credit unions and the needs of indigenous Australians

I asked my friend Steve Soames (Associate Principal, Ngaanyatjarra Lands, Warburton Ranges Campus) whether the credit union movement was alive and well in Australia. In his informative newsletter he had identified the debt problems in his local community. I wondered whether credit unions might possibly help.

He responded as follows ;

There is a Credit Union movement in Australia, but it seems to be the domain of savvy white folk or pretty mainstream, acting like a bank. The issue of schonky money lending is pretty grim as folk living in a dry community will do just about anything to access alcohol when visiting a community where it is legally available. In fact income management is a significant issue here. On 'pay-day' there are many card games around the community with the stakes getting progressively higher. The Rudd government has issued two 'stimulus packages' which put a lot of money into the hands of families on benefits. The effect of that out here was to increase gambling, people leaving the community for a drinking binge and purchasing large consumer items such as cars (which compound the need for extra money for fuel etc...)
The Community Development Adviser does a form of income management in order to ensure that the housing stock is adequately maintained. He holds back 10% of income for this purpose...I NEVER thought I'd see myself supporting the equivalent of a poll tax having fought tooth and nail against it in the UK!

Credit Unions would certainly be a powerful local solution, but I think they may be some way down the track as there's currently a greater need for basic financial management. The folk out here are only 3 or 4 generations out of the desert. successive government policies of welfare dependency and 'guilt money' aimed at keeping social issues contained in remote areas has done nothing to build capacity around sound financial management.

Added to this mix is the cultural importance of family. Family members are obliged to 'share' resources...a great survival mechanism when living a nomadic existence in such a harsh and unforgiving environment, but it doesn't suit a residential population as things get pulled down to the lowest common denominator. For example, when in Laverton I was exploring childhood nutrition...why were indigenous families not purchasing enough food for the week and rationing it out. The answer was that family members would rock-up and empty the fridge/larder as living hand-to-mouth is the norm. It is easier to hide a few bucks and give this to the children to ensure that they get a daily lunch. We needed to teach the children to make healthy choices at the store...but in remote locations, it's easier to provide pies and coke than it is sandwiches and fruit.

My current assessment is that mainstream, anglo-saxon economic solutions may not be the answer to supporting a culture in rapid transition. Families are a real strength and possibly offer a solution. White agency folk tend to get too bogged down in the symptoms and Heads of Service are too busy trying to meet unrealistic government targets...sound familiar "

debt and mental health

I spoke at a conference a couple of weeks ago on the subject of how mental health and debt are connected. People with mental health problems of all kinds are more likely to have debts, and these debts can cause them terrific stress and anxiety. There are some real professional challenges both for mental health workers and for debt workers. There is a need for inter-professional collaboration, so that debt does not remain as a peripheral issue for those people working in mental health. The wheel does not have to be reinvented here, as there are really good assessment and communication tools already developed and pioneered and available. contact me through the blog and I'll send you the details. Mental health workers don't need to do much to make a big difference to peoples lives regarding debt and money - they just need to find out why and how.

really interesting meeting yesterday. Met with a publisher and financial capability outreach worker and educator to scope out the content of a forthcoming publication. The brief was to work out the main topics and style in a 32 page booklet . We all agreed that accessible language was important, and how difficult it was to express complicated concepts in simple but not patronising language. Also all agreed that many people are not numerate and so will be put off by complex numbers. Also, finance and debt are sensitive personal topics, and that debt carries stigma.

So, left with the important basic questions ; what are the important points that everyone needs to know in order to be able to cope best with their money, and how can these be well expressed so as to retain people's attention and aid their understanding.

Also a lot of discussion about 'needs' versus 'wants' i.e. is a the latest 32" inch flat screen TV a need or a want ? We disagreed on this as you might expect, with a range of views expressed. Difficult and subjective I think, and strays into the whole area of lifestyle and personal choices. Of course we could all manage our money if we went without electronic goods, cars, holidays, eating out, new furniture, bought our clothes second hand etc etc. But while that may be the lifestyle choice some may go for, its definitely not for all.

I'm sure that however the booklet is written it must not be, or appear to be, judgemental. So I'm going to have a go at drafting one of the sections, probably on 'budgeting'. So if any one has suggestions about how this topic can be put over clearly (why, what, how?) let me know. Incidentally the publication will use visuals / cartoons / diagrams etc, so not reliant on dense and unreadable text.

yours

creditrating

philanthropy

credit unions rely on having capital to lend out to members. Members need the loans, and the credit union needs the (small) earnings that come from charging interest on the loans. Getting started with enough capital is a real problem. Are there philanthropists out there who have money that they don't mind keeping with the credit union for a long time ? If they genuinely don't need the money for a while, then why not put it on deposit with the credit union ?

credit unions - opening a discussion

hi

I work in Cornwall UK. A dispersed rural area with market towns. Its a relatively poor area - low wages and high house prices driven up be second home ownership.

My job is as a development worker for a small credit union, to help the credit union grow. I joined them 10 months ago. It has been run by a small group of good and dedicated people giving their time and effort for free. Their values are good, and they never forget who the Union is for - people who can't access the mainstream banks and credit.

I'm working on ways to make the union better, and I'm really interested in the credit union reaching out to to people for whom life can be difficult. I've got lots of ideas about how to do that, and want to learn from others doing similar. so hope to hear from you wherever you are.

Over and out