employment and Workplace Relations website.
Income Management
Income management works by ensuring a percentage of income support and family assistance payments are directed toward necessities including food, housing, utilities, clothing and medical care. Income managed funds cannot be spent on excluded goods, including alcohol, home brew kits, home brew concentrates, tobacco products, pornographic material and gambling goods and activities. There is no restriction on use of the proportion of a person's payments which is not income managed.
Income management does not reduce the total amount of payment an individual receives from Centrelink. It only changes the way in which individuals receive a proportion of their payments. The person receives the balance of their payments in the usual way.
Income management, supported by appropriate Financial Management Support Services, aims to:
- reduce the amount of funds available to be spent on excluded goods, including alcohol, home brew kits, home brew concentrates, tobacco products, pornographic material and gambling goods and activities;
- ensure that priority needs of the individual, children and their partners are met;
- strengthen participants' financial capability and skills to reduce risk of hardship and crisis;
- promote socially responsible behaviour, particularly in relation to children; and
- provide stability to enable disadvantaged people to better engage with the community, employment and education.
Income management is currently operating in metropolitan Perth and the Kimberley region in Western Australia, across the Northern Territory, and in parts of Queensland under Cape York Welfare Reform. In the 2011-12 Budget, the Government made a commitment to implement income management from 1 July 2012 in the Local Government Areas (LGAs) of:
More information on income management in these five locations is available here.