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Monday, 1 September 1997
Page: 7455

Ms ELLIS(8.00 p.m.) —Tonight I want talk about the CARE Credit and Debt Counselling Service which was started in the Australian Capital Territory in 1983. CARE's services include, among other things, legal advice on consumer credit and debt matters for low-income people. It has one full-time solicitor and financial counsellors—paralegal workers who are tertiary qualified counsellors.

CARE Credit and Debt Counselling Service offers a holistic approach to its clients. The problems can include: inability to service debt due to illness or some misfortune; problems with credit firms; and a wide range of financially based concerns. Over the years, I have referred many people to CARE—in fact, I did so only last Friday. The role of CARE is extremely important to the lower income sector of our community.

Last year, CARE saw some 2,047 clients. When we translate that to over 60 per cent of its clients being families, you can see the number of people who come under the care of CARE. Sometimes, the initial interview could take up to two hours. A lot of personal information and family detail is required to fully understand the extent of the problems facing the family concerned. In past times, but unfortunately not now, a local child-care centre was able to offer support by caring for the small children of those families during those initial interviews, in most cases free of charge. It was really like the community helping the community. But unfortunately things are different now. All this started to change with the Liberal government's budget of last year.

Let me give you some background. The Commonwealth government provides a small funding program of, in this current year, $1.99 million for financial counsellors nationally. The program is administered by the small business and consumer affairs division of the Department of Industry, Science and Tourism. The ACT's share of this funding is paid to CARE.

The history of CARE's funding from the program is as follows: in 1991, $51,307 employed one full-time financial counsellor; in 1993-94 it was $52,892; in 1994-95 $54,837 employed one full-time worker—a 3.67 per cent increase, thus keeping pace with inflation; and in 1995-96 it was $55,676. On recommendations from the department and in direct response to unmet demand the program received a small increase and CARE received an additional $7,090 in March 1996. CARE took the funding on the understanding that if it increased hours the funding would not be short-term top-up funding. CARE increased hours to one full-time and one part-time worker. At the time, CARE had a waiting list time of some 13 weeks for a first appointment.

In 1996-97, this government reneged on the commitment to maintain the modest increase and CARE funds were reduced to $51,030—hardly sufficient to employ one full-time worker. This year, no provision was made for CPI increases. In the same period, the federal government also totally defunded the peak body, the Australian Financial Counselling and Credit Reform Association, that had provided so much support and guidance to agencies like CARE.

Conversely, Labor made significant increases to the program. In 1995, Labor provided the program with $6.4 million over four years in the Justice Statement. This was reneged on by this government. The cut in the current government's 1996 budget to the Commonwealth financial counselling program was approximately 11 per cent, however that cut amounted to around 25 per cent when taking into account the Justice Statement funding allocated under Labor.

This allocation was cut when the coalition gained government. The situation in my electorate of Namadgi and in the ACT generally is of huge concern. By sacrificing longer term case work, CARE absorbed a 38.6 per cent increase in the number of people seen. The choices they must make are heart-rending. The level of unmet demand continues and is growing. There can be no doubt that financial counselling returns a net benefit to government. CARE is already an efficient and effective service, with no excess or discretionary budget items that can be cut. The overall meanness of the reduction to this already inadequately funded program seems almost punitive rather than having any rational basis or analysis of the social cost.

The government has targeted Canberra for massive cuts to its employment base. We are already seeing an increase in new clients presenting as a result of unemployment and underemployment. A 59.89 per cent increase in personal bankruptcies in the ACT for 1996-97 is a further indicator of financial failure for increasing numbers of Canberrans.

It is incomprehensible that, at a time when its policies are hurting so many people, the government would reduce the safety net of programs like financial counselling. CARE's clients are increasingly drawn from those whom we would have considered as middle- income earners three to four years ago. A very noticeable change in attitude has been reported by counsellors. Formerly, clients had hope. They would say, `When I get a job I will be able to manage and life will return to normal.' Now there is an overwhelming belief that their situation will not improve and that their future in Canberra looks grim.

These people are increasingly cynical about the promised benefits that the current economic policy is supposed to deliver. They are understandably afraid that by the time the benefits from that economic pain arrive, their situation will have deteriorated to such an extent that they will not be in a position to participate.

Overarching the growing sense of frustration and very real anxiety is a belief that, at the highest levels of government, this community is held in contempt and treated accordingly. It is no good the Prime Minister (Mr Howard) coming into this community, as he did last week, and parading himself and his government with some caring, compassionate `we really didn't mean to hurt you all, we really like Canberra' charade.

While this government continues to make these disastrous decisions, all the hyperbole in the world will be just that—a distortion of the facts. The service of the CARE Credit and Debt Counselling Service must continue to be delivered. The government must reconsider the funding for the financial counselling program both here in the ACT and nationally.

I can only reiterate the instance of a lady coming into my office last week who was in dire financial circumstances, mostly not of her own making, and who desperately required the services of the CARE Credit and Debt Counselling Service, a service proven worthy since 1983. CARE cannot continue to hope to deliver the services to the community as required whilst facing the sorts of funding cuts that they are currently attempting to endure. The lady whom I referred to them did get phone counselling today and I am sure that she will eventually receive the benefit of the advice from the CARE Credit and Debt Counselling Service. But she and many others in Canberra who are awaiting that service are going to have to wait an inordinate amount of time.

It seems to me quite unacceptable and pretty deplorable that, at the very time the government is putting pressure on the community which means more people require this sort of service than one would wish to see, we see a counterattack, and that is an attack on the services that can help to alleviate the difficulties faced in this financial climate. I cannot impress enough upon this House the distress that is being felt within my local community in a financial and social sense. The CARE Credit and Debt Counselling Service simply must be given the ability to carry out the service it is professionally qualified to do. I implore the government to reconsider its whole position in regard to the funding of CARE Credit and Debt Counselling Service and of similar services around the country.