Labor to Mandate Cash Option for Buying Essentials

A woman pays a fruit vendor in a market in Melbourne, Australia, on July 23, 2013. Scott Barbour/Getty Images

The Albanese Labor government will protect the use of cash as legal tender for essential items like groceries, petrol and pharmacy items, under a new plan to ensure the future of cash.

The plan to modernise Australia’s payments system also include moves to phase out cheques by the middle of 2028.

According to the government, a mandate on accepting cash for certain businesses will start in January 2026 after the next federal election.

“What we are doing is, we are trying to modernise the payment system recognising a lot of people prefer to use digital, but making sure that we don’t leave people behind who want to maintain the use of cash,” Treasurer Jim Chalmers said on ABC Radio National on Nov. 18.

The treasurer explained that 1.5 million Australians rely primarily on cash but said most Australians had gone digital.

“But one and a half million is not a small number of people who rely on cash. And so what we are doing, is we are making sure people can pay cash for essential items if they want to, and if they need to,” he said.

Chalmers said the Australian government understood that being able to use cash provided a sense of security.

Australia's Treasurer Jim Chalmers at the National Press Club in Canberra, Australia on May 15, 2024. Tracey Nearmy/Getty Images

“We want to focus on businesses selling essential items like petrol, groceries, pharmacy, and there might be others that we determine as we go through the next part of the consultation,” Chalmers said.

“We want to make sure that we’ve got appropriate carve-outs for small businesses, and we want to make sure that there’s a particular focus on regional Australia. So we want to be reasonable about this, we want to give people choices and options, he said.

The treasurer said about 94 percent of businesses accept cash, down from 99 percent before COVID-19.

“There has been a shift away from cash amongst some businesses, we want to make sure that people still have that option if they need it, or if they want it.”

On the move away from cheques, the treasurer said people had been given “lots of time to prepare.”

Cheque use has declined by 90 percent over the past 10 years.

In response to the cash announcement, the spokesperson for Cash Welcome, Jason Bryce, welcomed the move.

“The government is hearing us! This is exactly what we have been asking for,” he said.

Opposition Says Definition of ‘Essential’ Unclear

Shadow Treasurer Angus Taylor said the government needed to clarify the definition for “essential” items.

“The treasurer can’t say what an essential business is, how it’ll work and who will pay. In the Treasurer’s own words—94 percent of businesses already accept cash,” he told The Epoch Times.

Taylor also took the opportunity to press the government on cost of living and inflation.

“The main game is cost of living, and the treasurer is asleep at the wheel.  This is yet another plan for a plan from an incompetent government which is failing to manage the economy,” the member for Hume said.

“Australians are smarter than this and they can see through a government that has been missing in action on cost of living for more than two years and now comes knocking on the eve of an election with empty promises.”

Treasury Considering Levy for Regional Banking

Meanwhile, recent media reports have flagged a potential new regional bank levy that could tax banks without a presence in rural areas.

Treasurer Chalmers said his department had engaged with the financial sector on a solution to try to maintain a decent level of service for Australians in the bush.

Chalmers said it was no secret that the decline of banking in the regions was a challenge.

“And so it shouldn’t surprise people to hear that we engage pretty regularly with the banks and with others to try and find some solutions here,” he said.

Earlier this year, Bankwest announced it would become a completely digital bank by the end of 2024, while a year earlier, Australian banks closed a total of 424 physical branches.