Income Management is a policy introduced by the Australian government in 2007 as part of the urgent measures for the Northern Territory. This consists of “quarantining” percentage of income support and family payments so that beneficiaries can only spend their subsidies on goods and services like food, education, housing, health services, clothing, etc. This program was implemented by Australia’s Centrelink. In 2010, a more sophisticated model of this income management policy was reintroduced by the Australian legislature. It has been known as the “new model of Income Management in the NT.” (Australian Social Policy Conference, 2011) Those who fall under this policy’s income scheme are given their “”basics card,” which is controled b Centrelink. This card is connected to an account into which half of all fortnightly welfare payments are paid. The basics card can just be consumed for the purposes stated above, basically food and household items.
At present, this social policy has been one of the most controversial policies in the country. While others view it as very prejudiced and paternalistic, others accept it as part of the welfare nature inherent to the Australian government. This paper shall look into this policy mainly as a social policy, with the greater consideration of Australia’s welfare state nature. It shall contextualize the said policy against its benefits and drawbacks and in Australia’s social, political and historical settings. This is particularly evaluated for the welfare of the refugees and the immigrants in the country.
Basically, this policy affects those who staying in the prescribed community during the time the policy was legalized or when it took effect. However, this policy can also be imposed by the government as they see it fit. For instance, when they see that it has not been used to carry out its intended purpose like educational priveleges, food and accommodation subsidies, etc. (Income Management, 2011)
Those who are covered under the income management policy are the disengaged youth, 15 to 24 years of age and have been receiving government subsidies such as newstart allowance, youth allowance, parenting allowances, and special benefits. It also covered those who are considered as long term welfare beneficiaries who have been receiving government subsidies mentioned above. Exemptions are also allowed by Centrelink, which also administers all the income management policies. (Cox, 2010)
Key Issues Related to the Policy
The major issue being hauled to the income management policy is its discriminatory and racist orientation. The said income management means that majority of the welfare card benefits is restricted or can only be spent for specifically the following – housing and rentals, food, health care services, and clothing. According to Robson (2011), this policy makes high level of discretion to the Australian government’s Centrelink to zero in the targeted communities with the said income management quotas.
Also, the basic implication of this income policy directly affects the refugees and immigrants because they may have some difficulty in explaining their living conditions in English. Hence, they will be more likely to be bracketed under income management. As it is, the income management policy generally affects the newly-arrived refugees. Even when they refugees and immigrants qualified for the welfare state benefits, they will be falling under the management scheme wherein their government subsidized income will be “managed.”
According to the Refugee Council of Australia, “many refugees and humanitarian entrants consumed a considerable time after arriving in Australia before they can speak English. They also take some hard time securing for themselves sustainable employment. (Robson, 2011) Hence, this policy is discriminatory and racist because it mostly affects the immigrants, the poor Australians, the aboriginal, and those who live in the marginal sector of the Australian society. (Robson, 2011) Hence, the policy also intervenes in the refugees and the immigrants’ economic paths towards financial and economic independence. (Ibid.)
Policy’s Evaluation in the Social, Political and Historical Context
In the present day’s social and political contexts, the income management policy can be viewed as a reflection of how the Australian government regard welfare. It is plain perfunctory function rather than rightfully giving it out since it is a welfare state. The welfare benefits are now very selective and considerably gives out a low level payment. Before people can get their benefits, they undergo stressful processes. (Ibid.) Since social seucirty is generally paid out as revenues, the Australian public has low level of support for welfare payments such those given to unemployed. This is reflective of the economic depression which makes people become more conscious of their income and how their tax is subsidized towards the poor and the marginalized.
The government has also been reforming their welfare programs. Welfare reform is also expanding. In 2006, it has shifted from the long term unemployed to the increasing population of disabled and single parents. For instance, there have been moves to reduce indigenous welfare recipients to parents whose children are studying. (Ibid.) It shows how the Australian government is considering to support those who are “deserving” than the others. Along with this consideration of those who deserves the help of their welfare government is the fundamental question of the citizenship and inherent rights. This is where the refugees and immigrant issues and concerns set in.
Even the Australian Law Reform Commission (2011) acknowledges the criticisms of their income management policy. It has been criticized that this policy does not promote long term improvement in the financial capacity and economic determination of the people. The policy also discourages the disclosures of family violence because this has been penalized by the income management schemes. The policy is also discriminatory against those who are mentally and physically disabled. Under this policy, families are not given rights to manage their money or their choices. (Ibid.)
Critical Evaluation of the Income Management Policy 706
The Australian government held various reasons for the income management policy. They consider it a wider policy program in order to end their being a welfare state. They want to discourage welfare because they relate the other social problems with it. This includes drugs and alcoholism, domestic violence, family problems, among others. They also reasoned that the wanted to promote independence among their people and self sufficiency.
The number one flaw is that they tied up the social upheavals to the income benefits of welfare. This is not the case. They linked the welfare benefits with people spending on alcohol, cigarettes and using the money for gambling instead of using it for making their lives better or ensuring the welfare of their families, especially their children. (Australian Council of Social Service, 2010)
Income management was intended to sway people to spend more on their basic necessities such as food, clothing, medicines, etc. However, it cannot be taken as an aggregate choice for people of various economic and class standing. The social choice theory espouses that individual preferences, interests and values can be aggregated into a collective whole for its individual members. (Oxford Dictionary of Philosophy, 2011) However, this very theory is contradicted since not all its presumptions about individuals are normative. It also evidences that the social imposition of conditions (such us prioritizing food and education among those under the income management scheme) on the assumption of benevolent human behavior is not effective for social welfare or other social reforms. (Lehtinen, 2011)
As mentioned above, one of the criticisms of this social policy is that it promotes the covering up of family affairs such as domestic violence in order to escape the income penalties imposed under the income management policy. Its automatic application to the wrong groups could stigmatize the general public about the normative behaviors which the Australian government purportedly wants to achieve.
There are weak evidences linking the income management policy with changed behaviors. While the Australian government states that the policy effectively increased the amount of money spent on basic necessities such as food and clothing, there is no strong evidence which links the policy to the very purpose for which it has been created. In short, the policy did not lead to any significant decrease in unemployment or in the long term beneficiaries on welfare because of overdue unemployment. It does not also showed evidences linking the reduction of alcohol, tobacco and gambling products consumption.
The Australian government was expecting that the vulnerable welfare reward beneficiaries will be positively influenced by the income management to prioritize their social and family responsibilities, manage their financial resources better, and develop themselves as independent and self sufficient individuals. With the help of the Centrelink Social Workers, those who are vulnerable to these scenarios or those with disabilities or financially harassed will be salvaged. However, this is not evidenced in the assessment studies done after the implementation of the policy. (Ibid.)
The policy is also discriminatory because the targeted people are the ones who really need their public resources to carry on with their decent living. These include the refugees and the immigrants. As being welcomed in the Australian soil, the must be supported by the services and resources and available.
Another fundamental weakness of this policy is that it was not backed by scientific studies before it was finally implemented. A transparent and purposive assessment process enhances the viability and the success of the policy or its new components. It will also increase its legitimacy amidst criticisms and dissent. However, the evaluation of the social policy happened after it has been fully implemented and not the other way around. (Evaluation Framework for New Income Management, 2010)
There was no baseline data. (Ibid.) The data collected after the income policy management was implemented is not reliable because there is no baseline data to compare it with and/or track the changes after the policy was set. As it was, the income management policy was already implemented in seventy three discrete communities. This took place in 2008 when the Northern territory was undergoing some rigid and fast changes as part of their Emergency Response. This made it impossible to collect baseline data which will validate the results and the new data gathered after the policy was rolled out.
Australian Council of Social Service. (June 2010). Compulsory Income Management: A Flawed Answer to a Complex Issue. Retrieved on October 31, 2011 from, http://docs.google.com/viewer?a=v&q=cache:KCa0hUXvrIgJ:www.acoss.org.au/images/uploads/ACOSS_analysis_income_management.pdf+australia+%2B+income+management+policy+%2B+evaluation&hl=tl&gl=ph&pid=bl&srcid=ADGEESilOZtXt2eFbHDxn3uRfk8p0M1NorlaqE3066FGKc3szQ9vQfAyR-oD_TPiMgocsZIAR9OMmM-16spI67d_9sLe7pn8HWB2atGAo_95YiPD7xkxqbmEQa8zEHoaOD1T8U88-_Hq&sig=AHIEtbQFSemFPOOo32KOBF3ZCE-ZAaX13A.
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