Minister Macklin’s response to the latest evidence that Income Management doesn’t work, from the newly released Menzies Health Centre study, is only the latest example of anti-evidence based decisions in the welfare system. Jumbunna, the UTS Indigenous research unit, released a report last week summarising the earlier evidence for and against the proposed changes. Using the reports the Government claims support their policies and others they do not quote, the report shows that there is little hard evidence and even less support for their proposed changes. Of all the many major welfare agencies that put their views to the Senate Inquiry NONE supported the current proposal.

The MJA report itself finishes with:

‘The government’s aim in introducing income management is to ensure that people receiving welfare payments use this money in a government-prescribed “socially responsible” way, and in a way that makes money available to “feed, clothe, house and provide for the education of their children”. Our findings suggest that income management may not be associated with healthier food and drink purchases, and may be having no effect on tobacco sales’. MJA 2010; 192: 549–554

These findings suggest that, without an actual increase in income as occurred with the government stimulus payment, income management may not affect people’s spending overall. The findings challenge a central tenet of income management — that people’s spending habits will be modified in a positive way with mandatory restrictions on expenditure alone. These findings do not support official government reports of improved healthy food and drink purchases in association with income management.15,16 In 2009, of 66 store operators interviewed by the Australian Government.
The Government response yesterday was incredibly trivialising and dismissive, as shown in this media release from Macklin’s office which starts with:

The Australian Government is requesting an urgent report from key departments on policy options to help reduce the consumption of high sugar drinks in remote communities. A new study from the Menzies School of Health Research has highlighted the need to lower the consumption of high sugar drinks in remote Indigenous Northern Territory communities.

Then later it states:

The Government welcomes the Menzies survey of ten Arnhem Land Progress Association (ALPA) stores. The detailed analysis and findings from the Menzies survey are not inconsistent with the findings in the Government’s 2009 Post Licensing Monitoring Report, and do not support a conclusion across all communities that the Northern Territory Emergency Response has had limited impact.

This was reported on the News website as:

‘THE Federal Government will look at new ways to cut down soft drink consumption in remote Northern Territory communities.

This study should be taken together with the Australian Indigenous Doctors findings about psychological harm of being shamed by loss of control under compulsory Income Management. The SMH today quotes the president of the Australian Indigenous Doctors Association, Peter O’Mara, as saying there were concerns the intervention was doing ”more harm than good” and income management was one of the chief problems.

Despite the weight of data, the government is determined to continue this deeply flawed program. The Legislation is in front of the Senate, without any amendments, including to a poorly designed re-instatement of the Racial Discrimination Act.

Macklin continues to claim: Income management is an important reform to fight passive welfare and ensure more money goes to food, clothes and rent and less money goes to buying alcohol and to gambling. This claims clearly conflicts with the last lines of the MJA article abstract:

Conclusion: Income management independent of the government stimulus payment appears to have had no beneficial effect on tobacco and cigarette sales, soft drink or fruit and vegetable sales.

There is wider reporting on this study in the Croakey Blog, However, the responses seemed to warrant this separate coverage.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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