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The Minister for Superannuation and Corporate Regulation, Senator Nick Sherry, on 7 May congratulated Wesley Mission on its new research report, Financial Stress: The hidden human cost.

He said the report powerfully highlighted the grim effects of financial stress on society but also lit a path towards hope.

Superintendent/CEO, the Reverend Keith Garner, launched the report at a gathering of Sydney media at Creditline’s inner Sydney office in Surry Hills, said that in advocating on behalf of people who were suffering, Wesley Mission valued the use of empirical evidence to back its advocacy.

In his address, Mr Garner stressed the report’s recommendation that financial literacy campaigns be geared to engage people pertinently at specific stages of the life cycle.

Mr Garner said that Wesley Mission was called on to help people with a matrix of human needs, and that research that created reports such as this, following the earlier Wesley Reports on financial stress (2006) and other reports on mental illness, adversity in childhood and homelessness, were valuable in bringing an evidence-based approach to assisting people in distress and at the point of crisis.

In recommendations incorporated in the new research report, Wesley Mission called for strict safeguards that would protect people from unscrupulous lending practices or, even in good conditions, from venturing unwarily into depths of debt that would engulf them.

Senator Sherry indicated that the Federal Government was solidly behind Wesley Mission’s concerns in initiating new legislation to answer those very concerns

He said that increasing financial literacy – a key recommendation of the report – was regarded as such a priority that the Rudd Government had set up an Office of Financial Literacy and tasked it with a national scope.
The Government would embark on a long-term project to improve financial literacy throughout the community, starting at school level.

The Government’s new Financial Services Modernisation Bill would crack down on irresponsible lending, Senator Sherry said: “In essence, consumers can’t be put into a product that they cannot afford to pay for”.

There will be “tough new licensing requirements” for all lenders. Existing lenders will need to re-apply for licenses and be vetted before licenses are re-issued. The Government would set up independent tribunals to cover the entire sector.

For the first time, Australia will have a single national regulation of all financial providers. Thousands of providers who are currently regulated by different states will be shifted to a single Commonwealth jurisdiction,” Senator Sherry said.

“Margin lending, an area of significant controversy, will be closely regulated.”

“ASIC is to receive some $70 million and 200 extra staff to monitor this massive job of regulation,” he said.

The new report is available at: www.wesleymission.org.au/financialstress.

- Dinoo Kelleghan, Public Affairs Officer