Tony Abbott says trials of a cashless debit card will help Indigenous communities lift their people up “by their bootstraps” and will ensure people do not “blow their dough” on harmful things.

The prime minister was speaking on the eve of his tour of northern Australian Indigenous communities as part of fulfilling a promise to spend a week a year those communities discussing issues important to Indigenous Australians.

It will be the second week Abbott has spent in Indigenous communities, following the pledge before the 2013 election.

Abbott will be joined by the secretary of prime minister and cabinet, Michael Thawley as he tours the Torres Strait, including Thursday Island as well as Cape York.

A number of his front bench team will also be in attendance, including health minister Sussan Ley, assistant health minister Fiona Nash, social services minister Scott Morrison, Indigenous affairs minister Nigel Scullion and his parliamentary secretary Alan Tudge.

The government is planning to roll out the first trials of the cashless debit card, which would contain 80% of payments to be spent on food and other basic necessities. Only 20% of the welfare payment would be available as cash placed into a person’s bank account.



“If people have got nothing to do, they can often blow their dough on things which are quite counterproductive, which are quite harmful,” Abbott said.



“What we need to do is ensure as far as possible, people in communities which are subject to serious dysfunction, are spending their money on what is going to help them rather than what is going to harm them.”



Community leaders in Ceduna have agreed to become the first trial site of the debit card. Local authorities could adjust the amounts placed in debit cards according to individual circumstances but would need to meet criteria such as sending children to school.



Under the Ceduna agreement, all working age income support recipients – black and white – would be subject to the trial. Abbott said he believed Indigenous communities were in favour of the card.

“All the indicators are that they want this because they want to lift their people up by the bootstraps, they want their people to face the future with confidence and pride and this debit card will help that to happen,” Abbott said.

Labor is still considering whether to support the debit card.

Abbott acknowledged disquiet in some communities about the debit card but said the idea, which came from the Andrew Forrest review of Indigenous employment, would form part of a better future for Aboriginal communities.



“I think if you’ve seen a whole lot of programs start and fail, if you’ve seen a whole lot of promises that never really materialise, a certain level of scepticism is understandable but this is quite a dramatic break from the past,” Abbott said.

“We all know back in the 60s Aboriginal people didn’t have much money, they didn’t always receive the respect they deserve but they were in the real economy and they did have pride.

“Then of course the welfare economy came in and that has done untold damage to a couple of generations to Aboriginal people. All the serious leaders of Indigenous Australia know that sit-down money has been poison, all of them know that chronic welfare dependency can lead to very serious personal dysfunction.

“This debit card is not the whole answer but it’s a very important part of a better future for Aboriginal people and indeed for welfare dependent communities right around our countries.”

Speaking about his Indigenous week, Abbott said “there is a sense in which Aboriginal people are finally getting the attention they deserve”.



“There’s nothing like being the man on the spot,” he said. “We can read all the briefing papers in the world, we can read the books, we can talk to the experts but there is nothing like being present on the spot to see the good and the bad and to see a way forward.”