Welfare groups and charities are concerned that changes to the welfare system are discriminatory and could leave some young people worse off.

Until now, the Income Management program has been a voluntary program to help participants' manage their payment.

Centrelink and participants work together to allocate a percentage of their payment to rent and bills, or onto a BasicsCard, which can only be used at designated shops.

As of July 1 the program will be expanded to cover young people on certain Centrelink payments.

Shepparton teenager, Stephanie (not her real name), will be impacted by the changes.

She moved out of her family home two years ago and receives the 'unreasonable to live at home' allowance.

"My dad was really sick and there was just a lot of fighting and stuff in the house because of my depression," she said.

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Stephanie says she is good at managing her own finances.

"By the time you pay rent and buy food, it's gone," she said.

"If you want to buy like , a new top or something, you have to go, well I'm just going to eat baked beans for a week."

From now, people on the unreasonable to live at home allowance will come under the Income Management program for a year.

After that, each case will be reviewed.

'Big Brother approach'

Welfare charity Berry Street says the changes could catch people, who do not want to have their payment managed, by surprise.

"It's very much a Big Brother approach," said Tricia Quibell.

"This will put a lot of pressure on Centrelink staff and they'll have a lot of very aggravated people who really don't feel as though they deserve to be put on income management."

Ms Quibell says the prospect of income management could discourage young people from seeking support.

Family Care in Shepparton CEO, David Tennant, is worried about the stigma of the BasicsCard.

"They're going to feel like every time they pull their card out they're identifying themselves as a person who is no good with money and not to be trusted," he said.

"I think that's a real problem."

The Minister for Families and Community Services, Jenny Macklin, says income management provides a tool to stabilise people's circumstances and ease immediate financial stress.

She says income management does not reduce the amount a person receives from Centrelink, it only changes the way in which they receive it.

But Stephanie says she doesn't see how it will help her.

"At the end of the day, how is anyone going to learn how to manage finance if its managed for you?"

"What about the people that are doing the right thing? It's not fair."