Financial Inclusion, Advice & Equalities

Financial Inclusion, Advice & Equalities Paul Sweeting, Brighton and Hove Advice Strategy Project. 09/09/11

Today's presentation…. • Overview of the Advice Partnership and Advice Strategy Project • Introduction to Financial Inclusion & relationship to advice services • Outline of ‘where we are’ with advice services, the broad direction of travel and next steps • Discussion: your views and input…

1. About the Advice Partnership & Network Brighton and Hove Advice Partnership • Formal partnership under LSP since 2006. • Responsible for the ‘Advice and Information’ area of the Sustainable Community Strategy and • Responsible for the development of the Financial Inclusion Strategy for the City. Advice Services Network • Long standing local network established in 1980’s • Holds regular, meetings open to all with an interest in advice issues • Chair of ASN holds vice chair position on Advice Partnership

About the Advice Strategy Project • Funded by BLF ‘adviceplus’ programme (following voluntary sector led partnership bid.) • Currently one project officer hosted by BHT • Responsible for • Facilitating and supporting the Advice Partnership and ASN • Embedding advice provision strategically in the city & progressing the Partnerships strategic aims • Supporting the local advice sector to respond to commissioning, increase access and implement benchmark quality standards

2. What does ‘Financial Exclusion’ mean? • Relates primarily to income inequality and poverty. • Describes a particular injustice with income inequality – the lower the income, the more things often cost e.g.: • Credit may cost more • E.g. people on lower incomes may be less able to access affordable credit • Fuel costs are often higher • E.g people on lower incomes may be more likely to pay for fuel via key meters & more likely to live in poorly insulated homes • Consumer goods may cost more • E.g. people on lower incomes may be less likely to purchase goods via the internet

Components of financial exclusion The Financial Inclusion Taskforce (set up by the previous Government in 2004) listed the six key components to financial exclusion as lack of access to[1] • bank accounts • affordable credit • Money advice • Insurance • Savings • Assets [1] (HM Treasury (2004a) Promoting Financial Inclusion, London HM Treasury)

Current government position The current Government expressess it’s commitment to tackling financial exlusion as follows: ‘The Government believes that banks should serve the economy, and is committed to improving access to banking and the transparency of financial products for consumers. Tackling financial ‘exclusion’ will help alleviate some of the problems faced by many low-income families who are currently unable to use mainstream banking services. The benefits include being able to receive payments through a variety of channels, having a more secure place to keep money and reducing the cost of household bills. Consumers should also be able to trust the products and services available to them and have a wide range of choice.’

Local (draft) definition Participants in the Advice Partnerships Financial Inclusion workshop earlier this year recommended the following definition: Financial Inclusion means having enough resources to meet basic needs adequately and to be able to make choices over a prolonged period, to maintain physical and mental well-being, and participate in community/society

Financial Inclusion and Advice Services Advice Services assist people with difficult legal problems related to money and financial/social exclusion. Specifically • Debt But also a ‘cluster’ of related problems: • Welfare Benefits and Tax Credits • Housing • Employment rights • Community Care • Immigration • Consumer issues • Family Breakdown

Advice need in the City - location Source – Legal Services Research Centre: likely incidence of Social Welfare Law problems by LSOA (brown indicates highest incidence, light blue indicates lowest)

Current advice provision in the City - location Source – Advice Strategy Project mapping of advice services

Tackling Financial Inclusion – the bigger picture Provision of advice is only part of a strategic approach to Financial Inclusion. Other key strands include: • Provision of accessible financial services (e.g. through Credit Union) • Provision & promotion of financial education & literacy support • Embedding financial inclusion in local policy & procedure …so, why the initial focus on advice services?

3. Advice and Financial Inclusion – where we are and where we are going Advice services face an imminent ‘perfect storm’ whereby: • Need for Financial Inclusion related advice is likely to increase • Welfare Reform (Housing Benefit, Disability Benefits, ESA, Universal Credit) • ? Economy (unemployment, inflation vs wages, interest rates) • Supply of advice is likely to decrease and the sector may face destabilisation • Legal Aid Cuts (c£1m cuts to specialist provision in Brighton & hove) • Other public spending cuts Immediate action is required to prevent crisis

Advice & Financial Inclusion – the direction of travel • Exploring ‘hub and spoke’ model • collocation of specialist agencies • Access via libraries / community venues • Maximising on line self help where appropriate • Supporting advice delivery through volunteers • Integrating advice provision with broader Financial Inclusion support • Benchmarking quality Local Authority position : • Considers Financial Inclusion and the provision of advice as a strategic priority • Aspires to a single, commissioned contract for ‘advice services’ for the city

Advice & Financial Inclusion – the next steps • Identify potential advice/Financial Inclusion ‘hub’ venues • Explore the development of the ‘Centre for Independent living • Make & implement recommendations around quality benchmarking • Develop pathfinder projects to be delivered in partnerships & to test new ways of working

Advice & Equalities The Brighton and Hove Advice Partnership is seeking to understand: • The relationships between membership of equalities groups and likely need for advice (and risk of financial exclusion) • The relationships between membership of equalities groups and access requirements for advice services This understanding will inform our recommendations to the Council on the commissioning of advice services

Advice, Financial Inclusion & Equalities – what evidence to we have already? The Advice Partnership has examined a range of local and national evidence addressing these areas, for example: • Nationally, the Government Equalities Impact Assessment indicates Legal Aid cuts are likely to have a disproportionate negative impact on women, disabled people and people from BME backgrounds. • Young people are more likely to experience a range of ‘social welfare law’ problems and less likely to access advice (Youth Access / Civil Justice Survey) • Strong & complex relationship between debt problems and mental health (LSRC)

Advice, Financial Inclusion & Equalities – Questions for the Equalities Network • Advice need & risk of financial exclusion which equalities groups are more likely to need advice (or be at risk of financial exclusion)? How is this likely to develop as the welfare reforms are implemented? • Accessing advice Do advice services currently reach those most in need - what works well and what are the barriers relating to equalities? What are the barriers relating to online self help & equalities? How could a ‘hub and spoke’ model be developed so that barriers to access are minimised? • The ‘draft definition’ of Financial Inclusion How well does this capture the ‘equalities’ dimension? Any recommendations for changing it?

Contact Paul Sweeting Brighton and Hove Advice Strategy Project paul@advicebrighton-hove.org.uk

Financial Inclusion, Advice & Equalities