Some findings from the evaluation of Income Management in the Northern Territory Rob Bray Research School of Economics ANU
2 Structure The evaluation of income management What income management is What the evaluation found The next steps
3 Evaluation of NIM Consortium SPRC, ANU, AIFS First report published in November 2012 Bray (ANU) Gray (ANU) Hand (AIFS) Bradbury (SPRC) Eastman (SPRC) Katz (SPRC) Detailed evaluation framework Multi-stage to 2014
4 The evaluation first report Data for first stage Administrative DHS unit record files Quant & Qual Surveys of intermediaries, DHS, etc Quant & Qual Surveys of people on IM 818 in NT and 305 in contrast sites Urban and selected communities, over sampling of non-indigenous Designed to be longitudinal
5 What is income management Quarantining 50% of income support and family payments Quarantined money to be spent on basics Not alcohol, tobacco, porn, gambling Money is: Allocated to a BasicsCard Payments on behalf of the person Payments to merchants for specific purchases Voluntary: $250 every 6 months
6 Basics card Debit card which can be used at approved merchants
7 Introduced as part of NTER Following the Little Children are Sacred Report September 2007 73 prescribed communities All income support recipients Part of a wider set of interventions Required suspension of parts of the Racial Discrimination Act
What is a prescribed community? 8
9 New Income Management Introduced August 2010 Applied to all of the NT Restoration of RDA Essentially Age Pensioners and DSP off Compulsory for others on basis of duration Voluntary, Vulnerable and Child Protection Scope for exemptions Supporting initiatives matched savings & money management
10 Other Income Management Initiatives Voluntary / Child Protection / Vulnerable Placed based (Playford Shepparton Bankstown Logan Rockhampton) WA Laverton, Ngaanyatjarra, Kiwirrkurra APY lands Voluntary & Child protection WA: metropolitan Perth & Kimberly Cape York Family Responsibilities Commission 60-75% 3-6 months & option to apply for voluntary
11 Legislative objectives Reduce immediate hardship by ensuring payments directed at meeting priority needs Give support to budgeting Reduce spending on alcohol, tobacco, porn & gambling Reduce risk of harassment Encourage socially responsible behaviour Improve level of protection to welfare recipients
12 Larger vision income management lays the foundations for pathways to economic and social participation through helping to stabilise household budgeting that assists people to meet the basic needs of life. Policy Statement Landmark Reform to the Welfare System, Reinstatement of the Racial Discrimination Act and Strengthening of the Northern Territory Emergency Response 2009
13 What are the mechanisms? ½ money quarantined from alcohol and tobacco Basics card as commitment device? For food Circuit breaker on obligations Low cost banking Knowledge of financial position? Interview with Centrelink on allocations Referral to money management training Ability to gain exemption as incentive Habitualisation vs stabilisation
14 Key stats (Audit Report) As at 30 June 2012 17,600 subject to IM in the Northern Territory Compulsory 13,300 Voluntary 4,050 Child Protection - 50 Vulnerable - 140 $95-110 million per annum $5,000 per person per year
15 Who is on IM 91% are Indigenous Indigenous account for 71% of income support recipients (under APE) 61% women (63% compulsory, 56% voluntary) 50% aged under 30 years 11% of Age Pensioners 70+% of Newstart, PPP & Youth Allowance 60% of PPS 18% couples with kids, 18% sole parents, 25% couples no kids & 40% singles
16 Transition from NTER (October 2011) 16,500 were subject to NTER IM 2,550 no longer on income support 13,950 balance 7,300 compulsory (52%) 3,700 voluntary (27%) 200 other (1%) 2,700 not IM (19%)
17 NIM Child protection and vulnerable Child protection: Financial management not seen as key issue Not worth going from 50-70% Risk of rupture of relationship Vulnerable Very small potentially squeezed out? 97% Indigenous Government has made policy response
BasicsCard Mixed responses in part related to location More positive in remote and negative in urban Issue of security cited by many In remote free banking service But could do more re balance checking Cost was high if using mobiles In urban lack of acceptance of cards especially markets Difficulty in making some large payments Has not eliminated gambling etc. 18
19 Money management Money management/financial counselling appears to be valued Immediate demand though is for short-term assistance Approved money management courses and matched savings not successful Very low take-up Not well pitched Centrelink staff did not see value in referring
20 Did IM make things better for family Proportion of respondents (%) 80 70 60 50 40 30 20 10 0 Female Male Female Male Female Male Indigenous CIM Indigenous VIM Non-Indigenous CIM Made things better Made no difference Made things worse
21 How often to people feel Discriminated against Not fair Non-Indigenous Compulsory Indigenous Voluntary Indigenous Compulsory Non-Indigenous Compulsory Indigenous Voluntary Indigenous Compulsory All the time Most of the time Sometimes Hardly ever Never 0% 20% 40% 60% 80% 100%
22 Control over money 60 Proportion of Respondents (%) 50 40 30 20 10 0 Female Male Female Male Female Male Indigenous Compulsory Indigenous Voluntary Non Indigenous Voluntary More control now About the same Less control now
23 Aim for IM 80 Proportion of respondents (%) 70 60 50 40 30 20 10 0 Female Male Female Male Female Male Indigenous Compulsory Indigenous Voluntary Non-Indigenous Compulsory Stay on income management Not sure Get off income management
Perceived outcomes for children Balance of improvement less poorer outcome (%) 70 60 50 40 30 20 10 0-10 -20 Healthier More food Safer Better school attendance Happier Cultural activities Indigenous Compulsory NTER Indigenous Voluntary NTER Indigenous Compulsory non-nter 24
25 Sufficient money for food - change 60% Average Improvement 50% 40% 30% 20% 10% 0% -10% -20% Indigenous CIM Indigenous VIM Non-Indig. CIM Reference Indig. Ref. Non-Indig. Perceived Reported
26 Model results Frequency of feeling Relative to control pop. Coefficents βstdy Indig. CIM NTER Indig. CIM non-nter Indig. VIM NTER Discriminated against 0.547 ** 0.440 ** 0.532 ** Embarrassed 0.632 ** 0.526 ** 0.348 Not fair 0.520 ** 0.529 ** 0.247 In control of life -0.374 * -0.795 ** -0.171 Better for self and family -0.206-0.567 ** -0.003 In control of money -0.362 * -0.828 ** -0.227 Not worried -0.102-0.248 * -0.124 Safer -0.252-0.727 ** -0.124
27 Model results Perception of change Indig. CIM NTER Indig. CIM non-nter Indig. VIM NTER Managing your money 0.128-0.393 ** 0.221 Saving money 0.218-0.295 * 0.368 * Having enough food 0.534 ** 0.312 ** 0.629 ** Knowing how much money 0.329 * -0.210 0.341 Looking after family obligations 0.171-0.173 0.272
28 Model results change in experiences Coded so that +ive is an improvement Indig. CIM NTER Indig. CIM non-nter Indig. VIM NTER Ran out of money for food -0.233-0.215-0.281 Ran out of money for clothing -0.132-0.174-0.162 Ran out of money for medicine -0.214-0.185-0.101 Rent on time -0.309-0.302 * -0.264 Bond -0.349-0.276-0.003 Utilities -0.011-0.012 0.060 Difficulties because gave 0.495 ** 0.209 0.389 * Asked -0.141-0.014-0.189 Emergency Relief 0.035-0.005 0.041 Travel -0.191-0.278 * -0.325 School activities -0.338-0.006-0.224 Survey participants (d) 244 168 128
29 Reason for seeking exemption 90 80 70 60 50 40 30 20 10 0 Control of money Stigma and shame Get rights back Have freedom to choose Cash purchase cheaper Indigenous Non-Indigenous
30 Exemptions from IM Non - Indigenous Indigenous Apply Applications successful 48.7% 13.2% 79.8% 36.5% Exempt 38.8% 4.8%
31 First Evaluation Report Conclusion Diverse impacts Can benefit some Applied to many who neither need nor benefit Incentives/supports not effective Means of control not building behaviours People likely to remain on for a long time
32 Next steps Final report next June Use more administrative data on outcomes including alcohol and tobacco sales Specific studies vulnerable, child protection Understanding: Motivations of those on voluntary The lived experience of IM As well as second stage of participant survey
33 Evaluating New Income Management in the Northern Territory: First Evaluation Report http://www.fahcsia.gov.au/our-responsibilities/families-and-children/programsservices/income-management/evaluating-new-income-management-in-thenorthern-territory-first-evaluation-report Audit Report: Administration of New Income Management in the Northern Territory http://www.anao.gov.au/publications/audit-reports/2012-2013/administrationof-new-income-management-in-the-northern-territory/auditsummary?sc_camp=f27966d3337f4e0c83e730c230b4ecd4