Launch of Good Shepherd Report: Microfinance and the Household Economy

E & OE – Proof only

Thank you, Paul [McDonald, Co-chair Anti-Poverty Week Victoria & CEO Anglicare Victoria].

I would like to pay my respects to the traditional owners of the land on which we are meeting, and to their elders past and present.

I would also like to acknowledge:

• Simon McKeon, Australian of the Year
• Robyn Roberts, CEO, Good Shepherd Youth & Family Services
• Rhonda Cumberland, CEO, Good Shepherd Australia & New Zealand
• Professor John Langmore.

It’s a pleasure to be here today at the start of anti-poverty week.

The report that you are launching here today – Microfinance and the Household Economy – tells the story of how, for vulnerable people, a relatively small amount of money through a no or low interest loan can provide a real leg up.

People like Rose, who became an advocate for financial literacy in her community in far north Queensland after using a microfinance loan to buy a washing machine. A few hundred dollars freed up hours of Rose’s time in hand washing for her seven children.

People like Dina, who used a microfinance loan to buy a vehicle to run her business.

And people like Lucy who used a microfinance loan to buy a laptop to help her study. A single mother from western Sydney, Lucy’s study led to a job.

Her employment meant she was able to pay off her loan quickly.

And meant she could get a StepUp loan to buy a car – so she is now able to visit friends and family easily, and to take her son to sport on the weekends.

This is the opportunity that, for three decades, Good Shepherd has been providing for vulnerable Australians.

We are pleased to be working with Good Shepherd and the National Australia Bank on the No Interest Loans and the StepUP schemes to help vulnerable people in communities right across Australia.

And we were pleased to support Good Shepherd’s work again in this year’s Budget, by securing ongoing Australian Government funding – $24 million over the next four years – for the NILS and StepUP programs.

Last year, around 13,500 households received a loan under the No Interest Loans Scheme due to this really fantastic partnership between the Government, the National Australia Banks and the Good Shepherd.

What this report reminds us is that every one of the people we hope to help with microfinance has a story to tell.

In roles like mine, as Minister for Families and Community Services, we tend to work at scale – with millions, and even billions, of dollars in programs to support vulnerable people and to help families and pensioners balance their household budgets.

For example, this financial year we will spend $1.3 billion delivering Paid Parental Leave to families across the country, to allow them to spend more time with their new baby in those precious first few months.

And we will spend $34 billion on the age pension, making sure that after a lifetime of work older Australians are supported in retirement.

But in each of these big numbers are real people, who need the help and support of a strong system of social support.

And for vulnerable Australians, who need a helping hand to reach new opportunities.

People like Lucy, who took the opportunity of a small loan to make a big difference in her life – to launch her participation into the workforce, and into her community.

And it’s these people who must be at the centre of our decision-making when we’re considering the big numbers.

It was Australians on low-incomes who were at the forefront of our thinking in developing our Clean Energy Future plan, which passed the House of Representatives in the Parliament just this week.

We believe that action on climate change is the only responsible course of action – it’s in the interests of our economy, and in the interests of our children.

But in delivering a price on carbon pollution, we were very concerned to make sure it was the big polluters who paid for their pollution – and not low income families, or those on pensions and allowances.

We are particularly concerned to make sure that the most vulnerable Australians get the helping hand they need to balance their household budgets.

We have targeted assistance to those who need it most. Low income families and pensioners will receive more in support than their average expected price increase from putting a price on pollution.

And it’s no strings attached – so that if families make small changes like switching to energy efficient light bulbs – they can end up ahead.

Today, I’m pleased to announce a new Home Energy Saver Scheme to help low-income families make those small changes – and end up better off.

Many of your organisations already provide valuable financial counselling services to vulnerable families – providing them with the skills to stay on top of their budgets.

Now, with the Home Energy Saver Scheme, low income earners can also get a hand to develop ‘energy literacy’ skills.

The Home Energy Saver Scheme is based on the successful Kildonan UnitingCare model, where trained workers visit people in their homes to help them makes their households more energy efficient.

I am told that from the program architect from Kildonan UnitingCare is here today – so thank you Stella.

This new scheme means that people will be able to sit down in their own homes with a Home Energy Saver Scheme worker to make sure they’re accessing all the financial support and rebates they are entitled to.

They’ll get support to one-on-one budgeting advice to work through their finances and look at where they can save energy – and save money.

They’ll receive advice about how they can make their homes more energy efficient – as well as access to no interest loans to purchase energy efficient appliances like a refrigerator or washing machine.

The Home Energy Saver Scheme will start early next year before the carbon price begins in July. The Government is providing $30 million for the program over the next four years, including $5 million for no interest loans managed by Good Shepherd.

The program will start early next year before the carbon price begins, we expect more than 50,000 low-income households around the country to benefit from the new program over the next four years. And around 10,000 extra households to take up a no interest loan.

And like Rose, and Dina and Lucy – each of these families will have their own story to tell.

For a family struggling to pay their electricity bill, there will be more help.

This report shows that schemes such as NILS and StepUp can and do work.

That with the right incentives, people want to learn how to better manage their finances.

And that giving people a helping hand can make an enormous difference.

So thank you to all those who shared their experiences.

And thank you to the National Australia Bank and Good Shepherd for their foresight and hard work to deliver real support to real people, right around the country.