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“Completely tacky”: Bride slammed for asking for dinner payment

A bride has caused a stir online after asking if it is appropriate to ask her wedding guests to pay for their meal when they RSVP to the big day. The woman took to a popular wedding Facebook page to ask the opinions of other brides, sharing an example of her invitation created by her wedding planner. The invitation asks guests to confirm whether or not they will be attending the nuptials, before asking if the guest intends to eat at the wedding ceremony, and which meal they would prefer. The price of each meal was also included: $20 for grilled chicken with rice, mashed potatoes and green beans and $25 for a salmon alternative. “We invite you to eat with us but ask for you to provide your own payment. Please select which meal you'd prefer,” the invite stated. “My wedding venue requires me to purchase food through them for the reception, but has said people sometimes choose this option,” the woman wrote on Facebook. “Nothing about my reception is very typical anyway, SO I'm wondering how insane or rude or cost-effective/smart this is.” “The planner set me this as an example of how to present it to guests.” But when the post was quickly criticised by others, the bride clarified the event was more of a “fun dinner party” rather than a “wedding” as she and her partner had already legally married five months prior. “Ultimately I'll do what I want BUT I did not choose this option. It was only a suggestion from the venue that I was curious about others' opinions on,” she added. “This is for the reception. I'm most definitely not asking for money or gifts and by the time they come to the reception, we will have already been married for five months.” The post was shared in another wedding shaming Facebook group and critiqued by dozens of wedding experts. “Oh hell no! This is completely tacky!” one wrote, another said, “So she asks if it is rude then gets offended when people say it's rude?” “I am a veteran pro planner and would NEVER suggest this!” another said. Someone else wrote, “I'm especially shaming the venue for suggesting that people often pawn off the cost of dinner to their guests. Encouraging rude behaviour.” Image credits: Getty Images / Facebook

Food & Wine

The move to a cashless society isn’t just a possibility, it’s well underway

<a href="https://theconversation.com/profiles/angel-zhong-1204643">Angel Zhong</a>, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a> When was the last time you used cash? For many Australians using cash or even swiping a card has become a rare event. The move towards a cashless society started 50 years ago with the introduction of the Bankcard and was driven by technological advancements. But it really took off with the COVID pandemic when consumers and retailers were reluctant to handle potentially infected notes and coins. The federal government last week underscored its recognition of this trend by <a href="https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/modernising-payments-regulation">unveiling reforms</a> to regulate digital payment providers. Treasurer Jim Chalmers said: "As payments increasingly become digital, our payments system needs to remain fit for purpose so that it delivers for consumers and small businesses. We want to make sure the shift to digital payments occurs in a way that promotes greater competition, innovation and productivity across our entire economy." From big cities to remote rural corners the shift towards digital payments is evident. This raises the question, is a cashless society inevitable? <h2>The phenomenal growth of the digital payments</h2> The convenience of digital transactions has become irresistible for consumers and businesses and has led to the sector eclipsing traditional payment methods. The relentless march of technology has produced myriad innovative platforms from mobile wallets to buy-now-pay-later (BNPL) schemes, each vying for a piece of this burgeoning market. A recent <a href="https://www.ausbanking.org.au/wp-content/uploads/2023/06/Bank-On-It-%E2%80%93-Customer-Trends-2023-1.pdf">report</a> by the Australian Banking Association paints a vivid picture of the digital payment industry’s explosive expansion. The use of digital wallet payments on smartphones and watches has soared from $746 million in 2018 to over $93 billion in 2022. Cash only accounts for 13% of consumer payments in Australia as of the end of 2022, a stark contrast to 70% in 2007. Digital wallets are popular with most age groups. Young Australians aged between 18 and 29 are leading the pack, with two thirds <a href="https://www.rba.gov.au/publications/bulletin/2023/jun/consumer-payment-behaviour-in-australia.html">using digital wallets</a> to pay for goods and services. About <a href="https://www.ausbanking.org.au/almost-40-leave-wallets-at-home/">40% of Australians</a> are comfortable leaving home without their actual wallets or even credit or debit cards, as long as they have their mobile devices with digital wallets. The astonishing speed at which Australians have embraced digital payments places the country among the top users of cashless payments globally, surpassing the United States and European countries. Digital wallets are not the only players in this space. The use of BNPL products is also growing rapidly in Australia, which was where many of the large-scale products in this category started. The Australian Securities and Investment Commission (ASIC) reports the total value of all BNPL transactions increased by <a href="https://asic.gov.au/regulatory-resources/find-a-document/reports/rep-672-buy-now-pay-later-an-industry-update/">79% in the 2018–19 financial year</a>. This continues into 2022 with an annual growth beyond 30% according to the <a href="https://www.rba.gov.au/publications/annual-reports/psb/2022/the-evolving-retail-payments-landscape.html">Reserve Bank of Australia</a> (RBA). PayID and PayPal payments are also claiming their shares in this space. <h2>Are government regulations necessary?</h2> The government’s planned regulation of the system, contained in amendments to the Reforms to the Payment Systems (Regulation) Act 1998, is a big step towards establishing a secure and trustworthy cashless society in Australia. It will subject BNPL and digital wallet service providers like Apple Pay and Google Pay to the same oversight by the RBA as traditional credit and debit cards. The regulations will require providers meet clear standards for security measures, data protection and dispute resolution to give Australians confidence their funds and personal information are safeguarded. With increasing concern over cyber attacks, the regulations will help reduce the risk of fraudulent activities and money laundering and help identify suspicious transactions, maintaining the integrity of the financial system. Also, regulation will promote fair competition and market stability by levelling the playing field and by preventing monopolies. While banks support the forthcoming regulation, new market players are less positive. For example, Apple Pay says it is merely <a href="https://www.afr.com/companies/financial-services/new-rba-powers-to-regulate-apple-google-payments-20231010-p5eb6d">providing technical architecture</a> rather than payment services. The current regulatory debate is not new. When credit cards made their debut in Australia in the early 1970s, there were hardly any safeguards for consumers. This led to card users being hit with high interest rates on money owed, sneaky fees and aggressive marketing tactics. Consequently, regulations were introduced to hold card providers to a standard of responsible behaviour. Today, they must openly disclose interest rates, fees and charges, and follow stringent guidelines in advertising their products and services. Regulating digital wallet providers strikes a crucial balance between innovation and accountability, ensuring life-changing technology continues to serve the public interest. The shift towards a cashless society in Australia isn’t just a possibility, it’s already well underway. The blend of technological advancements, changing consumer preferences and regulatory adaptations has set the stage for this transformation. The new regulations will help Australians navigate this transition more confidently.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/215446/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/angel-zhong-1204643">Angel Zhong</a>, Associate Professor of Finance, <a href="https://theconversation.com/institutions/rmit-university-1063">RMIT University</a> Image credits: Getty Images This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/the-move-to-a-cashless-society-isnt-just-a-possibility-its-well-underway-215446">original article</a>.

Money & Banking

Lump sum, daily payments or a combination? What to consider when paying for nursing home accommodation

<a href="https://theconversation.com/profiles/anam-bilgrami-1179543">Anam Bilgrami</a>, <a href="https://theconversation.com/institutions/macquarie-university-1174">Macquarie University</a> Moving yourself or a loved one to a nursing home can be <a href="https://theconversation.com/should-we-move-our-loved-one-with-dementia-into-a-nursing-home-6-things-to-consider-when-making-this-tough-decision-189770">emotional and difficult</a>. While some have their nursing home accommodation costs fully covered by the government (based on a <a href="https://www.myagedcare.gov.au/how-much-will-i-pay">means test</a>), most will have to pay their own way. The average lump sum room value is <a href="https://www.health.gov.au/sites/default/files/documents/2021/08/ninth-report-on-the-funding-and-financing-of-the-aged-care-industry-july-2021.pdf">A$334,000</a>. Choosing how to pay can make this time even more challenging, particularly for those with <a href="https://theconversation.com/would-you-pass-this-financial-literacy-quiz-many-wont-and-its-affecting-expensive-aged-care-decisions-175063">low financial literacy</a>. This is an important and complex decision. It can affect your income, wealth, means-tested aged care fee, and bequests. Here are some things to consider before you decide. <h2>3 ways to pay</h2> You can <a href="https://www.myagedcare.gov.au/understanding-aged-care-home-accommodation-costs">pay</a> for a nursing home room in three ways. You can pay the entire room price as a one-off, refundable lump sum (a “refundable accommodation deposit”, sometimes shortened to RAD). This lump sum is refunded to the resident or their estate when the person leaves the nursing home (if they move or pass away). The refund is <a href="https://www.myagedcare.gov.au/aged-care-home-accommodation-refunds">guaranteed by the government</a>, even if a provider goes bankrupt. People who don’t want to pay a lump sum can instead choose rent-style, “daily accommodation payments” (sometimes shortened to DAP). These are fixed, daily interest-only payments calculated on the total room price. The rate at which they are calculated is known as the “maximum permissible interest rate” or MPIR. The maximum permissible interest rate is set by the government and is currently <a href="https://www.health.gov.au/sites/default/files/2023-06/base-interest-rate-bir-and-maximum-permissible-interest-rate-mpir-for-residential-aged-care_0.pdf">7.9%</a> per annum. The <a href="https://www.health.gov.au/our-work/residential-aged-care/managing-residential-aged-care-services/managing-accommodation-payments-and-contributions-for-residential-aged-care#accommodation-payment">formula</a> for a daily accommodation payment is (RAD × MPIR) ÷ 365. Unlike lump sums, daily accommodation payments are not refunded. The third option is a <a href="https://www.health.gov.au/our-work/residential-aged-care/managing-residential-aged-care-services/managing-accommodation-payments-and-contributions-for-residential-aged-care#accommodation-payment">combination payment</a>. This means paying part of the room price as a lump sum, with daily payments calculated on the remaining room amount. On leaving the home, the part lump sum is refunded to the resident or their estate. With a combination payment, the consumer can choose to pay whatever amount they like for the lump sum. The table below shows three different ways someone could pay for a room priced at $400,000. <figure class="align-center zoomable"><a href="https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img src="https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" srcset="https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=432&fit=crop&dpr=1 600w, https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=432&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=432&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=542&fit=crop&dpr=1 754w, https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=542&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/540310/original/file-20230731-130241-shaphm.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=542&fit=crop&dpr=3 2262w" alt="" /></a><figcaption><a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></figcaption></figure> So which is best? It’s impossible to say. It depends on a person’s circumstances, family situation, finances, preferences and expected length of stay. <h2>Why do some people choose a lump sum?</h2> One downside of a lump sum (or part lump sum) is that choosing this option means this money is not invested elsewhere. By handing over the lump sum, for example, you forgo returns you could have made by investing this same money into property or stocks over the period of your nursing home stay. On the other hand, paying lump sum means you get to avoid the daily interest payments (the 7.9% in the table above). So you could potentially be better off paying a lump sum if you think there’s no way you could make investment returns on that money that are substantially higher than the interest you’d be charged through daily payments. One advantage of choosing a lump sum is it’s considered an <a href="https://www.dva.gov.au/get-support/health-support/care-home-or-aged-care/help-pay-home-or-aged-care/residential-aged-0">exempt asset</a> for pension purposes; some people may get more <a href="https://www.afr.com/wealth/personal-finance/five-things-you-need-to-know-about-aged-care-deposits-20200302-p54606">pension</a> if they pay the lump sum. The lump sum, however, does count as an asset in determining the <a href="https://www.health.gov.au/our-work/residential-aged-care/charging-for-residential-aged-care-services/residential-aged-care-fee-scenarios-for-people-entering-care-from-1-july-2014">means-tested care fee</a>. And if you sell your house, remember any money leftover after you pay the lump sum will be counted as assets when you’re means-tested for the pension and means-tested care fee. <h2>Why might some people prefer daily payments?</h2> Not everyone can can afford a lump sum. Some may not want to <a href="https://theconversation.com/is-it-worth-selling-my-house-if-im-going-into-aged-care-161674">sell their home</a> to pay one. Some may want to hold onto their house if they think property prices may increase in the future. Daily payments have recently overtaken lump sums as the most <a href="https://www.health.gov.au/sites/default/files/documents/2021/08/ninth-report-on-the-funding-and-financing-of-the-aged-care-industry-july-2021.pdf">popular payment option</a>, with 43% of people paying this way. However, recent <a href="https://amp-smh-com-au.cdn.ampproject.org/c/s/amp.smh.com.au/money/super-and-retirement/aged-care-interest-rate-increase-sees-daily-payments-almost-double-20230324-p5cuz2.html">interest rate rises</a> may slow or reverse this trend. And if a spouse or “<a href="https://www.dva.gov.au/get-support/health-support/care-home-or-aged-care/residential-aged-care/aged-care-costs">protected person</a>” – such as a dependant or relative that meets certain criteria – is still living in the house, it’s also exempt from assets tests for the pension and other aged care fees. If the home is vacated by a protected person, its value is still excluded from the pension means test for <a href="https://www.dva.gov.au/get-support/health-support/care-home-or-aged-care/help-pay-home-or-aged-care/residential-aged-0">two years</a> (although rental income is still assessed). If you do not anticipate a lengthy nursing home stay, daily payments may potentially be the easiest option. But it’s best to consult a financial adviser. <h2>What does the research say?</h2> My <a href="https://www.mq.edu.au/__data/assets/pdf_file/0007/1190086/What-drives-end-of-life-financial-decisions.pdf">research</a> with colleagues found many people choose the lump sum option simply because they can afford to. Those <a href="https://ahes.org.au/portfolio-items/entering-aged-care/">owning residential property</a> are more likely to pay a lump sum, mostly because they can sell a house to get the money. People who consult financial advisers are also more likely to choose lump sums. This may be due to <a href="https://www.afr.com/wealth/aged-care-costs-most-opt-for-pay-as-you-go-20181023-h170g4">financial advice</a> suggesting it’s tough to earn investment returns higher than what you’d save by avoiding the interest charged in the daily payment option. Some aged care providers <a href="https://www.mq.edu.au/__data/assets/pdf_file/0003/1164243/the-role-of-refundable-accommodation-deposits-FINAL.pdf">prefer</a> lump sum payment since they <a href="https://www.agedcarequality.gov.au/providers/prudential-standards/permitted-use-refundable-deposits">use</a> these to renovate or refurbish their facilities. But providers are not allowed to influence or control your decision on how to pay. The recent Royal Commission into Aged Care recommended <a href="https://agedcare.royalcommission.gov.au/sites/default/files/2021-03/final-report-recommendations.pdf">phasing out</a> lump sums as a payment option, leaving only daily payments. While that would reduce the complexity of the payment decision and remove the incentive for providers to sway decisions, it would also reduce consumer choice. <h2>Is there anything else I should know?</h2> Some 60% of people we <a href="https://www.mq.edu.au/__data/assets/pdf_file/0007/1190086/What-drives-end-of-life-financial-decisions.pdf">surveyed</a> found the decision complex, while 54% said it was stressful. It is best to seek professional <a href="https://www.myagedcare.gov.au/understanding-aged-care-home-accommodation-costs#financial-advice">financial advice</a> before you decide. Services Australia also runs a free <a href="https://www.servicesaustralia.gov.au/what-financial-information-service?context=21836">Financial Information Service</a> that can help you better understand your finances and the payment decision. But it does not give <a href="https://www.servicesaustralia.gov.au/financial-information-service-officers?context=21836#a2">financial advice or prepare plans</a>. You have <a href="https://www.health.gov.au/our-work/residential-aged-care/managing-residential-aged-care-services/managing-accommodation-payments-and-contributions-for-residential-aged-care">28 days to choose a payment method</a> after admission, and six months to pay if you <a href="https://www.health.gov.au/our-work/residential-aged-care/managing-residential-aged-care-services/managing-accommodation-payments-and-contributions-for-residential-aged-care">choose a lump-sum payment</a>. In the interim, you will be charged daily interest payments on the room price.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/207405/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/anam-bilgrami-1179543">Anam Bilgrami</a>, Research Fellow, Macquarie University Centre for the Health Economy, <a href="https://theconversation.com/institutions/macquarie-university-1174">Macquarie University</a> Image credits: Getty Images This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/lump-sum-daily-payments-or-a-combination-what-to-consider-when-paying-for-nursing-home-accommodation-207405">original article</a>.

Retirement Life

Cash could be almost gone in Australia in a decade – but like cheques, who’ll miss it?

<a href="https://theconversation.com/profiles/peter-martin-682709">Peter Martin</a>, <a href="https://theconversation.com/institutions/crawford-school-of-public-policy-australian-national-university-3292">Crawford School of Public Policy, Australian National University</a> Late last year, the Reserve Bank gave 1,000 Australians diaries and asked them to record every payment they made over the course of a week. Of the 13,000 payments, only <a href="https://www.rba.gov.au/publications/bulletin/2023/jun/consumer-payment-behaviour-in-australia.html">17</a> were with cheques. It’s been an astounding collapse. Back in 1980 at the start of the credit card era, <a href="https://www.rba.gov.au/publications/bulletin/1996/oct/pdf/bu-1096-2.pdf">85%</a> of non-cash payments were made with cheques. Today it’s less than <a href="https://www.rba.gov.au/publications/bulletin/2023/jun/consumer-payment-behaviour-in-australia.html">0.1%</a>. Earlier this month, the government announced it was following <a href="https://www.justice.govt.nz/about/news-and-media/news/the-ministry-is-phasing-out-payment-by-cheque/">New Zealand</a>, Denmark, the Netherlands and <a href="https://www.sbs.com.au/news/article/the-death-of-the-cheque-book-australia-to-phase-out-cheques/qu0e4xf55">others</a>, closing our cheque system down by <a href="https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/modernising-payments-infrastructure-phasing-out-cheques">2030</a>. Meanwhile, New Zealand is already on to the next thing. Having <a href="https://www.stuff.co.nz/business/300011579/bnz-anz-westpac-to-phase-out-cheque-use">phased out cheques</a>, it’s now looking at winding down the use of <a href="https://www.rbnz.govt.nz/-/media/project/sites/rbnz/files/research/future-of-cash-issues-paper.pdf">cash</a>. So how close is Australia now to becoming a cash-free nation? <h2>The hidden costs of cheques and cash</h2> Cheques are horrendously expensive to process. The average cost of everything that had to happen to process a cheque exceeds <a href="https://www.rba.gov.au/publications/rdp/2014/pdf/rdp2014-14.pdf">$5</a> per payment, mostly borne by banks. But cash is expensive in its own way. The average cost of creating, sorting and trucking all those sheets of plastic and coins exceeds <a href="https://www.rba.gov.au/publications/rdp/2014/pdf/rdp2014-14.pdf">50 cents</a> per payment, mostly passed on to banks and retailers, and it is soaring as the number of payments plummets. As recently as 2007, the vast bulk of consumer payments – 69% – were in cash. By 2019 only 27% were in cash. By 2022, after two years of COVID, it was only <a href="https://www.rba.gov.au/publications/bulletin/2023/jun/consumer-payment-behaviour-in-australia.html">13%</a>. At this rate, it’s hard to be certain how long cash will last. <h2>What made cheques so slow and costly</h2> For those who’ve never had to write one, cheques are bank-issued pieces of paper on which the owner writes the name of the person they want the bank to pay and the amount. They they hand it to that person, who then hands it to their bank, which then tries to get the money from the payer’s bank. <figure class="align-right "><figcaption></figcaption></figure> Behind the scenes, until recently when the electronic transmission of digital images changed things, each bank would collect all the cheques that had been presented to its branches each day and sort them into bags, one for each originating bank. Then, late at night, its “bag man” would travel to a nondescript city location with a bag for each bank, hand the correct one to each of the other bagmen, and be given bags in return, which the bagman would take back to the bank for signature checking. When each bank worked out what it owed the other bank, they would usually discover the flows largely cancelled each other out, and then make net payments which would be reflected in the cheque-writer’s account, up to five business days later. Always expensive, the cost per cheque grew and grew as the number of Australians paying with cheques dwindled to a fraction of what it had been. <h2>How moving cash became a loss-making business</h2> It’s the same sort of story with cash. Although we don’t often think about it, cash costs an awful lot to move, sort and restock. Printing the notes still makes money – it costs about 32 cents to make each note, whether it’s worth $5 or $100, although making some coins now <a href="https://theconversation.com/the-mint-and-note-printing-australia-make-billions-for-australia-but-it-could-be-at-risk-190901">loses money</a>. The real expense is in moving notes and coins around, keeping them nearby and restocking banks and cash registers. Aside from payments the Reserve Bank makes to banks for returning damaged notes, the banks (and, through them, the retailers) are expected to pay for the lot. Until recently that gave the two firms that dominate the business (Linfox Armaguard, and Prosegur, which owns Chubb Security) a pretty good deal. Except that the volume of cash they’ve carried has dived <a href="https://www.accc.gov.au/system/files/public-registers/documents/Application%20for%20merger%20authorisation%20-%2027.09.22%20-%20PR%20VERSION%20-%20MA1000022%20Armaguard%20Prosegur.pdf">47%</a> over the past ten years, 30% of it during COVID. Both firms say their money-moving arms are incurring “heavy financial losses” and that if they increase their prices much more, retailers might move even <a href="https://images.theconversation.com/files/532829/original/file-20230620-48940-4a5amn.PNG">further away from cash</a>, pushing their costs even higher. <figure class="align-right zoomable"><figcaption></figcaption></figure> Last week, the Competition and Consumer Commission allowed them to <a href="https://www.accc.gov.au/public-registers/mergers-registers/merger-authorisations-register/linfox-armaguard-pty-ltd-and-prosegur-australia-holdings-pty-ltd-proposed-merger">merge</a> on the condition that they limit their price increases to the consumer index plus 7.5% per year. That increase is so steep as to suggest a <a href="https://www.energynetworks.com.au/news/energy-insider/the-death-spiral/">death spiral</a>: the more they charge, the less retailers will use cash, the more they’ll have to charge. The only way out, unless they can make really big efficiencies, or unless the decline in the use of cash stops, would be for the government to return to subsidising the use of cash. It’s hard to see how it could make the case to do that when there are cheaper emerging technologies. Bank transfers cost a <a href="https://www.rba.gov.au/publications/rdp/2014/pdf/rdp2014-14.pdf">mere fraction</a> of using cash, and pretty soon we’ll be able to use them for everything, via things such as <a href="https://www.mobiletransaction.org/qr-code-payment-works/">QR codes</a>. <h2>So when will cash go the way of cheques?</h2> A previous federal government has already tried to eliminate the use of cash for transactions worth more than $10,000, as part of its attack on the black economy. Announced in 2016 by the Turnbull Coalition government, the ban was due to come into force in <a href="https://ministers.treasury.gov.au/ministers/kelly-odwyer-2016/media-releases/tackling-illegal-behaviour-black-economy">2019</a>. But, after delays, in 2020 the Morrison-led Coalition government <a href="https://www.abc.net.au/news/2020-12-07/cash-ban-law-10000-dollars-abandoned-amid-covid-crisis/12951720">backed down</a>. If Australia wants to ban cash (and ban it for small transactions too – cash is now used less than cards for transactions <a href="https://www.rba.gov.au/publications/bulletin/2023/jun/cash-use-and-attitudes-in-australia.html">of all sizes</a>) the easiest solution might be simply to wait. <hr /> <iframe id="HykMF" class="tc-infographic-datawrapper" style="border: none;" src="https://datawrapper.dwcdn.net/HykMF/10/" width="100%" height="400px" frameborder="0"></iframe> <hr /> Cards are now the dominant means of exchanging money, and electronic transfers are growing from a small base. Pure extrapolation would suggest cash has less than a decade to go, but it will probably hang around for longer as an (expensive, little-used) backup that maintains privacy. Like cheques, cash will probably die <a href="https://quoteinvestigator.com/2018/08/06/bankrupt/">gradually, then suddenly</a>. By the time it does, there will be few users left who care.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/208020/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/peter-martin-682709">Peter Martin</a>, Visiting Fellow, <a href="https://theconversation.com/institutions/crawford-school-of-public-policy-australian-national-university-3292">Crawford School of Public Policy, Australian National University</a> Image credits: Getty Images This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/cash-could-be-almost-gone-in-australia-in-a-decade-but-like-cheques-wholl-miss-it-208020">original article</a>.

Money & Banking

Big changes for Bunnings Warehouse snags

There’s nothing quite like a weekend shop at Bunnings, largely because it means there’ll be a fresh snag waiting for you post-shop, and with the hardware store’s latest announcement, it will be even easier to get your hands on one. Bunnings Warehouse has announced it is rolling out mobile payment options for customers who aren’t carrying cash or coins on them. Until now, most Bunnings sausage sizzles largely relied on cash payments, at the discretion of each community group that hosts their sausage sizzle, but the cardless concept proved difficult in a largely cashless economy. The Bunnings website states, "Not-for-profit organisations are able to book a sizzle with their local store - they need to bring volunteers and adequate supplies and Bunnings helps with the rest.” "The rest" being the addition of free mobile payment facilities. "We offer a free mobile payment option to community groups fundraising through sausage sizzles at our stores, providing an easy way for them to maximise fundraising and offering customers a cashless way to pay for their snag and support their local community group," said Bunnings General Manager Operations Matt Tyler in a statement. There will be no additional cost to customers or community groups, who previously had to bring their own EFT machine if they wanted to pay by card. Bunnings Warehouse will be incurring all the transaction fees to ensure community groups get 100 per cent of all the money raised. Image credit: Shutterstock / Instagram

Food & Wine

"What am I going to do?”: Centrelink mother points out crucial flaw in new budget policy for parents

An unemployed mother who relies on Centrelink benefits has broken down while noting a fatal flaw in Treasurer Jim Chalmers’ Federal Budget promises to parents. Jessica Blowers told ABC’s Q&A program that she will be forced off the Single Parent Payment when her daughter turns eight in August, leaving her unable to afford the rent increases. Currently, single parents can claim the Parenting Payment of $949.30 a fortnight until their youngest child turns eight. By September 2023, the age limit for the pay rise to when the youngest child is 14, as part of Chalmers’ budget. Ms Blowers is one of many copping the brunt of it as her daughter’s 8th birthday is four weeks before the new rules begin. She will also see a rent increase during that period from $900 a fortnight to $960. “What am I going to do? What is my choice, other than I am doing my best to get a job so that I can keep a house over my daughter's head,” she stressed to the treasurer. “When I'm applying for the jobs, I am faced with being told that more than 100 other candidates have applied for the same jobs - I'm not sure how I am supposed to compete against 100 other people for one job.” Ms Blowers added she “would like to know what measures the government has in place to bridge the gap that I and other parents in similar situations will find ourselves in”. “I don't have anywhere to go because I am paying my entire pension in rent. Everywhere else in Sydney is comparable to that.” Although sympathetic to her situation, Chalmers said those suffering like Ms Blowers were “the reason why we are lifting the age from eight to 14”. “This is something we were really keen to do in the Budget because we recognise the pressure that you are under as a single mum,” he explained. However, Chalmers was adamant that the new system could not be introduced any earlier than September 20, 2023. “We've tried to do is bring that change in as soon as possible. We think September is the soonest that we can do it,” he said. “I understand that that means a few weeks for you going from the current payment onto JobSeeker and (then) back onto the single parenting payment. “I would love to avoid that if we could, but what we're trying to do is provide this extra assistance ... that you need and deserve. If we could avoid those couple of weeks, we would, but September is the best we can do.” In total, some 57,000 single parents, 90 per cent of whom are women, will benefit from the new scheme. Previously they would have been moved onto the lower JobSeeker rate when their youngest child turned eight. “By age 14, children have typically settled into high school and need less parental supervision, and single parents are in a much stronger position to take on paid work," Prime Minister Anthony Albanese said when the policy was announced. Historically, the single parent payment was eligible for singles with children aged up to 16. But former prime minister John Howard, later supported by Julia Gillard, cut the age to eight in an attempt to encourage parents back into the workforce. Two advisory bodies have called for the government to extend the payment and the eligibility criteria. It is understood mutual obligation requirements will remain in order to continue encouraging parents to go back to work. Speaking to Nova radio in Perth, Mr Albanese explained he knew “firsthand what it's like to grow up with a single mum doing it tough”. “We want to look after single parents because we know that the role that they play in raising their children is such a priority for them and they’re deserving of more support,” he said. Image credit: ABC Q&A

Money & Banking

Over-55s the only group to receive Centrelink payment boost

Older recipients of JobSeeker will receive a higher welfare payment as the federal budget is set to include an increase in payments for 227,000 Aussies. According to 7News, the budget will include an increase in the base rate of the JobSeeker for people aged 55 and above. The change honours Treasurer Jim Chalmers’ promise that an increase “will be focused on the most vulnerable”. Finance Minister Katy Gallagher previously committed to a “significant improvement” in terms of the budget. When asked if the rate of JobSeeker would be lifted, Gallagher revealed the budget would contain “ongoing” investments to help people with cost-of-living pressures, in addition to one-off measures. “This budget will have a significant cost-of-living package and that cost-of-living package will be targeted to the most vulnerable Australians,” she said. About 227,000 Jobseeker recipients are 55 and over, which is the highest number of any age group and the group most likely to be unemployed long-term, meaning they are without a job for five years or more. The majority of people in this group are women. Senior sources reportedly told 7News that the increase will be modest, not the $100-a-week advocates are hoping for but what the budget can afford. The change is unlikely to please Raise the Rate campaigners, who have called for the government to bring payments above the poverty line. 7News reported that the government will sell the moderate increase as a “responsible first step”, an increase that will help the most vulnerable of JobSeeker recipients and honours its election commitment to do what it can to help within the restraints of the budget. The pressure continues to pile up for the government to substantially increase income support payments above $49.50 a day for singles on JobSeeker and $40.20 a day for Youth Allowance. An open letter to the Prime Minister, which has been signed by more than 300 politicians, community advocates and prolific Aussies, called for an increase to be included in the budget to support those most in need. “Right now, the rate of JobSeeker is so low that people are being forced to choose between paying their rent or buying enough food and medicine,” the letter, coordinated by the Australian Council of Social Service, read. In 2022, the council’s research found six in 10 people on income support were eating less or reporting difficulty getting medicine or care due to their inadequate income. This increased to seven in 10 in March 2023. The budget plans to extend single-parenting payments and increase rental assistance - particularly for women. Around $120 billion in Morrison Government road and rail projects will be reviewed and money reprioritised, with hundreds of smaller projects likely to be stopped. Image credit: Getty

Money & Banking

Only days left for one Aussie state's residents to make $1000 claim

New South Wales residents who faced the brunt of July 2022’s floods have only one week remaining to claim their $1000 lump sum payment. Prime Minister Anthony Albanese announced the Disaster Recovery Payment [DRA] - of $1000 per adult and $400 per child - as he set off to tour some of the hardest hit regions in July 2022. The news gave some hope to those who had lost everything in the disaster that swept through their homes, and the chance to secure the likes of clothing, food, and temporary shelter. At the peak of the devastation, over 100 evacuation orders - amounting to roughly 85,000 people - had been issued across the state, with thousands of properties inundated, with SES crews responding to over 370 flood rescues, and a frightening 7600 help requests. People living in the local government areas [LGAs] that were directly impacted by the floods are eligible, although certain criteria must be met. Service Australia outlines that you (or a dependent child to whom you’re the principal carer) must be an Australian citizen or hold an eligible visa, be in an eligible LGA, and must be claiming the payment for the first time. Those whose homes suffered major damage due to the floods and required either repair or replacement in certain areas, as well as those whose “major assets” - the likes of caravans, vehicles, water tanks, and sheds - were also in need of repair or replacement are eligible for the payment as well. And residents who were seriously injured, or had an immediate family member (who is/was an Australian citizen) die or go missing in the floods, are also eligible. Furthermore, individuals who lost income as a direct result of the floods may be able to get the Australian Government Disaster Recovery Payment [AGDRP]. If this is the case, they are then also able to claim the DRA. As for which LGAs the payment covers, residents from the following who felt the floods’ impact should look into it: Bayside, Blacktown, Blue Mountains, Camden, Campbelltown, Canterbury Bankstown, Central Coast, Cessnock, Cumberland, Dungog, Fairfield, Georges River, Hawkesbury, Hornsby, Kempsey, Kiama, Lake Macquarie, Lithgow, Liverpool, Maitland, Mid-Coast, Muswellbrook, Nambucca Valley, Narromine, Newcastle, Northern Beaches, Oberon, Parramatta, Penrith, Port Macquarie-Hastings, Port Stephens, Randwick, Shellharbour, Shoalhaven, Singleton, Strathfield, Sutherland, The Hills, Upper Lachlan, Warren, Wingecarribee, Wollondilly, and Wollongong. New South Wales residents who are eligible only have until April 5 to make their claim. To check your eligibility status, <a href="https://www.servicesaustralia.gov.au/who-can-get-new-south-wales-floods-july-2022-australian-government-disaster-recovery-payment?context=62849">head to Service Australia</a>. Images: Getty

Money & Banking

Husband ordered to pay for 25 years of unpaid housework

A man has been ordered to pay his ex-wife a hefty six-figure sum for 25 years of unpaid domestic labour. Ivana Moral's ex-husband was ordered to pay her 204,624€ - or just over $327,000 AUD - in a record divorce settlement, based on the average minimum wage throughout their marriage. The separated couple, who live in Spain and share two daughters, took the issue to court as the ruling stated that Ivana had spent almost all of her time looking after their family and working as a housewife during their marriage. Ivana's husband must also pay her a pension of $797 (AUD) per month as well as $639 and $957 to his two daughters, who are now aged 20 and 14, for compensation for their childhoods. The mother-of-two, who married her ex in 1995 before asking for a divorce in 2020, has said she is happy with the payout after years of hard work. "Clearly this was a case of abuse to be completely excluded financially (by my ex-husband) with nothing left after my marriage ended, so me and my daughters were left with nothing after all these years of putting all my time, energy and love in the family," she told <a href="https://inews.co.uk/news/woman-payout-unpaid-housework-record-divorce-settlement-2193153" target="_blank" rel="noopener">inews</a>. "I was supporting my husband in his work and in the family as a mother and a father. I was never allowed access to his financial affairs; everything was in his name." Since getting married and starting a family, Ivana had dedicated herself "to essentially working in the home, which meant looking after the home and the family and all that involves," the court ruling said. The couple's marriage was governed by a separation of property regime, which Ms Moral's husband had asked her to sign at the start of their marriage, which is similar to a pre-nuptial agreement. It specified that whatever each party earned was theirs alone, with them only sharing possessions, which would have left Ms Moral with no access to any of the wealth acquired through years of partnership. Ivana said her husband "made me take on the specific role" of doing domestic chores, to the extent that "I was in a place where I couldn't really do much else." She also said the sentence had made her "very happy" because it was "very well deserved". Image credits: Malaga Tribune

Legal

Record boost to Centrelink payments coming for nearly one million Aussies

Hundreds of thousands of Australians receiving welfare are due to receive the biggest increase to their payments in two decades. The increase will see payments for young people, including parents, students and those on disability, increase from January 1, 2023. From next year, the base rate for singles on Youth Allowance will increase by at least $19.10 - with a maximum $32.40 extra a fortnight - taking the maximum rate up to $569.80. Single Australians with dependents can expect a boost of $41.40, bringing payments up to $729.60, while couples will receive an additional $35.20 a fortnight. For those under 21 without kids who receive Disability Support Pension, including Youth Disability Supplement, the payment increase is expected to range between $27.40 and $40.70 a fortnight. Recipients of Austudy, ABSTUDY, Mobility Allowance, Double Orphan Pension, Carer Allowance and Pharmaceutical Allowance will also be included in the increases, which are part of a routine indexation that happens every January to keep up with inflation. It comes after the Reserve Bank of Australia forecasted that inflation would peak at eight percent by the end of 2022. In comparison, payments for young people and students have been indexed at 6.1 percent. Social services minister Amanda Rishworth said the increase would help ease the pressure coming from the current cost-of-living crisis. “With the cost of living increasing, we need to ensure students and young people can cover basic costs while focusing on their studies and career aspirations,” she said. While young people are the subject of these payment increases, those who receive Jobseeker or the Aged Pension won’t be left out, with indexation increases announced for all welfare payments were announced by the federal government in September. These payments are also indexed at other times of the year, with the Aged Pension increasing in March and September. Image: Getty Images

Money & Banking

Which Centrelink payments are going up from July 1

From July the 1st, over 1.4 million Australian families will benefit from an increase to their Centrelink payments. The federal government has announced increases to the Family Tax Benefit (Part A and B) to keep up with the rising cost of living. Under the Family Tax Benefit Part A, payments for families with a child aged under 13 will increase up to $204.40 over 2022-2023. The payments will also increase by a maximum of $255.50 for families with a child 13 years and older. For those receiving Family Tax Benefit Part B, there will be an increase of as much as $164.25 per year where a family has their youngest child under 5. For those families on Family Tax Benefit Part B with a youngest child aged between five to eighteen will receive up to $116.80 more per year. The changes are expected to impact more than 1.4 million families, Social Services Minister Amanda Rishworth said. It was also announced that the amount of income or assets an Age Pension, Disability Support Pension or Carer Payment recipient can have before their payment is affected will increase. “Social security and family payments have a built-in safeguard where they are automatically indexed at regular intervals to help them maintain purchasing power,” Rishworth said. Those who receive other family payments, such as Multiple Birth Allowance and Newborn Supplement are also set to receive an increase. Image: Getty

Money & Banking

Buy now, pay later: Apple will now lend you money to keep you spending and expand its empire

Apple has joined the thriving “buy now, pay later” industry, with a customised service called <a href="https://www.cnbc.com/video/2022/06/06/apple-announces-buy-now-pay-later-program-called-apple-pay-later.html" target="_blank" rel="noopener">Apple Pay Later</a>. The service was announced earlier this week at the 2022 Worldwide Developers Conference, and will initially be launched in the United States later <a href="https://www.macrumors.com/2022/06/07/apple-pay-later-purchases-installment-plan/" target="_blank" rel="noopener">this year</a>. Pay Later will be built into the Apple Wallet and eligible for use on any purchase made through Apple Pay. Customers will be able to split the cost of a purchase into four equal payments, with zero interest and fees, spread over a period of <a href="https://www.theguardian.com/technology/2022/jun/06/apple-redesigns-the-iphone-lock-screen-in-ios-16-at-wwdc" target="_blank" rel="noopener">four months</a>. To qualify, however, Apple will first do a <a href="https://www.zdnet.com/finance/banking/wwdc-2022-buy-now-pay-later-with-apples-new-wallet-feature/" target="_blank" rel="noopener">soft credit check</a> on users wanting to use the service. The technology behemoth <a href="https://www.apple.com/newsroom/2022/06/apple-unveils-new-ways-to-share-and-communicate-in-ios-16/" target="_blank" rel="noopener">claims</a> it has designed the feature with “users’ financial health in mind”. It’s likely Apple is trying to consolidate its foothold in the world of consumer finance, and increase its profitability. And consumers should be aware of the risks of using such a service. Apple: the consumer darling With the launch of Pay Later, Apple will be competing with many other similar fin-tech companies including PayPal, Block, Klarna and AfterPay – some of which saw their share prices <a href="https://www.bloomberg.com/news/articles/2021-07-13/apple-goldman-plan-buy-now-pay-later-service-to-rival-paypal" target="_blank" rel="noopener">fall</a> following Apple’s announcement. Apple will benefit from its huge market and brand power, with the capability to attract millions to its products and services. And with an acute focus on customer experience, Apple has managed to foster a community of evangelists. There’s no doubt the company is a <a href="https://www.forbes.com/sites/christinemoorman/2018/01/12/why-apple-is-still-a-great-marketer-and-what-you-can-learn/?sh=55e3c32c15bd" target="_blank" rel="noopener">consumer darling</a>. Moreover, Apple has established an ever-growing ecosystem in which users are encouraged to tap into Apple products and services as much, and as often, as possible – such as by making payments through their iPhone instead of a bank card. The tech giant provides ways to integrate once-separate computing capabilities into a phone or wristwatch – while keeping the <a href="https://www.forbes.com/sites/christinemoorman/2018/01/12/why-apple-is-still-a-great-marketer-and-what-you-can-learn/?sh=7c61018615bd" target="_blank" rel="noopener">consumer’s experience</a> in focus. Pay Later enhances this customer-centric experience further. It’s one more way users can integrate the tools they need within a single ecosystem. What’s in it for Apple? Apple stands to make financial gains through Pay Later, thereby adding to its bottom line. Currently its reach in the retail world is evident, with iPhone-based payment services <a href="https://www.bloomberg.com/news/articles/2021-07-13/apple-goldman-plan-buy-now-pay-later-service-to-rival-paypal" target="_blank" rel="noopener">accepted by 85% of US retailers</a>. One 2021 survey found that about 26% of <a href="https://www.statista.com/statistics/1275393/australia-share-of-consumers-using-bnpl-by-purchase-category/" target="_blank" rel="noopener">regular online shoppers</a> in Australia used buy now, pay later services. As Apple’s customers increasingly start to use the Pay Later service, it will gain from merchant fees. These are fees which retailers pay Apple in exchange for being able to offer customers Apple Pay. In addition, Apple will also gain valuable insight into consumers’ purchase behaviours, which will allow the company to predict future consumption and spending behaviour. To deliver the buy now, pay later service, Apple has <a href="https://www.bloomberg.com/news/articles/2021-07-13/apple-goldman-plan-buy-now-pay-later-service-to-rival-paypal" target="_blank" rel="noopener">joined forces with Goldman Sachs</a>, who will finance the loans. This relationship has been in place since 2019, with Goldman Sachs also acting as a partner for the Apple credit card (although Pay Later is not tied to the Apple credit card). This strategic partnership has helped Apple gain strong footing in the world of consumer finance. Challenges for consumers The reality is that the world of <a href="https://www.holmanwebb.com.au/blog/655/buy-now-pay-later-bnpl-update-how-to-seek-and-keep-code-compliance-accreditation" target="_blank" rel="noopener">unregulated finance</a>, which includes buy now, pay later, does not bode well <a href="https://ndh.org.au/debt-problems/buy-now-pay-later/risks-of-using-buy-now-pay-later/" target="_blank" rel="noopener">for all customers</a>. Younger <a href="https://www.emarketer.com/content/almost-75-of-bnpl-users-us-gen-z-millennials" target="_blank" rel="noopener">demographics</a> (such as Gen Z and Millenials) and low-income <a href="https://thefintechtimes.com/one-in-four-bnpl-users-are-financially-vulnerable/" target="_blank" rel="noopener">households</a> can be <a href="https://www.cnbc.com/2021/08/07/why-millennials-and-gen-zs-are-jumping-on-the-buy-now-pay-later-trend.html" target="_blank" rel="noopener">more vulnerable</a> to the risks associated with using these services – and can rack up debt as a result. Purchases through buy now, pay later schemes may also be driven by a desire to own the latest <a href="https://www.cnbc.com/2021/12/16/chinas-buy-now-pay-later-market-to-grow-challenges-ahead-experts.html" target="_blank" rel="noopener">gadgets and luxury goods</a> – a message pushed onto consumers through slick marketing. They can condition consumers to make purchases without feeling the pain of parting with cold, hard cash. <figure class="align-center zoomable"><a href="https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img src="https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" srcset="https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/467674/original/file-20220608-24-ict1mh.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" alt="An indoor shopping arcade is lined with luxury stores on either side" /></a><figcaption>Buy now, pay later schemes can give consumers the satisfaction of buying expensive products – without feeling like they’re splitting from cold, hard cash. Shutterstock</figcaption></figure> From a consumer psychology perspective, these services encourages immediate gratification and put younger people on the consumption treadmill. In other words, they may continually spend more money on purchases than they can actually afford. Missing payments on Pay Later would negatively impact an individual’s <a href="https://www.zdnet.com/finance/banking/wwdc-2022-buy-now-pay-later-with-apples-new-wallet-feature/" target="_blank" rel="noopener">credit rating</a>, which can then have adverse outcomes such as <a href="https://www.cnbc.com/select/side-effects-of-bad-credit/" target="_blank" rel="noopener">not qualifying</a> for traditional loans or credit cards. A focus on consumerist behaviour can also trigger an “<a href="https://www.psychologytoday.com/au/blog/the-psychology-deciding/202201/if-i-own-it-it-must-be-good-what-is-the-ownership-effect" target="_blank" rel="noopener">ownership effect</a>”. This is when people become attached to their purchases and are unlikely to return them, even if they can’t afford them. Apple’s technology-driven and consumer-centric marketing gives it an edge over other buy now, pay later schemes. It claims the service is designed with consumers’ financial health in mind. But as is the case with any of these services, consumers ought to be aware of the risks and manage them carefully. <img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/184550/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/rajat-roy-1227884" target="_blank" rel="noopener">Rajat Roy</a>, Associate Professor, Bond Business School, <a href="https://theconversation.com/institutions/bond-university-863" target="_blank" rel="noopener">Bond University</a> This article is republished from <a href="https://theconversation.com" target="_blank" rel="noopener">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/buy-now-pay-later-apple-will-now-lend-you-money-to-keep-you-spending-and-expand-its-empire-184550" target="_blank" rel="noopener">original article</a>. Image: Getty Images

Technology

Pay ‘with a smile or a wave’: Why Mastercard’s new face recognition payment system raises concerns

Mastercard’s <a href="https://www.mastercard.com/news/press/2022/may/with-a-smile-or-a-wave-paying-in-store-just-got-personal/" target="_blank" rel="noopener">“smile to pay”</a> system, announced last week, is supposed to save time for customers at checkouts. It is being trialled in Brazil, with future pilots planned for the Middle East and Asia. The company argues touch-less technology will help speed up transaction times, shorten lines in shops, heighten security and improve hygiene in businesses. But it raises concerns relating to customer privacy, data storage, crime risk and bias. How will it work? Mastercard’s biometric checkout system will provide customers facial recognition-based payments, by linking the biometric authentication systems of a number of third-party companies with Mastercard’s own payment systems. A Mastercard spokesperson told The Conversation it had already partnered with NEC, Payface, Aurus, Fujitsu Limited, PopID and PayByFace, with more providers to be named. <figure class="align-center zoomable"><a href="https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img src="https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" srcset="https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/464953/original/file-20220524-22-ga0v7l.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" alt="The 'Fujitsu' logo in red is displayed on a building's side" /></a><figcaption>Mastercard has partnered with Fujitsu, a massive information and communications technology firm offering many different products and services. Shutterstock</figcaption></figure> They said “providers need to go through independent laboratory certification against the program criteria to be considered” – but details of these criteria aren’t yet publicly available. According to <a href="https://www.siliconrepublic.com/business/mastercard-facial-recognition-biometric-payments" target="_blank" rel="noopener">media</a> reports, customers will have to install an app which will take their picture and payment information. This information will be saved and stored on the third-party provider’s servers. At the checkout, the customer’s face will be matched with the stored data. And once their identity is verified, funds will be deducted automatically. The “wave” option is a bit of a trick: as the customer watches the camera while waving, the camera still scans their face – not their hand. Similar authentication technologies are used on smartphones (face ID) and in many airports around the world, including “<a href="https://www.abf.gov.au/entering-and-leaving-australia/smartgates/arrivals" target="_blank" rel="noopener">smartgates</a>” in Australia. <a href="https://www.theverge.com/2017/9/4/16251304/kfc-china-alipay-ant-financial-smile-to-pay" target="_blank" rel="noopener">China</a> started using biometrics-based checkout technology back in 2017. But Mastercard is among the first to launch such a system in Western markets – competing with the “pay with your palm” <a href="https://techcrunch.com/2020/09/29/amazon-introduces-the-amazon-one-a-way-to-pay-with-your-palm-when-entering-stores/" target="_blank" rel="noopener">system</a> used at cashier-less Amazon Go and Whole Foods brick and mortars in the United States. What we don’t know Much about the precise functioning of Mastercard’s system isn’t clear. How accurate will the facial recognition be? Who will have access to the databases of biometric data? A Mastercard spokesperson told The Conversation customers’ data would be stored with the relevant biometric service provider in encrypted form, and removed when the customer “indicates they want to end their enrolment”. But how will the removal of data be enforced if Mastercard itself can’t access it? Obviously, privacy protection is a major concern, especially when there are many potential third-party providers involved. On the bright side, Mastercard’s <a href="https://www.investopedia.com/articles/markets/032615/how-mastercard-makes-its-money-ma.asp" target="_blank" rel="noopener">customers</a> will have a choice as to whether or not they use the biometrics checkout system. However, it will be at retailers’ discretion whether they offer it, or whether they offer it exclusively as the only payment option. Similar face-recognition technologies used in airports, and <a href="https://www.brookings.edu/research/police-surveillance-and-facial-recognition-why-data-privacy-is-an-imperative-for-communities-of-color/" target="_blank" rel="noopener">by police</a>, often offer no choice. We can assume Mastercard and the biometrics provider with whom they partner will require customer consent, as per most privacy laws. But will customers know what they are consenting to? Ultimately, the biometric service providers Mastercard teams up with will decide how they use the data, for how long, where they store it, and who can access it. Mastercard will merely decide what providers are “good enough” to be accepted as partners, and the minimum standards they must adhere to. Customers who want the convenience of this checkout service will have to consent to all the related data and privacy terms. And as reports have noted, there is potential for Mastercard to integrate the feature with loyalty schemes and make personalised recommendations <a href="https://www.cnbc.com/2022/05/17/mastercard-launches-tech-that-lets-you-pay-with-your-face-or-hand.html" target="_blank" rel="noopener">based on purchases</a>. Accuracy is a problem While the accuracy of face recognition technologies has previously been challenged, the current best facial authentication algorithms have an error of just 0.08%, according to tests by the <a href="https://github.com/usnistgov/frvt/blob/nist-pages/reports/1N/frvt_1N_report_2020_03_27.pdf" target="_blank" rel="noopener">National Institute of Standards and Technology</a>. In some countries, even banks have <a href="https://techhq.com/2020/09/biometrics-the-most-secure-solution-for-banking/" target="_blank" rel="noopener">become comfortable</a> relying on it to log users into their accounts. Yet we can’t know how accurate the technologies used in Mastercard’s biometric checkout system will be. The algorithms underpinning a technology can work almost perfectly when trailed in a lab, but perform <a href="https://www.csis.org/blogs/technology-policy-blog/how-accurate-are-facial-recognition-systems-%E2%80%93-and-why-does-it-matter" target="_blank" rel="noopener">poorly</a> in real life settings, where lighting, angles and other parameters are varied. Bias is another problem In a 2019 study, NIST <a href="https://nvlpubs.nist.gov/nistpubs/ir/2019/NIST.IR.8280.pdf#page=5" target="_blank" rel="noopener">found</a> that out of 189 facial recognition algorithms, the majority were biased. Specifically, they were less accurate on people from racial and ethnic minorities. Even if the technology has improved in the past few years, it’s not foolproof. And we don’t know the extent to which Mastercard’s system has overcome this challenge. If the software fails to recognise a customer at the check out, they might end up disappointed, or even become irate – which would completely undo any promise of speed or convenience. But if the technology misidentifies a person (for instance, John is recognised as Peter – or <a href="https://www.youtube.com/watch?v=e8-yupM-6Oc" target="_blank" rel="noopener">twins are confused</a> for each other), then money could be taken from the wrong person’s account. How would such a situation be dealt with? <figure class="align-center zoomable"><a href="https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img src="https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" srcset="https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=617&fit=crop&dpr=1 600w, https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=617&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=617&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=776&fit=crop&dpr=1 754w, https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=776&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/464424/original/file-20220520-19-5hfuvx.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=776&fit=crop&dpr=3 2262w" alt="" /></a><figcaption>There’s no evidence facial recognition technology is infallible. These systems can misidentify and also have biases. Shutterstock</figcaption></figure> Is the technology secure? We often hear about software and databases being hacked, even in <a href="https://www.csoonline.com/article/2130877/the-biggest-data-breaches-of-the-21st-century.html" target="_blank" rel="noopener">cases of</a> supposedly very “secure” organisations. Despite Mastercard’s <a href="https://wwmastw.cnbc.com/2022/05/17/mastercard-launches-tech-that-lets-you-pay-with-your-face-or-hand.html" target="_blank" rel="noopener">efforts</a> to ensure security, there’s no guarantee the third-party providers’ databases – with potentially millions of people’s biometric data – won’t be hacked. In the wrong hands, this data could lead to <a href="https://www.comparitech.com/identity-theft-protection/identity-theft-statistics/" target="_blank" rel="noopener">identity theft</a>, which is one of the fastest growing types of crime, and financial fraud. Do we want it? Mastercard suggests 74% of customers are in favour of using such technology, referencing a stat from its <a href="https://www.mastercard.com/news/ap/en/newsroom/press-releases/en/2020/april/mastercard-study-shows-consumers-moving-to-contactless-payments-for-everyday-purchases/" target="_blank" rel="noopener">own study</a> – also used by <a href="https://www.mastercard.com/news/ap/en/newsroom/press-releases/en/2020/october/mastercard-idemia-and-matchmove-pilot-fingerprint-biometric-card-in-asia-to-enhance-security-and-safety-of-contactless-payments" target="_blank" rel="noopener">business partner</a> Idemia (a company that sells biometric identification products). But the report cited is vague and brief. Other studies show entirely different results. For example, <a href="https://www.getapp.com/resources/facial-recognition-technology/#how-comfortable-are-consumers-with-facial-recognition-technology" target="_blank" rel="noopener">this study</a> suggests 69% of customers aren’t comfortable with face recognition tech being used in retail settings. And <a href="https://www.securitymagazine.com/articles/93521-are-consumers-comfortable-with-facial-recognition-it-depends-says-new-study" target="_blank" rel="noopener">this one</a> shows only 16% trust such tech. Also, if consumers knew the risks the technology poses, the number of those willing to use it might drop even lower.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important;" src="https://counter.theconversation.com/content/183447/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/rita-matulionyte-170113" target="_blank" rel="noopener">Rita Matulionyte</a>, Senior Lecturer in Law, <a href="https://theconversation.com/institutions/macquarie-university-1174" target="_blank" rel="noopener">Macquarie University</a> This article is republished from <a href="https://theconversation.com" target="_blank" rel="noopener">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/pay-with-a-smile-or-a-wave-why-mastercards-new-face-recognition-payment-system-raises-concerns-183447" target="_blank" rel="noopener">original article</a>. Image: Getty Images

Technology

Queensland couple mistakenly charged $15k for flights to Melbourne

A couple looking forward to going on their much needed holiday have been instead wrongly charged $15,000. Dennis and Pat Amor from Queensland were organising a trip to Melbourne to visit some family after two years of no flights thanks to the pandemic. The pair called Qantas to help book the tickets and provided their credit card details – but were instead informed that their booking was rejected. Pat however revealed that their booking was in fact not rejected and that the Qantas staff member had instead processed it 15 times. "It's never declined and she apparently tried to push it over and over again,” she told <a href="https://9now.nine.com.au/a-current-affair/queensland-couple-15000-dollar-qantas-bill-booking-error/b9dcb551-90d3-437c-8ed0-e36117cdd0a7" target="_blank" rel="noopener">A Current Affair</a>. The horrified couple had to check with Mastercard to see what the issue was and were shocked to find they were charged 15 times for the flights. "They just said there was a bill of $15,000 on the card, being 15 transactions had gone through, so we were really flummoxed," Pat revealed. They tried to get in touch with Qantas once again and time after time were unable to get through. Eventually, a staff member got in touch who said they would sort it out with the finance team and call them later that day. They didn’t. Mastercard however has since returned $11,000 of the couple’s money – but at the time of writing, $4,000 remains outstanding. Qantas claims that the issue is with the Amor’s credit card and not with them, which Mastercard has refuted. To top it off, the upset couple were told they could not fly Qantas until the matter was resolved and were required to use leftover credit from Jetstar to book their tickets. "It doesn't seem fair to us. We are frustrated. We are angry." Image: A Current Affair

Travel Trouble

ALDI shoppers left fuming

An alert on ALDI’s self-serve checkouts prompting shoppers to only pay by card has left customers fuming. A photo shared to popular Facebook page, Aldi Fans Australia, shows the supermarket’s self-serve screen with the words “Card payment only” on it. The self-serve checkouts were installed in nine stores across New South Wales in June 2021 - but that’s not what’s got customers annoyed. Customers said they would not be shopping at ALDI if they did not accept cash options. “No cash, no buy - so bye bye. Cash only here,” one customer said. “I pay for everything with cash. Cash is king,” another wrote. “I'd rather use a human being, thanks, and keep someone in a job,'' one woman said. “I used to get paid to do that job, now they want me to do it for free,” someone else commented. “I would prefer cash any day, at least I know where it is,” another added. On the other hand, shoppers commended the introduction of the self-serve checkouts which will help them complete their trip quicker. “Now we can go at our own pace,” one commented. “This makes me super happy. Love self-serve,” another added. “'I never have cash, I have almost forgotten it's a thing, doesn't everyone just use their phone to pay for stuff now?” someone else wrote. Images: Facebook/Shutterstock

Food & Wine

What a disaster: federal government slashes COVID payment when people need it most

With Australia’s official COVID-19 infection numbers topping <a href="https://www.nytimes.com/interactive/2021/world/australia-covid-cases.html">100,000 a day</a>, the federal government has slashed its last remaining pandemic support payment. The decision is ill-timed, irresponsible and heartless. It is stripping away support for those most affected by the pandemic at the time they need it most. It will place those in low paid and precarious work in further financial stress as they lose income to isolate when infected or in close contact with someone else with COVID-19. The Pandemic Leave Disaster Payment was introduced in August 2020 in response to concerns casual workers and others without sick or pandemic leave entitlements could not take time off work when infected or in contact with someone with COVID-19. The leave payment was initially available to those not qualifying for JobKeeper – or, after JobKeeper ended in March 2021, the “disaster payment” introduced in response to <a href="https://theconversation.com/support-package-for-sydney-better-and-more-fit-for-purpose-than-jobkeeper-164394">the Sydney lockdown</a> in July 2021. Since that payment ended the Pandemic Leave Disaster Payment is the only individual financial support the federal government provides. Available to people who had contracted COVID, were a close contact or needed to care for someone who had COVID, until this week it paid A$750 a week for two weeks. You could claim the payment regardless of the number of hours of paid work you lost. On January 18 the rules tightened – a move announced via a <a href="https://ministers.pmc.gov.au/mckenzie/2022/changes-pandemic-leave-disaster-payment">press release </a> on January 8 (a Saturday). Now it only pays $750 if you lose 20 hours or more of paid work a week. If you lose 8-19 hours you get just $450 a week. If you lose less than eight hours you get nothing. Getting the payment has also been made more difficult by imposing a 14-day time limit to apply, from the start of the isolation period. To qualify, you must show evidence of a positive PCR or rapid antigen test. Considering the difficulty of obtaining RATs, and delays in PCR test results <a href="https://www.smh.com.au/politics/victoria/test-samples-no-longer-suitable-after-seven-day-wait-20220108-p59ms1.html">of a week or more</a>, this is a unreasonable and unnecessary constraint. <h2>Flawed eligibility rules</h2> A major flaw in the eligibility rules for the leave payment it is not available to people receiving social security payments. This excludes all JobSeeker recipients, despite about <a href="https://data.gov.au/data/dataset/dss-payment-demographic-data/resource/80cc89a3-3208-4e0d-9745-598f7a882e28">one in four</a> being in some form of paid work – generally low-paid casual jobs. The leave payment has been a vital part of the economic supports to help people stay safe and protect their loved ones and the community. The peak body for the community services sector, the Australian Council of Social Service, has <a href="https://www.acoss.org.au/media-releases/?media_release=another-income-hit-for-casual-workers-massive-cut-to-pandemic-leave-disaster-payment">condemned this decision</a>. It says cutting the payment will leave people without enough to cover basic costs, let alone the extra costs of isolation such as delivery fees, rapid tests (if you can get them) and personal protective equipment. <h2>Worst time possible</h2> There could scarcely be a worse time to cut this payment, with Australia now in the worst stage of the pandemic. Between August 5 2020 and July 8 2021 the Pandemic Leave Disaster Payment provided <a href="https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp2122/Quick_Guides/COVID-19DisasterPayments">almost 15,000 grants</a> to support those in need. During this period the peak COVID case rate was just over 500 day, in August 2020. Consider, therefore, the likely need now we’re at more than <a href="https://www.nytimes.com/interactive/2021/world/australia-covid-cases.html">100,000 a day</a>. With no other form of federal income support available you may apply for an unemployment or sickness payment like JobSeeker. But Services Australia advises this will be paid about <a href="https://www.servicesaustralia.gov.au/when-youll-get-your-first-jobseeker-payment?context=51411">two weeks after</a> a claim is granted. That is of little help to cover rent while you’re isolating with COVID. JobSeeker is also a maximum of $315 a week – inadequate to cover basic costs. This cut will affect many of the same people <a href="https://www.dailytelegraph.com.au/news/national/pm-announces-national-day-of-thanks-for-pandemic-heroes/news-story/174c8ccb94814aaa554d79eea0193e4f">lauded as the heroes of pandemic</a> – essential workers employed casually in health and aged care, supermarkets, hospitality venues and warehouses. It will also hurt temporary visa holders, who are entitled to the leave payment and do not qualify for any other federal income support. Last week <a href="https://www.acoss.org.au/media-releases/?media_release=community-sector-calls-for-collaboration-and-decisive-leadership-from-national-cabinet-to-deal-with-covid-debacle">ACOSS called for</a> the establishment of a civil society COVID Rapid Response Group to work alongside National Cabinet. We need the interests of people most at risk in the room at the highest levels when decisions like the future of the Pandemic Leave Disaster Payment are made. Cutting this payment now is effectively telling low-paid workers at the worst stage of the pandemic in Australia that they’re on their own.<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/175146/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/cassandra-goldie-94635">Cassandra Goldie</a>, Adjunct Professor and UNSW Law Advisory Council Member, <a href="https://theconversation.com/institutions/unsw-1414">UNSW</a> This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/what-a-disaster-federal-government-slashes-covid-payment-when-people-need-it-most-175146">original article</a>. Image: Mick Tsikas/AAP

Retirement Income

Overhaul of payments system to cover digital wallets, buy now pay later, cryptocurrency

Treasurer Josh Frydenberg will announce on Wednesday a comprehensive reform of regulations governing the payments system, to bring it up to date with innovations such as digital wallets and cryptocurrency. The government says without the changes – the biggest in 25 years – Australians businesses and consumers could increasingly be making transactions in spaces beyond the full reach of Australian law, where rules were determined by foreign governments and multinationals. It points out that in three decades payment methods have gone from cash to cheques, cheques to credit cards, credit cards to debit cards and now to “tap and go” via digital wallets on phones or watches. Around a decade ago, cryptocurrency was a concept. Currently, there are more than 220 million participants in the worldwide crypto market, including many in Australia. The planned reforms will centralise oversight of the payment system by ensuring government plays a greater leadership role. The treasurer will be given more power to intervene in certain circumstances. Consumer protection will be strengthened, and more competition and innovation will be promoted. The reform program will be in two phases. There will be consultations in the first half of next year on those that are most urgent and easy to implement. Consultations on the rest will be done by the end of the year. The government says the present one-size-fits-all licensing framework for payment service providers will be replaced graduated, risk-based regulatory requirements. There will be consideration of the feasibility of a retail central bank digital currency, and an examination of “de-banking” (where a bank declines to offer a service to a business or individual). Frydenberg says the comprehensive payments and crypto asset reform program would “firmly place Australia among a handful of lead countries in the world. "It is how we will capitalise on the opportunity for Australia to lead the world in this emerging and fast-growing area which has almost endless potential applications across the economy,” he says. “For businesses, these reforms will address the ambiguity that can exist about the regulatory and tax treatment of crypto assets and new payment methods. "In doing so, it will drive even more consumer interest, facilitate even more new entrants and enable even more innovation to take place. "For consumers, these changes will establish a regulatory framework to underpin their growing use of crypto assets and clarify the treatment of new payment methods.”<img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/173331/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /> <a href="https://theconversation.com/profiles/michelle-grattan-20316">Michelle Grattan</a>, Professorial Fellow, <a href="https://theconversation.com/institutions/university-of-canberra-865">University of Canberra</a> This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/overhaul-of-payments-system-to-cover-digital-wallets-buy-now-pay-later-cryptocurrency-173331">original article</a>. Image: Shutterstock

Retirement Income

"Cold and brutal": Karl grills treasurer over scrapping of disaster payments

Today Show co-host Karl Stefanovic has criticised the federal government over its plan to scale back, and eventually scrap, COVID-19 disaster payments. It was announced on Tuesday that the government will begin winding down the payments, which give $750 a week to people who have lost at least 20 hours of work, and $450 a week to those who have lost between eight and 20 hours, as each state and territory reaches their 70 and 80 per cent vaccination targets. Per the changes, once a state or territory reaches 70 per cent fully vaccinated, people will have to reapply each week for the payment, instead of it being automatically renewed. At 80 per cent, the payment will be phased out entirely within two weeks. For states and territories like NSW or the ACT, which are <a href="https://twitter.com/CaseyBriggs/status/1442700206420549636/photo/1">estimated</a> to reach 80% fully vaccinated by October 18th and 21st respectively, this change means the scrapping of the payment is imminent. Talking to treasurer Josh Frydenberg on the Today Show on Wednesday morning, co-host Karl Stefanovic called the decision “cold and brutal”, telling Frydenberg, “I get that you can’t keep it going and going but many industries won’t be back to normal at 70 or 80 per cent – you have the arts, nightclub, hospitality and tourism, especially in Far North Queensland … to cut them off is kind of cold and brutal, isn’t it?” <blockquote class="twitter-tweet"> “We can't continue with these emergency payments indefinitely.” The Federal Government will announce today that COVID disaster payments will be wound back as each state hits the 80 per cent double-dosed vaccination target. <a href="https://twitter.com/hashtag/9Today?src=hash&ref_src=twsrc%5Etfw">#9Today</a> <a href="https://t.co/jHMFvZtDSH">pic.twitter.com/jHMFvZtDSH</a> — The Today Show (@TheTodayShow) <a href="https://twitter.com/TheTodayShow/status/1442976255402340363?ref_src=twsrc%5Etfw">September 28, 2021</a></blockquote> In response, Frydenberg outlined the government’s partnership with the Queensland Government to support Queensland businesses, concluding that, “It’s those sorts of direct economic payments that complement what we’ve been doing at higher, broader level with the Covid disaster payment and other economic support.” Frydenberg failed to address how the federal government would provide support to those who have lost work as a result of COVID-19 and are not able to find replacement work in between now and the looming deadline. Many anti-poverty advocates and welfare campaigners expressed concern about the phasing out of the payments online, including the Antipoverty Centre, who tweeted, “They’re making a huge gamble with our lives, betting that jobs will magically return overnight.” <blockquote class="twitter-tweet"> The government has started the poverty clock ticking. They’re making a huge gamble with our lives, betting that jobs will magically return overnight. All that will come of this is more people in poverty and more lives destroyed. The disaster payment living up to its name. <a href="https://t.co/LtwzgMXotU">https://t.co/LtwzgMXotU</a> — The Antipoverty Centre (@antipovertycent) <a href="https://twitter.com/antipovertycent/status/1442856771341664264?ref_src=twsrc%5Etfw">September 28, 2021</a></blockquote> Image: TODAY Show/Nine

Money & Banking

Pension payment increase labelled "inadequate"

Over five million Australians are expected to receive an increase in their social security payments from March 20. Minister for Families and Social Services Anne Ruston said the increases, in line with indexation arrangements, would help recipients keep up with changes in living costs. The rates for 2.6 million Age Pensioners as well as 750,000 people on the Disability Support Pension and 295,000 Carer Payment recipients will increase by $8.40 a fortnight to $952.70 for singles. For couples, the pension will increase by $12.60 a fortnight to $1,436.20 combined. Both rates include the Pension Supplement and Energy Supplement. Ruston explained indexation was one of the “regular mechanisms” built into the social security safety net “to make sure rates reflect the prices payment recipients see at the supermarket and at the bowser”. The JobSeeker payment will also be increasing for those aged 22 and over without children. Singles will be receiving an extra $5.10 a fortnight, and couples will be receiving $4.60 extra each including the Energy Supplement. The Australian Council of Social Service believes the rate is still inadequate and is urging senators to make changes to a bill before parliament to be more generous.

Retirement Life

Loophole in JobKeeper payments worries tax experts

A large loophole has been found in the assessment process for the JobKeeper payment that tax experts worry could be exploited by hundreds of thousands of Aussies. In order to receive the full $1,200 per fortnight in wage support, sole traders will need to show the Tax Office they were working more than 20 hours per week in the reference period. However the reference period is between the two fortnightly pay periods prior to either March 1, 2020 or July 1, 2020 - whichever had the higher hours worked. The activity test given to sole traders simply means they need to be "actively engaged in the business" for 20 hours a week to receive the full JobKeeper rate. However Chartered Accountants tax lead Michael Croker told <a rel="noopener" href="https://www.abc.net.au/news/2020-09-08/jobkeeper-loophole-will-tempt-sole-traders-into-rorts/12638334" target="_blank">ABC news</a> that "What you're pointing out is a tempting opportunity.” . Chartered Accountants represents 120,000 number crunchers around the country. The profession is already trying to raise the fact it will be difficult for small businesses and sole traders to rally up their hours of work each fortnight. "The Treasurer announced that for sole traders that they needed to be 'actively engaged in the business' for 20 hours or more per week to get the higher rate," Mr Croker explained. He noted that they would otherwise only be eligible for the part-time rate of $750. "Now, you could be washing the dishes at night and thinking about your business at the same time — that's a very loose test." Mr Crocker says many Australians across the nation will be tempted to rort the system, adding that the JobKeeper system requires a degree of honesty for those applying. "What we expect to see is common sense prevail around this," he said. . "I think to a degree we shouldn't make a mountain out of a molehill here. "We're about the economy and jobs, not about compliance and regulation." ATO has announced in a statement they have a JobKeeper integrity team whose sole purpose is to make sure JobKeeper is going to those who genuinely need it. "We use a range of sophisticated data and behavioural models to identify applications which we will need to review before we make a payment," an ATO spokesperson said in a statement. "We will also continue to review applications after payment cycles to identify any risks and issues which cause us concern."

Money & Banking

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