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In the Shadow of the Welfare State: The Role of Payday Lending in Poverty Survival in Australia

Published online by Cambridge University Press:  11 October 2013

GREG MARSTON  and
LYNDA SHEVELLAR
GREG MARSTON
Affiliation:
School of Public Health and Social Work, Queensland University of Technology, Kelvin Grove campus, Victoria Park Rd, Kelvin Grove QLD 4059 Email: [email protected]
LYNDA SHEVELLAR
Affiliation:
School of Social Work & Human Services, Chamberlain Building, Campbell Road The University of Queensland, St Lucia, 4072 Email: [email protected]
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Abstract

A defining characteristic of contemporary welfare governance in many western countries has been a reduced role for governments in direct provision of welfare, including housing, education, health and income support. One of the unintended consequences of devolutionary trends in social welfare is the development of a ‘shadow welfare state’ (Fairbanks, 2009; Gottschalk, 2000), which is a term used to describe the complex partnerships between state-based social protection, voluntarism and marketised forms of welfare. Coupled with this development, conditional workfare schemes in countries such as the United States, Canada, the UK and Australia are pushing more people into informal and semi-formal means of poverty survival (Karger, 2005). These transformations are actively reshaping welfare subjectivities and the role of the state in urban governance. Like other countries such as the US, Canada and the UK, the fringe lending sector in Australia has experienced considerable growth over the last decade. Large numbers of people on low incomes in Australia are turning to non-mainstream financial services, such as payday lenders, for the provision of credit to make ends meet. In this paper, we argue that the use of fringe lenders by people on low incomes reveals important theoretical and practical insights into the relationship between the mixed economy of welfare and the mixed economy of credit in poverty survival.

Type
Articles
Information
Journal of Social Policy , Volume 43 , Issue 1 , January 2014 , pp. 155 - 172
Copyright
Copyright © Cambridge University Press 2013 

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