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Fears over impact of welfare card removal

Members of the federal opposition have raised concerns about scrapping cashless welfare cards. (Mick Tsikas/AAP PHOTOS) (AAP)

Thousands of people living in remote communities will soon be taken off cashless welfare cards, but there are fears the change could see a spike in alcohol-related violence.

Laws to fulfil a Labor promise to abolish the card are due to be debated in the Senate this week.

Northern Territory coalition senator Jacinta Price said she was standing up for the cards due to her own experience as an Indigenous woman.

"I've been confronted with alcohol abuse. I've been confronted with alcohol-related deaths. I have been confronted with the way alcohol has impacted my family directly," she told reporters in Canberra on Monday.

"I stood up for this card because I know and have seen and have watched the benefits for the most vulnerable in communities."

Liberal MP Rowen Ramsey said the card had reduced the number of alcohol abuse-related deaths from seven to zero in Ceduna, in his South Australian electorate.

"(The card) protects those people who are unable to manage their own lives."

The card covers more than 17,000 welfare recipients and can carry up to 80 per cent of Centrelink payments.

That money can't be withdrawn in cash or spent on gambling or alcohol.

But the government argues the cards have failed and stopped individuals from making decisions for themselves.

Welfare recipients will be able to opt into a voluntary income management scheme.

Labor has flagged a range of amendments to secure support from the Greens and crossbench.

These include providing access to more businesses and enabling online shopping.

Almost $50 million has been put aside for extra alcohol and drug services as well as more money for employment programs.

Social services Minister Amanda Rishworth said the additional funding wasn't about securing votes in the Senate but rather implementing measures to "actually address the underlying problems".

"Whether that is drug and alcohol or other programs, it's critically important we deliver," she said.

Labor senator Malarndirri McCarthy said the card had exacerbated the humiliation in Indigenous communities spanning from the "heavy handed" approach of the Northern Territory intervention.

"I want the Senate to never forget that deep feeling of disempowerment, disrespect and shame," she said.

Greens senator Janet Rice welcomed people being able to control their own finances again.

"Able to buy clothes for their kids at second hand stores, able to pay cash for fruit and veg at street markets and to buy stuff on eBay rather than having most of their income quarantined."

Opposition health spokeswoman Anne Ruston said the additional funding proved there would be a spike in drug use when the card was abolished.

"Shame on the Labor government. They've left great uncertainty for vulnerable Australians and then at the 11th hour had to admit they got it wrong."

Senator Ruston tried to halt the legislation until the government provided further information on its income management plans.

If passed this week, welfare recipients will be able to move off the card by October 4.

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