Financial Counselling Australia 2023 National Conference

Good morning.

I would like to start by acknowledging the traditional owners of the lands on which we meet, the Ngunnawal and Ngambri peoples, and pay my respects to their Elders – past and present.

I extend this acknowledgment and respect to all First Nations peoples here today.

I’m proud to be part of a Government committed to delivering a Voice to Parliament for Aboriginal and Torres Strait Islander people.

I would like to acknowledge other guests and speakers joining us today, including:

  • Anne Crouch, the Chair of the Financial Counselling Australia Board.
  • Fiona Guthrie, CEO of Financial Counselling Australia.
  • Peter Garrett, lead singer of Midnight Oil and my former colleague who served as a Minister under the Rudd and Gillard Labor Governments.
  • And Ms Lynda Edwards, well known to you all as a financial counsellor with Financial Counselling Australia, and in March this year recognised as NSW Woman of the Year and Aboriginal Woman of the Year.

Thank you to Financial Counselling Australia for inviting me to speak today.

The work undertaken by financial counsellors, many of you here today, can – quite literally – save lives. You provide important and valuable support and we must ensure those who need support can access it.

The Commonwealth plays an important role here – but industry also has an equally important moral obligation to contribute too.

According to the latest estimates, around 305,000 Australians access some form of financial counselling each year – either face-to-face or via the National Debt Helpline.

Particularly now – when we know many Australians are feeling the impacts of cost of living pressures – the work of financial counsellors has never been more critical.

This year alone there have been an additional 10,000 calls to the National Debt Helpline compared to the same time last year.

Australians who need support must get timely access to it and we have to work in partnership with the financial counselling sector, industry and states and territories to ensure they are getting it.

Everyone must play their role and take on their fair share.

I remember not too long ago on a visit to Sydney meeting with a woman who generously spoke with me about her own story of financial hardship and how connecting with a financial counsellor helped to give her back some dignity and control of her life and her future.

For many Australians experiencing financial distress, it’s the first time they have been in financial difficulty and reaching out for help. 

Financial counsellors don’t just bring the fiscal tools needed to assist their clients. They also bring empathy and emotional support to those in financial stress.

Thank you to all financial counsellors here today for your invaluable work in supporting our community.

Up to 60 per cent of those who access financial counselling are women in financial distress. Many are experiencing or have experienced financial abuse from an intimate partner.

These women are also often dealing with other forms of family, domestic, and sexual violence.

For many of these women, financial counsellors can sometimes be the first person they disclose their abuse to.

This support from a financial counsellor often provides the solution to help these women reach financial freedom, which is critical to their safety and recovery.

While female clients are the majority, around 25 per cent of clients accessing financial counselling services identify as First Nations.

Our Government is committed to increasing the focus on financial literacy and independence, particularly for First Nations individuals.

We are also dedicated to responding to the feedback received through consultations with communities.

To this end, I recently announced, after consultation with communities further investment in improving financial literacy and financial counselling delivered in a culturally appropriate and safe way. 

We listened, to meet the needs of communities.

Given the increasing reliance on financial counsellors to support growing and complex needs, the Federal Government continues to provide nearly $50 million each year to financial counselling supports across the country.

But, the Commonwealth alone cannot fund the demand that is needed. And, frankly, nor should it. Industry must play a bigger role.

The Hayne Royal Commission into the banking sector found that – and I quote – “the desirability of predictable and stable funding for… financial counselling services is clear and how this may best be delivered is worthy of careful consideration”.

The Sylvan Review stated that “demand pressures are contributed to by industry”.

And that “it is appropriate for industry to participate and contribute to the increase in the availability of and access to financial counsellors and for additional funds, bolstering current state, territory and Commonwealth governments’ contributions, to be provided by industry sources”.

In 2022, nearly 80,000 people were assisted through Commonwealth-funded financial counselling programs.

We know vulnerable people could be waiting too long for support.

The Government’s proposed voluntary industry funding model is aimed at improving access and sharing responsibility.

The industry funding model I am proposing is designed to receive and distribute funding contributions from industries that contribute to demand for financial counselling and benefit from the services.

I know the financial counselling sector has been waiting a long time – more than three years since the Sylvan Review – for an industry funding model, and I am personally committed to delivering its establishment without further delay.

I have made this commitment clear in discussions with industry representatives from banking and finance, telecommunications, energy, insurance and the online gambling sectors.

A lot of consultation has been undertaken on the model, including with the release of a discussion paper on the proposed model in November last year.

But with the consultation process now complete, my focus is on securing funding commitments from the industry, including from the online wagering sector.

The time for talking is over.

Over the past two years, formal working groups with financial counselling and industry stakeholders met 16 times with Government to support the development of the model.

The consultation process has included:

  • 54 discussion paper submissions
  • 151 roundtable attendees from the financial counselling sector across three roundtables, and
  • 53 roundtable attendees from industry across six roundtables

I recognise it has been a long journey, and I thank you all for your patience.

I’d also like to thank those who have given in-principle agreement to the model.

This includes:

  • The Australian Banking Association;
  • Responsible Wagering Australia;
  • The Australian Energy Council;
  • The Australian Finance Industry Association;
  • Tabcorp;
  • The Communications Alliance and;
  • The Insurance Council of Australia.

I thank these organisations for writing to me and outlining their support and I look forward to more organisations also giving their agreement.

My Department has now issued Memorandum Of Understandings to all who would be involved in an industry-funded model and it is my expectation these agreements would be signed and taken through all internal industry processes by August 31 this year.

This timeline is crucial to ensure that the not-for-profit independent body with oversight of this industry-funded model can be fully operational by 1 January 2024.

I want to be clear, our Government expects full sign on. And any delay on these MOUs will only be hurting Australians who need support in the current economic climate.

The Albanese Labor Government is committed to ensuring a well-supported financial counselling sector. Not only are we progressing an industry-funded model and independent body but we are also today announcing a further boost to ensure the sector’s long-term viability.

Grant funding of $1.2 million will go to Financial Counselling Australia to expand the National Debt Helpline Appointment Booking Project which simplifies the booking process for clients and ensures people don’t miss out on the support they need.

The project, which has been trialled in West Australia, will be expanded throughout WA, the Northern Territory and South Australia.

The funding will also support preliminary development of rollout to the eastern states.

The project allows the National Debt Helpline to triage clients and book directly with a counsellor on their behalf. Reducing the stress of a client having to call multiple counsellors to get an appointment and risk not being connected for support.

It’s an example of our Government funding things that are evidence-based and will support those who need it in a practical way.

In addition to funding certainty and long-term viability, a key focus of future initiatives for the Government is the quality and availability of consistent, outcomes-focussed data across the financial counselling sector.

Currently the collection of this data is disjointed, and not easily comparable between jurisdictions which creates a challenge to construct a holistic, national picture of financial counselling services, clients, and service delivery.

My department is working to improve data capability initiatives.

Building the evidence base helps to ensure support is directed to the right places and to those who need it most.

While I am heartened that Responsible Wagering Australia has given in-principle commitment to an industry-funded model, I cannot deliver this speech today without highlighting the financial distress caused by the gambling industry for problem gamblers.

The Albanese Labor Government takes gambling harm seriously.

We remain committed to protecting consumers, including their families and the community, from the harm particularly caused by problem online wagering – the area for which we hold responsibility jointly with our state and territory counterparts.

Typically, the impact of significant problem gambling extends to around six other people, while low risk gamblers affect one other person and moderate risk gamblers affect up to three others.

Just last month, my colleague – the Communications Minister Michelle Rowland - and I announced our Government would ban the use of credit cards for online gambling.

This brings online wagering into line with land-based gambling where credit cards cannot be used.

It’s a positive step and it builds on our other measures to reduce problem online wagering, including the implementation of new taglines, mandated activity statements and our commitment to delivering a national exclusion register.

This will build a culture of responsible online wagering throughout organisations nationally.

But minimising the harm from online wagering is not a set and forget exercise.

The House of Representative Standing Committee on Social Policy and Legal Affairs is currently examining the impacts of gambling and how to best prevent harm.

Outcomes from the Inquiry are expected by the middle of this year.

I will work with my colleagues across the Commonwealth, and states and territories, to consider all options to minimise the risks and potential harm.

I thank the many of you who advocate for the need for gambling harm reduction, in particular to Financial Counselling Australia, and your board.

I also wanted to use today’s address to reaffirm the Government’s commitment in taking action to address the risks of consumer harm associated with Buy Now, Pay Later products.

I know this is an important issue for you.

Last November, led by the Assistant Treasurer Stephen Jones - the Government released an options paper proposing three options for regulatory intervention.

The paper was the subject of extensive consultation, including with many of you here today. 

Based on this consultation, the Government is considering the best way to protect consumers.

An announcement on proposed reforms is expected within the coming weeks, so stay tuned.

To finish today – the time for talking is over. Both from myself here at this conference lectern, and, from the broader sectors who we are working with to ensure an industry funded model becomes reality.

For those Australians who need vital financial counselling support and are not getting it because of lack of capacity, we cannot leave them behind any longer.

Those industries who are main stakeholders in this need to step up and do their part.

I’m heartened by the progress we’ve made. And I’m heartened by the spirit of collaboration that has permeated discussions thus far.

Thank you again to Financial Counselling Australia for inviting me to speak today.

Thank you to everyone here who contributes to helping those in financial distress and need.

Particularly for the continuing efforts to help individuals impacted by natural disasters over the past few years.

I hope you enjoy the Conference and your time in Canberra.