Income Management an expensive, radical experiment


The report highlighted the gaps in knowledge that undermine current assessment about Income Management. Image: Getty

Inadequate evidence on the effectiveness of Income Management undermines the Federal Government's compulsory scheme, a Monash University report has concluded.

The report, targeting the Income Management Trial in Greater Shepparton, examined the official evaluations of Income Management, which are used by the Australian Government to justify expanded programs.

Led by Associate Professor Philip Mendes, Director of the Social Inclusion and Social Policy Research Unit in the Department of Social Work, the study proposed a much broader approach to assessing whether Income Management was improving the lives of the disadvantaged.

Commissioned by Shepparton community service agencies Berry Street and FamilyCare, the report highlighted the gaps in knowledge that undermine current assessment about Income Management.

Recommendations that could form the basis of alternative evaluation framework included examining the choices given to Income Management participants and how key issues of structural disadvantage, such as financial poverty and inadequate housing, have been addressed within Income Management.

“Top-down policies such as Income Management imposed on local communities are not likely to provide an effective solution to complex social disadvantage that has both individual and structural causes,” Associate Professor Mendes said.

“Governments should apply a community development approach that involves working with local communities to identify the causes of problems and potential solutions.

“We recommend an alternative evaluation model, which would arguably provide a better measure of whether or not Income Management is improving the lives of the chronically disadvantaged.”

FamilyCare CEO David Tennant recognised the financial challenges involved in living on a low income. “We believe the best way to produce positive and sustainable change is to help people take control of their own situation,” Mr Tennant said.

“Compulsory Income Management has the potential to undermine confidence and personal resilience.”

Income Management sees Centrelink payments quarantined for spending on essential items only.

The controversial budgeting program was expanded beyond the Northern Territory in July 2012 to five new trial sites, including Greater Shepparton in Victoria.