Financial Counselling, Capability and Resilience Hubs Information Session Presenter Script

Financial Counselling, Capability and Resilience Hubs Information Session Presenter Script

Acknowledgement

I would like to acknowledge the traditional owners on whose land we meet today and pay my respects to their elders past and present.

Session outline

We may not be able to answer all questions today for example if:

•the question is complex and we need to follow up;

•we need to check with other parts of the Department for answers; or

•further clarification is required to understand the question.

The presentation and all questions and answers will be published on the DSS website, including questions we need to take on notice.

We will endeavour to provide these answers within five working days.

Please monitor the website and ensure that you have subscribed to the email alerts so that you receive notification of any updates. You can subscribe to grants updates via the grants page at the DSS website.

There are a number of Questions and Answers already available on the DSS website which we recommend you review if you are interested in applying for this funding. Copies are available today if you haven’t seen these yet.

What will be covered in this presentation?

The purpose of today’s information session is to:

•Explain the services under the Financial Wellbeing and Capability Activity and how this is different to the previous Financial Management Program;

•Provide information about the Financial Counselling, Capability and Resilience Hub Grant Round which is currently open for application in 22 sites; and

•Provide an opportunity for you to ask questions about the Grant Round.

We won’t talk about:

•How the assessment process will be conducted beyond information already provided in the Programme Guidelines and the DSS website; or

•Other funding arrangements that you may be interested in or already have with the Department.

Financial Wellbeing and Capability Activity

From 1 March 2015, the activities previously funded under the general Financial Management Program (FMP) and Household Organisational Management Expenses (HOME) Advice Program transitioned to the new Financial Wellbeing and Capability (FWC) Activity.

Services supporting the Income Management areas in the Northern Territory, Western Australia, South Australia, New South Wales, Victoria and Queensland are now also transitioning to the FWC Activity. The non-income management funded services in the Geraldton region of Western Australia are also funded through this process.

The services included under the Activity provide crisis support, broad financial capability building services, Financial Counselling, and access to microfinance products.

Commonwealth Financial Counselling has retained the same name, but Money Management Services are now known as Financial Capability services.

Financial Resilience encompasses microfinance services, I will talk a little more about that in a moment.

These services fit under the sub-Activity of Financial Counselling, Capability and Resilience.

Emergency Relief and the new Food Relief activity also come under the FWC Activity but these sub-Activities are not part of this funding round and therefore are not the focus of this session.

Aim of the Financial Wellbeing and Capability Activity

The Financial Wellbeing and Capability Activity contributes to improved outcomes for vulnerable people, families and communities by:

•helping people address immediate needs in times of financial crisis such as by providing Emergency Relief or access to Financial Counselling;

•improving financial capability by helping people to make informed choices and address their financial problems and by improving their use and management of money with the help of Financial Capability services;

•assisting individuals, families and communities to navigate life transitions and/or financial stress or crisis such as through case management approaches;

•improving financial resilience and pathways to mainstream financial services by providing access to savings and credit vehicles like NILS or Step Up loans;

•recognising families at risk of homelessness and providing early assistance to prevent family homelessness through Financial Capability or like services; and

•implementing research and evaluation activities to contribute to programme and service improvement.

Activity outcomes

To help determine how well the aims of the Activity are achieved, there are four outcomes that the Department will measure under the Financial Counselling, Capability and Resilience activity:

•Clients have improved financial capability;

•Services are able to address people’s needs in times of financial crisis;

•Services assist individuals, families and communities to navigate life transitions and/or financial stress or crisis which may negatively impact on their wellbeing; and

•Clients achieve improved financial resilience and can access pathways to mainstream financial services.

A key focus of the FWC Activity is to achieve better integration of services to build long-term financial wellbeing, focus on the goals of early intervention and prevention and ensure a continuum of support for vulnerable people.

Ultimately, the very long-term aim of the programme is that less people need to access crisis services by ensuring all citizens have robust skills and knowledge in relation to their finances.

Financial Wellbeing Continuum

The FWC Activity has been designed to improve outcomes for people and communities through better access to services across a continuum of needs represented in the Financial Wellbeing Continuum.

This framework has evolved over the past five years as we have developed a deeper understanding of the impacts and influences in people’s lives which make them seek out our services.

Thanks to the impact of the services that many of you deliver, the intelligence we gather at the local level, and the research that we tap into, we continue to develop a better understanding of how Financial Counselling and Financial Capability contribute to financial wellbeing.

We understand it takes a long time for people to move along the continuum and that people may move back and forwards before achieving greater skills and resilience. We also understand that some people may never reach that point due to a variety of factors.

To help people avoid reaching crisis points and build resilience, early intervention through education is a focus of the services.

We are always learning more about how people move through the continuum and also how this interacts with other social supports people may need, like family relationship counselling.

As we understand this better overtime, we will continue to evolve the service delivery models to ensure they are providing the most effective support to people.

Why have the services changed?

There were two main factors that influenced the need for change from the old Financial Management Program.

The first is the need to better integrate our services.

Historically, the FMP was made up of a number of separate but complementary services, including Emergency Relief; Commonwealth Financial Counselling; Money Management Services; and Microfinance products.

Because they each have their own history of how they came to be funded by DSS, they tended to operate independently from each other.

The second is that clients’ needs are changing.

We have heard from current service providers that the complexity of needs experienced by clients has increased markedly.

From simple assistance with paying their rent or electricity bills, clients are now seeking assistance with more complex issues like gaining access to appropriate loans and dealing with organisations seeking to take advantage of them financially.

To address complex client needs, evidence suggests that the more support that is linked together to provide a “wraparound” approach, the better the outcomes for clients and their families.

There are many organisations that already provide Financial Counselling or Financial Capability alongside a suite of other services which allows them to assist people at different points in the continuum.

For example, about 17 DSS funded organisations across Australia are providing Emergency Relief as well as Financial Counselling or Financial Capability services.

This allows these organisations to help support clients in crisis and then assist them to build capacity with the aim of preventing further need for crisis support.

We understand that a “one size” fits all model does not work in such a geographically and economically diverse country as Australia. However there are enough similarities across the client groups to indicate the value in providing closely linked services.

This includes working more closely with other Financial Wellbeing and Capability services and with other programs such as employment services and the finance sector to ensure clients’ needs are being fully met.

There is also a need for service delivery to become more efficient to ensure the funding available is targeted to need.

What has changed?

The main changes made to the programme to enhance outcomes for clients relate to enabling closer integration of services to ensure people are able to easily access the services they require.

The first step in achieving this was to group the services and their respective funding together. By doing this we can also include related services on one grant agreement, reducing red tape for service providers.

Service providers are also able to tailor their services to meet community needs by employing the appropriate staffing ratios. For instance, if organisations see increased demand for Financial Counselling, resources can be directed at that activity without the need to seek a change in their agreement with the Department.

Services can provide a combination of both direct case work and one-on-one support through Financial Counselling and financial literacy education and information, in conjunction with other relevant programmes funded by other areas of government.

Financial Capability

Financial Capability services are often about community education, budgeting help or similar. The primary aim of the Financial Capability worker is to help people develop the capability to budget and manage their money.

By delivering basic financial literacy, education and support, workers help people to look after themselves and their families in the long term.

The Financial Capability role is a key early intervention and prevention role in the Financial Wellbeing continuum. It’s a role that we know some organisations currently link closely with crisis intervention services like Financial Counselling and Emergency Relief.

Financial Capability workers can offer basic information and immediate support to people who may be on a wait list to see a Financial Counsellor. They can also provide ongoing support to a client following a meeting with a Financial Counsellor to enhance the client’s financial capability and wellbeing into the future.

Qualified Financial Capability workers can also deliver the Indigenous Home Ownership Education training package known as IHOME. IHOME is a training package designed to provide information to Indigenous Australians on home ownership on Indigenous lands and is currently offered in some locations in Queensland and the Northern Territory.

As part of this funding round, IHOME must be made available in specified communities in the Northern Territory and Western Australia. These communities are identified in the Funding Round Summary.

The IHOME training package, including training for staff to deliver the package, will be available to assist service providers with implementation.

Financial Counselling

Financial Counsellors provide intensive support through an in-depth assessment of a person’s financial situation to understand the extent of the person’s financial difficulties and to identify options to address these. They encourage the person to participate in the planning and decision-making process.

The aim is to resolve or alleviate the person’s financial difficulties, and improve their ongoing financial capability and inclusion. Financial Counsellors also refer customers to other local sources of support and assistance as necessary.

We see the role of Financial Counsellors and Financial Capability workers as complementary.

In the past these roles have largely operated separately, however organisations provided feedback that Financial Counsellors were struggling to meet demand from clients with complex financial needs, and that they would benefit from being able to refer people with less critical or complex needs to other support services.

Having Financial Capability workers working closely with Financial Counsellors will allow Financial Counsellors to focus on crisis support and complex issues.

Financial Resilience

Financial Resilience (or microfinance) provides financially vulnerable people with access to safe and affordable financial products including no and low interest loans.

Microenterprise development loans or other appropriate loans, and matched savings that are not available through mainstream providers of financial services are also part of Financial Resilience.

These products are offered as an alternative to other high risk, high interest products such as payday loans.

The products are provided in conjunction with financial literacy education to improve financial capacity and lead to greater self-reliance, assisting people to build assets, develop savings and commence on the pathway to financial inclusion.

This makes these services a valuable complement to Financial Counselling and Financial Capability services.

Financial Counselling, Capability and Resilience Hubs Grant Round

An open selection process has commenced to provide funding to establish 22 Financial Counselling, Capability and Resilience Hubs.

Applicants do not have to be a current provider in order to apply.

Funding is available from 1 January 2016 to 30 June 2017 which aligns with funding for other FWC services introduced across Australia last year.

The Hubs will be established in current income management locations in Western Australia, the Northern Territory, South Australia, Queensland, New South Wales and Victoria. A service in the Geraldton region of Western Australia will also be established through this process.

The services are being established in current income management locations to maintain service continuity to ensure that existing clients are able to continue to access services in their area.

We expect grant agreements to be in place for service delivery starting on 1 January 2016.

What is a Hub?

A Hub will deliver a core service of Financial Counselling andFinancial Capability to individuals and communities in each coverage area.

The service delivery model will help communities develop and foster positive attitudes and behaviour in their management and use of money.

This approach is different to last year’s funding round where applicants could choose to deliver either Financial Counselling or Financial Capability services or both.

Under this grant round an integrated Financial Counselling and Financial Capability service must be offered.

Each Hub will provide a minimum service offer of Financial Counselling and Financial Capability services as the first step toward achieving this integration.

We are open to innovative methods to delivering integrated services. For example, services can be delivered from one location, by one or more organisations or from multiple locations provided that the services continue to be accessible to all eligible consumers.

We understand that some providers are already delivering this type of integrated service offer.

Further integration can be achieved through incorporating microfinance services such as low or no-interest loans where appropriate. Organisations are encouraged to include microfinance services if that is identified as a community need.

For example, the Department is providing over $12 million (excluding GST and SACS) over two years to Good Shepherd Microfinance to assist with the delivery of NILS and StepUp across Australia. Additionally the Department is providing nearly $12.5 million (excluding GST and SACS) over two years to support other microfinance services that assist low income and vulnerable Australians.

While no additional funding is available from DSS to support additional initiatives providing consumer loans, DSS is interested in continuing to build on the integration of services delivered under the Financial Wellbeing and Capability Activity.

We know that some of our Financial Counselling and Financial Capability services are already delivering these services, if you’re not currently delivering these services but want to find out more please contact Peter McNamara at Good Shepherd Microfinance.

The aim is toimprove consumer outcomes and ensure consumers receive services tailored to their needs to better prevent issues from escalating or recurring.

Consortium arrangements or local partnerships are encouraged because we know that different organisations bring specialist skill sets to the table and we are keen to encourage that in service delivery.

Applicants should ensure that their applications clearly describe the range of services that will be offered, how the Financial Counselling and Financial Capability services will be integrated with those services, and any partnership or consortium arrangements proposed.

Expectations

Hubs are expected to provide priority access to consumers participating in income management.

The final service offer, meaning the ratio or mix of Financial Counselling to Financial Capability services, to be delivered is up to the funded organisations to determine based on the identified needs of the communities they are servicing.

For example, organisations may establish that a community wishes to have a microfinance service available and put a plan in place for this service to be made available.

This should be reflected in your application.

There is no funding under this round to support additional initiatives providing consumer loans, however, organisations can consider allocating resources under this round tothe provision of microfinance.

For example, organisations could engage a staff member to liaise with microfinance providers in making those services available to clients or assist clients to apply for no or low interest loans.

While models of service delivery are at the organisation’s discretion, they must deliver the required outcomes per the Activity requirements in their grant agreement.