"It's not unreasonable for the taxpayer to say:'Well,I'm happy to give you the support. But I'm not going to have you spend it on drugs or gambling'."
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Labor supported the initial 2016 cashless debit trials in remote Australia but opposes the addition of extra sites and a national roll-out,citing a lack of evidence and community support.
The government is preparing to allow Australians to volunteer to take part in the pilot income management program,as soon as January 1,and is working with banks and business to iron out issues with the card's use in stores,improve mobile phone payment technology and merge the quarantined cash system with regular bank cards.
Mr Morrison said he would take his time before putting in place plans for a wider roll out.
"Its success in these communities has been that the communities themselves have been the ones that have decided to proceed with it,"he said.
"I think it would be a mistake not to appreciate how important that has been in its success."
Coalition MPs have called for a broader roll out to regions of high unemployment and disadvantage,having been buoyed by recent results from a trial of those aged under 36 in Bundaberg and Hervey Bay in Queensland.
Youth unemployment in the region has dropped from 19.8 per cent in January to 18.5 per cent in August,with the number of people in the region on welfare falling at double the national rate.
Initial findings from two trial communities of Ceduna and the East Kimberley found that 41 per cent of participants reported drinking alcohol less frequently,48 per cent reported gambling less and 48 per cent reported using illegal drugs less often.
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The evaluation also found"widespread spill-over benefits"from the card,with 40 per cent of the trial participants surveyed saying they were better able to look after their children.
The Australian National Audit Office found in June last year it was"difficult to conclude"where social harm had been reduced due to a"lack of robustness in data collection".
New independent studies from the University of South Australia into the trials of the card are set to be completed by the end of the year.
St Vincent de Paul is among many welfare groups who have criticised the measures,saying there is no evidence compulsory income management results had widespread or sustained benefits – either to individuals or communities.