CatalystPaper3_IncomeSecurity_Total_Web

Spotlight on economic abuse
Catalyst Paper 3:
Income security
and economic abuse
Primary researcher: Fiona Macdonald
Project team: Tanya Corrie, Kath Deakin, Sue Fraser, Karen Hucks,
Emily Jackson, Kathy Landvogt, Magdalena McGuire
© Good Shepherd Youth & Family Service and Kildonan UnitingCare
November 2012

This paper is one of a series of six catalyst papers written for the Spotlight on Economic
Abuse Project, a joint initiative of Good Shepherd Youth & Family Service and Kildonan
UnitingCare. Both organisations provide services to some of the most vulnerable people in
our community. These services include family violence intervention programs, financial
counselling and financial inclusion initiatives such as financial literacy education and
microfinance. The Spotlight on Economic Abuse Project emerged from Good Shepherd
and Kildonan shared concerns about the impacts of economic abuse on people accessing
their services, with women and children most often affected.
Spotlight on Economic Abuse publications
Catalyst Papers
Paper 1: An overview of economic abuse
Paper 2: Credit, debt and economic abuse
Paper 3: Income security and economic abuse
Paper 4: Financial capability and economic abuse
Paper 5: Child support and economic abuse
Paper 6: Community sector collaboration and economic abuse
Fact Sheet
Fact sheet about economic abuse
Literature and policy review
Macdonald, Fiona Spotlight on Economic Abuse: a Literature and Policy Review
(Good Shepherd Youth & Family Service and Kildonan UnitingCare, 2012)
This project was made possible through the generous support of the SHARE Community
Appeal; the Alfred Felton Bequest, administered by ANZ Trustees; and the Victorian
Women’s Benevolent Trust and the Grosvenor Foundation, administered by Equity Trustees.
Kildonan UnitingCare
www.kildonan.unitingcare.org.au
Sue Fraser, Senior Advocacy Manager
sfraser@kildonan.org.au
Good Shepherd Youth & Family Service
www.goodshepvic.org.au
Kathy Landvogt, Social Policy & Research Unit Manager
klandvogt@goodshepvic.org.au

Catalyst Paper 3: Income security and economic abuse
How can we build on current policy and practice to enable women to
gain long-term economic security following economic abuse?
The purpose of this paper is to prompt discussion about the ways in which the
income support system can respond effectively to abuse. The paper focuses on how
we can build on recent recommendations made by the Australian Law Reform
Commission (ALRC) for changes to policy and practice to prevent abuse and lessen
its impacts. The companion paper, ‘An Overview of Economic Abuse’, provides an
overview of economic abuse and its impacts.
ECONOMIC ABUSE AND ITS IMPACTS
Economic abuse is a form of domestic and
family violence. It involves behaviours that
negatively affect a person’s finances and
undermine their efforts to become
economically independent (Weaver et al.
2009). Economic abuse has only recently
been included in family violence laws in
Australia. Public awareness and
understanding of this form of abuse and its
impacts is poor (VicHealth 2010; McGregor
2009).
Domestic and family violence can have
significant negative consequences for
women’s economic wellbeing. They are likely
to lead to financial hardship. Potentially, they
can have a range of negative consequences
for women’s health, housing, employment,
interpersonal relationships and parenting.
Economic abuse can also adversely impact
on children’s wellbeing. Alone or in
combination with other forms of domestic
violence, economic abuse can affect
women’s ability to find safe, affordable and
appropriate accommodation, buy basic
household necessities, care for children, gain
financial stability and become economically
secure in the long-term.
Economic abuse is a complex issue. Along
with other forms of domestic and family
violence, this abuse is often not identified
until after women leave relationships. Having
experienced economic abuse, women may
have few – if any – financial resources to
draw on. Leaving a relationship may be a
time of crisis in which women are dealing
with multiple issues. In addition, women may
incur additional financial costs for items such
as health services, housing and legal issues
associated with the violence, and separation
and parenting arrangements.
Effective income support can be critical
Following economic abuse and domestic and
family violence, some women may need to
rely on the social security system in the
short-term. Others may need to access the
social security system for a longer period due
to the lasting impacts of violence. In either
case, it is crucial for the social security
system to provide women with a real safety
net that offers them financial independence.
Indeed, for some women, having access to
financial resources through the social
security system may be a factor that enables
them to leave a relationship in which there is
violence.
Catalyst Paper 3: Income security and economic abuse November 2012 1

Assistance available through the social security system
Women who experience domestic and family violence may require access to income support payments at
various points in time. For example, women may need access to income support payments when they are
living in a relationship in which there is violence, when making the decision to leave a relationship, or when
seeking safety after escaping violence.
Women may seek access to various types of assistance provided through Centrelink. The main income
support payments provided by Centrelink include the Parenting Payment, Newstart Allowance, Disability
Support Payment and Youth Allowance. Other relevant payments are Special Benefits (which may be paid
to people experiencing financial hardship who are not eligible for other forms of income support), Crisis
Payments (which are one-off payments that may be paid to someone in extreme or difficult circumstances,
including domestic and family violence) and Rent Assistance. There are also payment arrangements that
can assist people who are experiencing violence, including weekly instead of fortnightly payments, advance
payments and temporary exemptions from participation requirements attached to payments (such as the
requirement to search for a job).
However, recent research and submissions
to public inquiries have raised questions
about the effectiveness of the social security
system as a positive support for women who
have experienced domestic and family
violence. These include concerns that
payments are inadequate, that there are
barriers to accessing assistance, and that
some women who are in need are not eligible
for assistance. In addition, economic abuse
may be perpetrated through the income
support system with devastating
consequences for women. This paper
focuses on some of these issues, and
considers how well the social security system
responds to the needs of women who have
experienced violence.
ARE INCOME SUPPORT PAYMENTS
ADEQUATE?
The low levels of income support payments
mean that people who rely on these
payments are among the poorest in the
Australian community (Whiteford 2012).
Financial hardship is likely to be a problem
for many people who rely on income support
payments – even for a short period. Financial
hardship may also impact on the ability of an
individual or family to gain financial security
in the longer-term (ACOSS 2012).
Women who are escaping domestic and
family violence may be reliant on Parenting
Payment Single if their youngest child is
under eight years old. If their children are
over eight years old, they are likely to receive
the Newstart Allowance. The rates of
payments of Parenting Payment Single are
lower than other pensions, and Newstart
Allowance rates are lower still (ACOSS
2012). Recent evidence shows that, among
people of working age who are receiving
social security payments:
• at least a third receiving Newstart
Allowance, Parenting Payment or Disability
Support Payment lacked $500 in
emergency savings
• forty per cent on Newstart Allowance could
not afford to pay a utility bill on time in the
past year
• between 47 per cent and 60 per cent
receiving Newstart Allowance, Parenting
Payment Single and Disability Support
Payment identified their household as
‘poor’
• one fifth of children in families receiving
Newstart Allowance or Parenting Payment
lacked up-to-date school uniforms and
books (ACOSS 2012, p. 6). i
A woman leaving a violent relationship may
need to meet the cost of re-establishing a
home. She may also have legal, medical and
Catalyst Paper 3: Income security and economic abuse November 2012 2

other costs, as well as debts arising from the
economic abuse and other violence (Braaf &
Barrett Meyering 2011). In such
circumstances, low levels of income support
payments are likely to present a major barrier
to building financial stability. While there are
other social security arrangements that may
assist in situations of domestic and family
violence, these are unlikely to significantly
lessen the problem of low levels of payments.
This is discussed in further detail below.
WHAT ARE THE BARRIERS TO
ACCESSING INCOME SUPPORT
PAYMENTS AND OTHER ASSISTANCE?
The ALRC’s recent inquiry into the treatment
of family violence in Commonwealth laws
included a consideration of the legal
framework and administration of the social
security system (ALRC 2011a, 2011b). The
ALRC considered a large number of matters
and, in its final report, made extensive
recommendations relating to social security,
as well as other related areas of policy,
regulation and service provision. There is
only space here to touch on some of the key
issues raised in the ALRC’s inquiry.
The ALRC (2011a) made recommendations
for a common framework providing a
consistent definition of family violence in all
relevant Commonwealth legislation and other
guidelines. The ALRC (2011b) also identified
a range of barriers within the social security
Research on Centrelink and domestic and family violence
system that may prevent victims of domestic
or family violence from accessing payments.
The Commonwealth departments with key
responsibilities in this area are the
Department of Families, Housing, Community
Services and Indigenous Affairs (FaHCSIA),
which has policy responsibility, and the
Australian Government Department of
Human Services (DHS), which has
responsibility for Centrelink service delivery.
These departments were generally
supportive of the themes identified by the
ALRC. However, FaHCSIA did not support all
the proposals put forward in the initial ALRC
(2011b) discussion paper (DHS 2011;
FaHCSIA 2011).
Overarching issues for social security
identified by the ALRC include the need to:
• increase consistency, transparency and
certainty in the treatment of people
experiencing family violence
• improve support for disclosure of family
violence
• get greater consistency and transparency
in relation to the information that Centrelink
relies on to assess claims of family
violence.
The ALRC (2011a) final report included
recommendations for improved information in
the Guide to Social Security Law and for
“consistent, regular and targeted training” for
Centrelink staff and Social Security Appeals
Recent research by the Australian Domestic and Family Violence Clearinghouse explored the experiences of
women affected by domestic and family violence. The research revealed that most women found Centrelink
helpful in providing quick access to income support. However, it also identified the following barriers to
accessing Centrelink services:
• lack of readily available information about eligibility for different types of payments, particularly Crisis
Payment, and conflicting information about payments and requirements from staff
• lack of assistance to fill in forms
• having to frequently retell domestic violence experiences to different Centrelink staff and/or having to do so
without privacy – despite information already being on file
• lengthy waiting times for payments, gaps in payments and payments being cut off due to administrative
errors without compensation
• negative encounters with Centrelink staff (Braaf & Barrett Meyering 2011, pp. 96-98).
Catalyst Paper 3: Income security and economic abuse November 2012 3

Tribunal members (ALRC 2011a, p. 27). In its
submission to the inquiry, DHS (2011)
identified a current ‘Service Delivery Reform’
process as the main means through which it
is improving approaches to family violence.
Four other broad areas of the social security
system’s response to family violence are the
subject of recommendations made by the
ALRC. These are:
• how decisions are made about a person’s
relationship status and how family violence
is taken into account in these decisions
• proof of identity and residence
requirements for accessing benefits and
crisis payments
• methods of payments and overpayments
• taking account of violence in determining
capacity to work.
Key aspects of these issues are outlined
below.
DETERMINATION OF RELATIONSHIP
STATUS AND INCOME SUPPORT
If family violence is not properly taken into
account in social security decisions about a
person’s relationship status, this may have
implications for their eligibility for payments.
For example, where economic abuse is
present in a relationship, a woman may have
no or limited access to any financial
resources. Yet, at the same time, the woman
may be deemed ineligible for assistance. As
another example, a woman might be deemed
by Centrelink to be a member of a couple
when she has remained in a relationship due
to duress or because of economic abuse.
The ALRC (2011a) made a number of
recommendations to address these
concerns, including that changes be made to
the Guide to Social Security Law (the Guide).
FaHCSIA’s (2011) submission stated that
some of these issues were already
adequately dealt with in the Guide, but that
additional references to the issues could be
considered as part of the Guide review
processes.
ACCESS TO CRISIS PAYMENTS
A Crisis Payment equivalent to one week’s
standard benefit is available for people who
experience severe financial hardship due to
family or domestic violence. However, strict
eligibility requirements prevent some women
from accessing this payment. In order to
receive the payment, a person must:
• be already eligible for income support
payments
• have had to leave their home because of
violence or be remaining in the home after
a family member has left due to domestic
violence
• make the claim within seven days of the
‘extreme circumstance’ leading to it.
These conditions mean that women who are
not eligible for income support payments, and
women who experience violence perpetrated
by ex-partners, cannot access the payment.
Submissions to the ALRC inquiry raised
concerns about the restrictive conditions for
Crisis Payments ii . The ALRC (2011a)
responded with recommendations for the
Case study: Sandy
‘Sandy’ was a woman who spent more than one
week in hospital due to domestic violence. Upon
leaving hospital, she was taken to McAuley
Community Services for Women’s crisis
accommodation program. Sandy was 38 weeks
pregnant and was suffering from gestational
diabetes. She was denied a crisis payment for two
primary reasons. The first was that the incident of
violence had occurred more than seven days ago (it
had occurred 10 days ago when she made the
application. The fact she was in unconscious and
hospitalised due to the act of family violence was
disregarded). The second reason was that the act of
family violence did not occur in her home. Centrelink,
City of Yarra stated, “If it is outside the home it is an
assault and not domestic violence”.
Adaptation of a case study in a submission to the
ALRC by Good Shepherd Youth & Family Service,
Kildonan UnitingCare and McAuley Community
Services for Women (2011)
Catalyst Paper 3: Income security and economic abuse November 2012 4

Crisis Payment to be made available without
the need for income support eligibility,
without the requirement that it be associated
with the person or perpetrator leaving home
and without the seven day limitation on the
claim period. In its submission
to the ALRC, FaHCSIA (2011) was not
supportive of these proposed changes.
PAYMENT ARRANGEMENTS AND
OVERPAYMENTS
The ALRC made recommendations to
address concerns about access to other
payments and about payment arrangements.
These include a recommendation that family
violence should be named as a circumstance
in which urgent and advance payments may
be made. The ALRC also called for
clarification that urgent payments can be
made in family violence circumstances in
addition to Crisis Payments.
The ALRC also recognised the potential for
economic abuse to occur in payment
arrangements where a person receiving
social security has nominated someone else
to act as their ‘agent’. It recommended that
the effect of family violence should be taken
into account when considering a person’s
capacity to consent to a nominee
arrangement. This recommendation was not
supported by FaHCSIA in its submission to
the Inquiry.
In relation to overpayments, the ALRC
responded to concerns that economic abuse
cannot be taken into account when
considering whether a Centrelink debt can be
waived. The ALRC addressed this concern
by recommending an amendment to the
Social Security Act 1991. The ARLC also
identified that better information provision is
needed in this area.
RESIDENCE REQUIREMENTS
Residence requirements that restrict access
to income support payments are a problem
for women on temporary or other visas if they
experience domestic and family violence.
For example, these women may be unable to
leave a violent relationship due to the lack of
options for financial assistance. The ALRC
recognised this and made a number of
recommendations to address this problem. It
advised that changes should be made to
migration law. Further, it advised that
changes should be made to the eligibility for
Special Benefit, and sought a specific
exemption due to family violence from
income support waiting periods for newly
arrived residents. The Federal Government
has responded positively to one of the
ALRC’s recommendation for migration law
change and has indicated this is a
‘preliminary response’ (Bowen 2012).
INCOME MANAGEMENT
Under the income management scheme, a
proportion of a person’s income support
payments are ‘quarantined’ or only able to be
spent on certain goods and services. This
scheme has recently been extended, and
now applies in specific locations in five states
as well as in the Northern Territory. The
extension of the scheme to people
experiencing economic abuse has been seen
as ‘victim blaming’. It casts victims as
responsible for the circumstances created by
the abuse. It also implies that a lack of
financial knowledge and management skills
are the causes of poverty and low income
(ADFVC 2010). The ALRC considered the
treatment of family violence under the income
management scheme and concluded that:
“the complexity of family violence and the
intertwining of family violence with a number
of the ‘vulnerability indicators’ that trigger the
imposition of compulsory income
management leads to serious questions about
whether it is an appropriate response” (ALRC
2011a, p. 247).
The ALRC recommended that people
experiencing family violence should not be
subject to compulsory income management.
However, FaHCSIA’s (2011) submission
indicates that it does not support this
recommendation. The ALRC (2011a)
Catalyst Paper 3: Income security and economic abuse November 2012 5

ecommended a voluntary and flexible model
of income management for people
experiencing family violence. It also
recommended that people under income
management should not be prevented from
purchasing travel and other crisis-related
needs.
SUPPORTING WOMEN TO GAIN LONG-
TERM ECONOMIC SECURITY THROUGH
EMPLOYMENT PARTICIPATION
In contemporary public policy, employment
participation is generally regarded as the
primary means for women to gain economic
wellbeing. Employment is also regarded as a
pathway to economic independence and selfsufficiency
following domestic violence. In
addition, policies to address domestic and
family violence specifically identify
employment participation as a preventative
measure supporting women’s economic
independence.
The activity and participation requirements
for people receiving social security payments
can also have an impact on women who
have experienced economic abuse and other
violence. A major issue here concerns the
treatment of women who face numerous
barriers to seeking and gaining employment.
How well the social security system responds
to these women can be critical in preventing
hardship, supporting financial stability in the
short-term and assisting women to gain
economic wellbeing in the long-term.
Positive responses include minimising or
ceasing job seeker activity requirements for
women when appropriate, and ensuring that
women receive adequate assistance to
obtain and maintain suitable employment.
Multiple agencies have responsibilities in this
area, including Job Services Australia and
Disability and Indigenous Employment
services providers contracted by government.
The policies and practices of the Department
of Employment, Education and Workplace
Relations (DEEWR) along with FaHCSIA,
Centrelink and DHS shape the ways in which
people experiencing family violence are
treated as recipients of payments and as job
seekers.
The ALRC identified the need to change
policies and practices that relate to the
determination of individuals’ capacity to work
to improve protections for people
experiencing family violence. The ALRC
responded to concerns that processes
conducted by Centrelink and job services
providers were not conducive to disclosure of
family violence and may not take adequate
account of the impacts of family violence.
Concerns related to both the content and the
administration of the Job Seeker
Classification Instrument (JSCI). The JSCI
determines the level of employment
assistance that a person may receive and
whether they will be referred for further
assessment. This, in turn, may determine
whether a person is eligible for an exemption
from activity requirements.
The ALRC (2011a) recommended that the
JCSI be administered in person and in
private. DEEWR’s advice to the ALRC was
that this does not occur in the majority of
cases of initial assessments by Centrelink.
However, they advised that this practice was
in accordance with DEEWR’s guidelines to
job services agencies. iii The ALRC made
additional recommendations around training
for assessors and for increased requirements
on employment services providers to take
account of family violence in tailoring service
responses to individual job seeker needs.
They also recommended that a specific
family violence category of information be
included in the JSCI. They advised that the
JSI should take into account safety concerns,
caring responsibilities for children, and the
impact of family violence on a job seeker’s
housing, transport and health. Further, the
ALRC recommended a review of employment
services assessments with a focus on
impacts on job seekers experiencing family
violence.
Catalyst Paper 3: Income security and economic abuse November 2012 6

The ALRC responded to concerns that the
current exemptions from activity tests and
participation requirements are inadequate for
people who have experienced domestic and
family violence. These concerns included
that, in practice, there is a lack of awareness
of these exemptions. Furthermore, these
exemptions are often granted for short
periods only. This means that women often
have to re-apply for the exemptions and retell
their stories to someone else. The ALRC
recommended that the DEEWR review the
exemption periods to ensure that a long
enough time is allocated for victims of family
violence. They also recommended that family
violence be made a ‘reasonable excuse’ for
the purposes of activity tests and other
requirements.
Where to next?
EFFECTIVE EMPLOYMENT ASSISTANCE
It is critical for employment services to
effectively assist women who have
experienced violence, and who may have
been outside the workforce for a period of
time. There are many aspects of this issue
that cannot be considered in this paper. For
example, there is little published research
relating to effective responses in this area;
this could be the focus of further
investigation. Past Commonwealth
employment programs specifically designed
to assist sole parents, including the Jobs
Education and Training program, are
considered by community sector groups to
have been positive initiatives for women who
are parents and carers (ACOSS 2012).
This paper has sketched out some of the key areas that require action to ensure that the income
support system is a positive and effective support for people experiencing economic abuse. Its
purpose is to focus attention on these issues, and to prompt discussion and action to achieve
change. To this end, the following questions are posed:
In the wake of the ALRC’s inquiry how can we build on income support and employment
assistance policy and practice to enable women to gain long-term economic security
following economic abuse?
Do the ALRC recommendations adequately address the issues?
What views and insights do community sector organisations have in regard to the concerns
outlined by the ALRC review?
Are the ALRC recommendations being acted on by the Federal Government? If not, why
not? Are there other ways in which the social security system could better respond to
economic abuse?
Catalyst Paper 3: Income security and economic abuse November 2012 7

References
ACOSS (Australian Council of Social Service) 2012, 'Surviving
not living' Submission to Senate Employment Committee on
adequacy of 'allowance' payments, ACOSS Paper 192,
ACOSS, Strawberry Hills, NSW, viewed 25 August 2012,
.
ALRC (Australian Law Reform Commission) 2011a, Family
violence—commonwealth laws, discussion paper, discussion
paper no. 76, ALRC, Sydney.
ALRC (Australian Law Reform Commission) 2011b, Family
violence and commonwealth laws—improving legal
frameworks, Final Report, report 117, ALRC, Sydney.
Bowen 2012, media release 17 June, viewed 25 July at
).
Braaf, R & Barrett Meyering, I 2011, Seeking security:
promoting women’s economic wellbeing following domestic
violence, Australian Domestic & Family Violence
Clearinghouse, University of NSW, Sydney.
DEEWR (Department of Employment Educaiton and Workplace
Realtions) 2011, DEEWR submission into the Australian Law
Reform Commission Inquiry into Family Violence and
Commonwealth Laws, viewed 14 August 2012,
.
DHS (Department of Human Services) 2011, Response to
Australian Law Reform Commission Discussion Paper 76,
DHS, Canberra, viewed 14 August 2012, .
FaHCSIA (Department of Families, Housing, Community
Services and Indigenous Affairs) 2011, Submission to the
Australian Law Reform Commission inquiry into family violence
and Commonwealth laws, FaHCSIA, Canberra, viewed 12
August 2012, .
McGregor, K 2009, National community attitudes towards
violence against women survey 2009: a full technical report,
Australian Institute of Criminology, Canberra.
VicHealth 2010, National survey on community attitudes to
violence against women 2009: changing cultures, changing
attitudes—preventing violence against women, a summary of
findings, VicHealth, Carlton.
Weaver, TL, Sanders, CK, Campbell, CL & Schnabel, M 2009,
'Development and preliminary psychometric evaluation of the
domestic violence: related financial issues scale (DV-FI)',
Journal of Interpersonal Violence, vol. 24, no. 4, pp. 569-85.
Whiteford, P 2012, Submission to Senate Education,
Employment and Workplace Relations References Committee
Inquiry into the adequacy of the allowance payment system for
jobseekers and others, the appropriateness of the allowance
payment system as a support into work and the impact of the
changing nature of the labour market, Australian National
University, Canberra, viewed 25 August 2012, .
i
ACOSS citing data supplied by the Social Policy Research
Centre, University of NSW from the Poverty and Exclusion in
Modern Australia (PEMA) survey.
ii
Submissions to the ALRC can be viewed at
iii
The ALRC cites DEEWR correspondence15 June 2011 (ALRC
2011a, p. X, fn X).
8