3. Program logic

Program logic (also referred to as theory of change), has been used to develop and evaluate programs and initiatives since the early 1970s. It improves the quality and focus of evaluation advice to government.

This process is used to ‘surface the implicit theory of action inherent in the proposed intervention in order to delineate what should happen if the theory is correct and to identify short medium and long term indicators of changes which can provide evidence on which to base evaluations' (London et al, 1996).

In order to evaluate NIM it is important to clearly articulate the objectives of the policy and the criteria by which the success or failure of the policy in meeting the objectives set for it are to be evaluated. It is also important for the evaluation methodology to be able to identify any unintended impacts, both positive and negative.

This section outlines the concept map for the NIM model (see Figure 2). A high-level concept map sets out the most important components of the program logic:

• the knowledge base underlying the program
• the strategies to be adopted as part of the program
• the problems to be addressed
• the needs and assets of the communities and
• the influential factors that have an impact on these problems and also on needs and assets, with the desired results to be achieved by the program.2(Opens in a new tab/window)

FaHCSIA has developed its own program logic, and that can be found at Appendix C.

Figure 2. High-level concept map

Influential Factors

• Extensive Review of the Northern Territory Emergency Response.
• Experience and feedback from people on other income management schemes (e.g. VIM, CPSIM, CY).
• Access to services.
• Knowledge of the range of policy levers that influence behaviour and outcomes for welfare recipients.

Knowledge

• Income management is one tool that may assist people to allocate their income more responsibly, and reduce their vulnerability and that of their dependents.
• Passive welfare creates a cycle of dependency.
• Income management can provide a gateway into other initiatives including building money management skills, and leverage for responsible parenting and participation.
• Focusing on priority needs allows issues such as food security, housing and children’s needs to be addressed.
• Previous income management arrangements were discriminatory and required the suspension of the Racial Discrimination Act.

Strategies

Implement income management to:

• ensure appropriate expenditure of income support payments on priority goods
• reduce the amount of income support that is spent on excluded goods
• reduce the amount of harassment, financial abuse and related pressures in relation to welfare payments and
• provide incentives and support for improved financial management skills and practices, workforce and educational participation, and responsible parenting.

Problems/issues for consideration

• Variation in opportunities for economic participation within communities.
• Entrenched welfare dependency and associated issues.
• Low levels of positive social participation and high degree of vulnerability.
• Inadequate spending on priority needs and other poor financial management outcomes including debt and arrears.
• Breakdown in community values and solidarity.
• Need to provide support for the most vulnerable in communities.
• Acknowledging the potential strength of some particular communities, including remote Indigenous Communities.

Desired results

• More spending on priority goods.
• Less spending on excluded goods.
• Reduction in immediate hardship of individuals and families.
• More responsible parenting and better outcomes for children, including nutrition and education.
• Increased financial management skills and capacity to save.
• Greater levels of positive economic and social participation and responsibility.

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3.1 Objectives/rationale of NIM

Objectives for NIM have broadly been taken from Minister Macklin's second reading speech, and the Government's Policy Statement "Landmark Reform to the Welfare System, Reinstatement of the Racial Discrimination Act and Strengthening of the Northern Territory Emergency Response".

The Australian Government's Policy Statement (2009, p. 1) identifies the aims of new income management as to:

"...provide for the welfare of individuals and families, and particularly children…" by ensuring that people meet their immediate priority needs and those of their children and other dependents. Income management can reduce the amount of welfare funds available to be spent on alcohol, gambling, tobacco products and pornography and can reduce the likelihood that a person will be at risk of harassment or financial abuse in relation to their welfare payments.

"Governments have a responsibility – particularly in relation to vulnerable and at risk citizens – to ensure income support payments are allocated in beneficial ways. The Government believes that the first call on welfare payments should be life essentials and the interests of children."

"In the Government's view the substantial benefits that can be achieved for these individuals through income management include: putting food on the table; stabilising housing; ensuring key bills are paid; helping minimise harassment; and helping people save money. In this way, income management lays the foundations for pathways to economic and social participation through helping to stabilise household budgeting that assists people to meet the basic needs of life. We recognise that these are benefits which are relevant to Indigenous people and non-Indigenous people in similar situations."

The policy statement also identifies income management as a key tool in the Government's broader welfare reforms to promote responsibility and strengthen families by ensuring that income support payments are spent where they are intended.

Income management limits expenditure of income support payments on excluded items, including alcohol, tobacco, pornography, gambling goods and activities. It ensures that money is available for life essentials, and provides a tool to stabilise people's circumstances, easing immediate financial stress.

According to the program logic, this change in expenditure patterns is expected to result in a number of other benefits for children, parents and the broader community. A reduction in negative expenditures may result in reductions in alcohol fuelled violence, substance abuse and risky behaviour. The promotion of positive expenditure patterns may result in more effective meeting of children's needs including improved nutrition and increased spending on children's clothing and school-related expenses.

As a consequence of better spending on children, there may be improvements in positive health behaviours and improved educational attendance, which in turn could lead to improved educational outcomes.

In addition, the exemption criteria are intended to reinforce some of these positive outcomes. For example, families may be able to secure exemptions if their children are immunised and if they are attending school. Additionally, exemptions are available on demonstrating that children are engaged in activities such as structured, age appropriate social, learning or physical activities.

Overall, the program is intended to reinforce responsible parenting and more generally promote principles of engagement, participation and personal responsibility.

The Australian Government funds financial counselling services through the Financial Management Program (FMP), which was established to build financial resilience and wellbeing among those most at risk of financial and social exclusion and disadvantage. The Program helps vulnerable people across a range of income and financial literacy levels to manage their money, overcome financial adversity, participate in their communities and plan for the medium to long term.

This Program contributes to improved outcomes for vulnerable people, families, and communities by:

• fostering the improved use and management of money
• helping people address immediate needs in times of financial crisis and
• undertaking research to inform policies to reduce the impact of problem gambling.

The provision of financial counselling through FMP and the new incentives for saving could lead to improved savings and household budgeting, which in turn could result, for example, in the ability to purchase needed consumer durables. Better financial management is intended to assist families in meeting important bills such as rent and utilities, which could in turn stabilise housing and reduce risks of eviction and homelessness or sleeping rough.

It is also expected that certain sorts of child neglect could well be exacerbated by poor household financial management, for example, poor management may mean that children are hungry. It is also anticipated that income management will assist some individuals in resisting undesirable behaviour by their relatives and kin (i.e. harassment for money).

In broad terms, new income management is intended to set in motion a series of positive behaviours that will be mutually reinforcing. Outcomes are therefore expected to be:

• short-term (e.g. changed expenditure patterns—less expenditure on excluded goods, more expenditure on priority items)
• medium-term (e.g. take-up of referrals to money management and financial counselling service providers, improved educational attendance), and
• long-term (e.g. acquisition of money management skills, improved employment opportunities and improved educational attainment).

The potential impacts of the model are not only expected to be felt by the individuals directly affected, but the communities in which these individuals live are also expected to be affected.

As there will be movement onto and off the program, it will be necessary to consider outcomes not only for those who are currently participating in the model, but also for those who have left the model and are no longer having their benefits managed.

2. This approach to the logic model reflects the Logic Model approach developed by the WK Kellogg foundation. This structural approach is further developed in the next section with regard to the identification of the key evaluation questions.