Evaluation of income management in the Northern Territory

18 Dec 2014

This is the final report of the independent evaluation of the “New Income Management” program which was introduced in the Northern Territory in late 2010 and involved restrictions on how people can spend their income support payments.  There is a large (380 page) detailed full report and a more concise (19 page) summary report.

New Income Management’ was introduced in late 2010 as a replacement for the program of income management that had been introduced in Indigenous communities in the Northern Territory as part of the Northern Territory Emergency Response in late 2007. The new program was designed to enable the restoration of the Racial Discrimination Act which had been suspended to allow the earlier program to be implemented.  Under the new program income management was applied on a compulsory basis in all locations in the Northern Territory to a wide range of income support recipients who had been in receipt of assistance for more than 3 months if aged under 25 years and more than a year if aged above.  When people were subject to the program half of their income support payment had to be spent in approved ways including on the BasicsCard. There were additional forms of targeted compulsory income management as well as a voluntary program.

This report is that of an independent evaluation which as commissioned by the Australian Government and undertaken by researchers from the Australian National University, the Australian Institute of Family Studies and the Social Policy Research Centre at UNSW Australia.  The evaluation adopted a mixed methods approach drawing upon extensive administrative data, a specific longitudinal survey and extensive qualitative data collection from people subject to the program, from those involved in its administration and those who worked with the population affected.  A key concern of the evaluation was to use this array of information, through a process of triangulation, to arrive at robust findings.

The evaluation noted that some 35,000 people have been subject to income management in the Northern Territory under New Income Management since its introduction in August 2010. In December 2013 18,300 people were income managed in the Northern Territory – 76.8 per cent of whom were on the main compulsory measures, 20.1 per cent were on Voluntary Income Management and the remaining 3.1 per cent were on the other targeted components The population affected by the program were mainly Indigenous Australians with 90.2 per cent of those being income managed in the Northern Territory being Indigenous. It is estimated that while 1.3 per cent of the non-Indigenous population aged 15 years and over living in the Northern Territory are subject to income management 34.0 per cent of the Indigenous population are.

There is a wide diversity of views about the program. Amongst Indigenous people on Compulsory Income Management 41.2 per cent want to get off the program and 45.4 per cent wish to remain on. For non-Indigenous people the proportions are 56.2 per cent and 31.4 per cent. 80.0 per cent of those on Voluntary Income Management wish to stay on.

The primary focus of the evaluation was on whether or not the program had been successful against its objectives. The evaluation reports that it could not find any substantive evidence of the program achieving significant change relative to its key policy objectives, including changing peoples’ behaviour. The evaluation found that, rather than building capacity and independence, for many the program has acted to make people more dependent on the welfare system.

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