The Australian Council of Social Service (ACOSS) says the South Australian and federal governments should scrap plans for cashless welfare cards.

They say planned trials of the cards – which limit a welfare recipient to spending just 20 per cent of their money, while the other 80 per cent is used by the government to cover their rent and bills - should not go ahead without proof they will actually work.

Proponents of the cards say trials are a way to find that proof.

The idea came from a report commissioned by mining magnate Twiggy Forest, and was backed by the Federal Government after an Indigenous employment review this year.

An agreement has been reached with the South Australian Government and community leaders in the far west of the state to test the cards in the Ceduna area.

But ACOSS spokesperson Tessa Boyd-Cain says the cards only serve to punish the poor.

“It's a direct impact from the moment they are subjected to it,” she said.

“More importantly we're concerned that there really is not the evidence base to support such a significant and indeed such a drastic reduction in terms of the access people have to the incomes that they rely on for their survival.”

Ceduna's Mayor Allan Suter said welfare representatives could go to Ceduna if they wanted to experience the town's issues first hand.

“We certainly have very strong community support,” Mr Suter said.

“Many of the people that will be affected by the trial are in favour of it and, if I may quote one of them, he said; ‘It might be the bit of help that I need to get me off the grog and back on my feet’.

“It would be much more believable if they [ACOSS] took the trouble to actually speak to the people affected by the trial.

“It is actually designed to help people with a serious problem not to cause unnecessary restrictions on people.

“I think sometimes these lobby groups lose sight of the facts.”