By Denis Hay
The SmartCard replaced the Indue Card, but has anything changed? Discover the truth behind its restrictions, privatisation, and better welfare alternatives.
Picture this: Jane, a single mother from a rural town, is struggling to pay rent. She has just received her government support payment, but is unable to withdraw cash. Her landlord only accepts direct deposit or cash payments. She visits her local supermarket, but a sign on the counter reads: “No card payments under $10.” Frustrated, she wonders, “Wasn’t the Indue Card abolished? Why am I still facing these restrictions?”
Jane’s experience is far from unique. The Indue Cashless Debit Card (CDC) was officially scrapped in March 2023, yet its replacement – the SmartCard under Enhanced Income Management – works with identical restrictions. The government claims this new system is an improvement, but critics argue that it is simply a rebranded version of the Indue Card, designed to control welfare recipients rather than support them.
So, what has changed? And why is the government privatising the management of welfare payments instead of administering them directly? Let’s break it down.
The Indue Card was introduced under the claim that it would help welfare recipients better manage their finances by restricting purchases of alcohol, gambling, and cash withdrawals. However, it quickly became a symbol of financial oppression rather than empowerment. Key reasons for its abolition included:
• Widespread Public Backlash: Welfare recipients and advocacy groups strongly opposed the card, citing financial hardship and loss of autonomy.
• Lack of Evidence for Success: No data confirmed that restricting spending improved financial management.
• Human Rights Concerns: Many Indigenous communities were disproportionately affected, raising ethical and legal concerns.
• High Administrative Costs: The program cost taxpayers millions annually but did not deliver measurable benefits.
In response to this pressure, the government officially ended the Indue Card on March 5, 2023.
Just one day later, on March 6, 2023, the government launched the SmartCard under Enhanced Income Management.
• Marketed as an “improvement” over the Indue Card.
• Uses similar restrictions, preventing purchases of alcohol, gambling, and tobacco products.
• No cash withdrawals, limiting access to essential services that require cash payments.
• Managed by private financial institutions, rather than the government itself.
While the government insists this system provides better technology and flexibility, many recipients argue it is just the Indue Card under a new name.
No Cash Access – Welfare recipients are unable to withdraw money, making it difficult to pay for rent, second-hand items, or transport.
Targeting of Indigenous and Vulnerable Communities – Many Indigenous Australians are still disproportionately affected.
Limited Consumer Choice – Many small businesses do not accept the SmartCard due to transaction fees and technical issues.
Government Claims Reality for Welfare Recipients.
The SmartCard improves financial responsibility. Treats recipients as financially irresponsible adults.
It prevents fraud and financial abuse. No evidence suggests cashless welfare reduces fraud.
It is a modern, user-friendly system. The technology is difficult to use in rural areas with limited internet access.
Instead of running the welfare payment system internally, the government outsources the SmartCard to private corporations. This raises important questions:
• Who profits from these contracts?
• Why is public money being used to fund private financial institutions?
• Would a government-run system be more efficient and cost-effective?
• Private corporations (such as Indue) receive millions in government contracts.
• Government officials avoid direct accountability by outsourcing management.
• Welfare recipients continue to struggle under restrictive, inefficient policies.
Instead of forcing restrictive policies, the government could offer:
• Free financial literacy workshops for welfare recipients.
• Personalised budgeting help, rather than blanket restrictions.
• A publicly run, low-cost banking system for welfare recipients.
• Government-managed low-fee savings accounts and financial support services.
• Expanding emergency relief payments and crisis financial aid.
• Increasing Centrelink financial support staff for better accessibility.
The SmartCard is the Indue Card rebranded, with the same fundamental flaws. While the government insists it improves financial management, it continues to restrict autonomy, limit access to essential services, and help private corporations over welfare recipients.
Australia has better alternatives to support those on welfare. Investing in financial literacy, direct government-run banking, and universal basic services would empower citizens rather than control them.
Have you or someone you know struggled with the SmartCard or Indue Card system?
Share your story in the comments below.
Q: Is the SmartCard different from the Indue Card?
A: Not significantly. It has similar restrictions, no cash access, and is managed by private corporations.
Q: Why is the government outsourcing welfare payments?
A: Due to cost-cutting and corporate influence, but this reduces government accountability and transparency.
Q: What is a better alternative to the SmartCard?
A: A government-managed banking system, financial literacy programs, and expanded social support services.
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This article was originally published on Social Justice Australia
Also by Denis Hay: How Different Is Labor from the LNP on Important Issues?
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View Comments
There are a number of incorrect assertions in this piece. For a start Smartcard does not apply to everyone on welfare, it also does not quarantine entire payments. It is not nice to scare vulnerable people with incorrect information and it does not help your cause.
Hi Julie,
Thank you for your feedback. I appreciate your perspective and the opportunity to clarify key points.
The article does not claim that the SmartCard applies to everyone on welfare, but rather that it continues many of the same restrictions as the Indue Cashless Debit Card for those placed on Enhanced Income Management. While it’s true that not all welfare recipients are subject to the SmartCard, it is still a compulsory requirement for many individuals, particularly in regions where the earlier CDC was enforced.
Regarding payment quarantining, the SmartCard restricts some recipients’ payments from being withdrawn as cash or spent on certain goods, similar to its predecessor. While it does not quarantine an entire payment, the controlled part limits financial autonomy, particularly for those living in areas where cash transactions are necessary.
This article intends not to scare but to inform and spark discussion about the impacts of cashless welfare programs, particularly for those affected. If you have specific corrections with sources, I’d happily review them to ensure accuracy. Open dialogue is key to achieving meaningful reform.
Would you be open to sharing more details or pointing to official data that might further clarify these points?
Labor's so-called Smart Card IS just the LNP's oppressive Indue Card under a new name. Just like Labor's Workforce Australia is just the LNP's oppressive Jobactive scam under a new name. SSDD: Same Shit Different Day, as Stephen King once said.
This is an extremely poorly written article and is intended to scare, there are so many things wrong with this article that no matter the protestations from Denis Hay in his response to Julie McKenzie this article is misleading, and it would seem purposely so to generate fear
While the article does not say that the card applies to everyone on social security payments it does not inform the reader that the card is voluntary, it implies by omission that this smart card is exactly the same and the Cashless Debit Card and it is not.
It is true that it has similar restrictions to the Cashless Debit Card but what this article leaves out is that those who choose to have their social security payments managed by the smart card are well aware of the restrictions and although INDUE does manage the card on behalf of Services Australia the cost to the taxpayer is considerably less ($1,200.00 per annum per person) than the Cashless Debit Card ($10,000 per annum per person) cost.
This from Services Australia might be more informative.
"Government program management:
Services Australia manages the overall Income Management program, which includes determining who is eligible for a SmartCard and how much money can be loaded onto it.
Card issuing and operations:
Indue is responsible for physically issuing the SmartCard, processing transactions, and managing day-to-day cardholder queries.
Customer contact:
If you need assistance with your SmartCard, you would typically contact Services Australia's dedicated "SmartCard eIM hotline" to access support related to your account and usage, even though Indue technically manages the card"
When the Cashless Debit Card was in place Indue was the only avenue open to those on the card if they had queries.
I am surprised and disappointed that The AIM Network would print an article like this that seems to be purposely misleading.
It seems to me that this is a political statement against the ALP in that it is trying to paint the ALP smart card in the same light as the LNP Cashless Debit Card.
While Denis Hay's response to Julie McKenzie seeks to clarify some issues it would have been more appropriate for him to have included these clarification in the article rather than print an article which leaves out these "clarifications".
Influencers and grifters of the right, with many of their ageing voters' support, want to kick down on 'welfare' (Americanism) recipients; imagine the humiliation at check outs being told 'sorry no credit' (vs cash in pocket or their own bank card).
If this is the way ahead, then to be equitable all pensioners and taxpayers should have similar for their pensions and tax refunds, respectively?
Thank you, Patricia, for your comment. I appreciate your perspective and the opportunity to clarify key points.
First, the article does not claim that the SmartCard is the same as the Indue Cashless Debit Card but rather highlights the similarities in restrictions, management, and concerns raised by welfare recipients. While it’s true that the SmartCard is voluntary for new participants, it is still compulsory for many who were transitioned from the previous system, particularly in regions where the Cashless Debit Card was enforced. This is a critical point that affects thousands of Australians.
About the cost of the program, you are correct that the SmartCard’s reported administrative costs are significantly lower than the previous CDC program. However, this does not change the fundamental issues surrounding financial autonomy, lack of flexibility in spending, and the continued outsourcing of welfare management to a private financial institution. The government’s choice to maintain a privatised model rather than administering the system directly through Services Australia raises questions about transparency and efficiency in welfare management.
This article's intention is not to mislead or generate fear, but to inform and encourage critical discussion on the broader implications of cashless welfare programs. If you believe specific corrections should be made, I welcome constructive dialogue and credible sources to ensure the most accurate information is provided.
If you have specific concerns, I am open to discussing them. I do my best to ensure that my articles are balanced and factual.
I am very disappointed that you are doubling down on "both sides are the same". You must be in a privileged position to believe that. The liberal party used the indue card and robodebt to torture the vulnerable - the cruelty is the point. This version of the smart card was clearly requested by certain recipients (and their version is 50/50 cash) see Noel Pearson for further information. You havent done any research, or you are just another purveyor of disinformation for your own political reasons. This article should be pulled because of its inaccuracies.
Julie, Denis did respond to you earlier with:
“If you have specific corrections with sources, I’d happily review them to ensure accuracy. Open dialogue is key to achieving meaningful reform.
Would you be open to sharing more details or pointing to official data that might further clarify these points?”
You did not take up the offer.
Julie,
Thank you for your comment. I appreciate your perspective and the opportunity to clarify key points.
Clarifying the Article's Intent
The article does not argue that "both sides are the same". Still, it examines the similarities between the SmartCard and the Indue Cashless Debit Card (CDC) concerning spending restrictions, limited autonomy, and the continued outsourcing of welfare management to private companies like Indue.
Voluntary vs. Compulsory Participation
The SmartCard is indeed voluntary for new participants. However, many individuals were automatically transitioned from the CDC to the SmartCard, particularly in regions like the Northern Territory and Cape York. This transition means that participation was not optional for these recipients. The Department of Social Services notes that existing Income Management participants can move to the enhanced Income Management program. Still, they cannot revert to the earlier program once they do. Ref: https://www.dss.gov.au/income-management/enhanced-income-management-program?utm_source=chatgpt.com
Noel Pearson's Perspective
Indigenous leader Noel Pearson is a proponent of income management in specific contexts, particularly within the Cape York region. He has advocated for tailored approaches that address community-specific issues. However, it's essential to recognise that support for such programs varies among Indigenous communities and leaders. While some see benefits, others raise concerns about autonomy and potential stigmatisation. Ref: https://insidestory.org.au/price-and-pearson-uneasy-allies/?utm_source=chatgpt.com
Addressing Allegations of Disinformation
The article intends not to misinform but to highlight ongoing concerns about the SmartCard system. These concerns include the privatisation of welfare management and the potential financial hardships caused by restricted payments. For instance, the Australian National Audit Office (ANAO) has reported on issues related to the transition arrangements for the Cashless Debit Card, including documentation and oversight challenges. Ref: https://www.anao.gov.au/sites/default/files/2024-06/Auditor-General_Report_2023-24_48.pdf?utm_source=chatgpt.com
Invitation for Further Discussion
If you have more sources or insights that provide a different perspective, I welcome the opportunity to review them. Open dialogue is essential for correct and comprehensive discussions on such critical topics.
in such discussions about ‘smart’ ‘electronic’ cards there is always a tendency to overlook the reason why these cards are so avidly promoted. Electronic transactions permit information gathering. Lots and lots of seemingly insignificant facts about the user’s choice of products are gathered and with the aid of modern computers this data can and is used to build extremely accurate profiles of individuals without them even being aware of it.
Do you recall how once many years ago if you went to a checkout you were always asked if you collected frequent flyer reward points? The reason was to supply data collectors with information about your spending habits. What goes into your shopping basket every week, how much of this and how much of that, and what do these purchase reveal about your personality. Back in the late 20th century marketing people were extremely frustrated at the lack of customer information they could glean from demographics. All that told them was people’s capacity to pay and their age and location which left a lot of guess work as to their spending tendencies. They wanted ‘psychographics’, information that would allow them to target their marketing strategies more effectively. Frequent flyer and other reward schemes allowed limited gathering of information about what people were actually spending their money on.
Then along came the internet and smart phones, and legislation allowing companies to collect and sell meta data. The social network quickly became a billion dollar industry as it electronically took over the data mining industry and checkout staff stopped the ritual of asking customers if they collected frequent flyer points.
Zuckerberg’s sleazy invitation to college students to rate the ‘hotness’ of female students soon morphed into FaceBook, the world leader in meta data mining and the subsequent manipulation of its users. Alerted by Facebook’s manipulation experiments in providing some of their users with ‘negative’ news and some with ‘positive’ news to see how the different groups reacted, University studies revealed that just 65 clicks on Facebook provided sufficient information about the user to make extremely accurate predictions about the user’s political, religious and sexual preferences. They could actually predict a user’s likes and dislikes more accurately than the users’ spouses. Computers were now powerful enough to keep track of so much individual preferences and behaviour of billions of people without having to actually identity them, allowing them plausible deniability that they were infringing on people’s privacy, even though they knew where all these unidentified people lived and which electorates they voted in.
Then a profiling company called Cambridge Analytica came along and purchased some of the data that Facebook mines and sells and used the very willing social network platform to target and restrict their advertising budget on individual US voters identified as susceptible to manipulation with very accurately personalised tailored advertising designed to persuade them who to vote for or to deter them from voting at all. And thus Donald Trump against all common sense was elected President of the United States. Cambridge Analytica admitted all this openly, but the US authorities felt it was more expedient to falsely blame Russia instead of alerting the public to take this threat of electoral manipulation from the private sector seriously. After all to them mass profiling refined from data mining is a useful tool to maintain authority over the masses as well as to make masses of money for private enterprise.
Likewise in discussions like this article about electronic card transactions which allow the personal spending habits of card holders to be recorded and enable individual profiling on a mass scale, the danger of private sector and government manipulation of politic attitudes tends to be given no consideration at all.