As we come into a new year, it is timely to reflect on some recent events and developments, and what they tell us about the challenges our sector faces. As a reference point, I think it is important to keep in mind our Vision as stated in the FCVic Strategic Plan 2022-25: ’A fairer and more equitable society with improved community wellbeing and better lives for vulnerable people’.
In the second half of 2022, demand for financial counselling from people struggling with debt and poverty continued to increase, with many services reporting lengthy waits, even closures of waitlists, along with rigorous triage at intake in order to manage demand. Nevertheless, in November we found out that RMIT had made the decision to cease offering the Diploma of Financial Counselling from the start of 2023, pointing to the lack of job opportunities for graduates as their main concern. At the same time, there have also been chronic difficulties for agencies in some Victorian regions trying to recruit financial counsellors.
These issues highlight the risks for the sector due to leaning on a tiny labour market for financial counsellors in Victoria – our current estimate is of 310 practising financial counsellors statewide, the majority of whom are part-time. The sector is so small that it lacks critical mass and is vulnerable to burnout and retirements. It also lacks the capacity to ramp up in size quickly to respond to sudden demand shocks arising, for example, from disasters or significant inflation.
These issues were of deep concern to FCVic prior to the pandemic, and as things go back to pre-pandemic levels of demand, they have come back as an important and urgent challenge for us and for Government. We will be making submissions to Consumer Affairs Victoria in the first part of 2023 about how to find a way forward in addressing these challenges.
Sector viability is a challenge in other states as well and has helped drive the agenda for bringing forward industry funding for the sector at the Federal level. Proposals for how this will work have been put forward for consultation, and FCVic, along with other state bodies, made a submission in that process. Two key points in that submission were made. First, about our concern that the voluntary model for industry funding has the potential to embed conflicts of interest in the funding processes. Second, the importance of State Government funding of financial counselling as a service needing integration with other State Government funded social, community, health and legal services. In Victoria, approximately two thirds of our sector funding comes from the State Government. In our view, there is a need, separately from industry funding, to design Federal-State funding arrangements, as are used in other service sectors, to enhance State funding levels and ensure strong coordination and organisation of services at the State Government level, which is most experienced with service delivery and closest to the community. We are waiting with interest to see how the Department of Social Services responds to the submissions it received.
Lastly, to end on really positive note, after some years of debate and discussion, in December 2022 Financial Counselling Australia through its state/territory member bodies adopted a new set of National Standards for Membership and Accreditation, taking effect in January 2024. The new standards follow FCVic’s lead in establishing the new category of student member distinct from the Associate member category (which is for new graduates in the first two years of practice). What was the ‘Full member’ category will now become the ‘Accredited member’ category with accreditation processes to be developed for the transition from Associate member during 2023.