1. FCAWA 2011 CONFERENCE Coming Together is a Beginning. Keeping Together is Progress. Working Together is Success. Bulk Debt Negotiations Dennis Nelthorpe OAM-Footscray Legal Centre 1

2. Denis Nelthorpe, West Heidelberg CLS Julie Maron, Legal Aid NSW Aimee Cooper, Victoria Legal Aid September 2011

3.  Centrelink recipients – no assets  Multiple problems including: ◦ Homelessness or threat of eviction ◦ Mental illness ◦ Illness and chronic ill health ◦ Alcohol and drug addiction  Clients with serious social problems and some associated debt  Not Debtors with associated social problems

4.  Purpose of Centrelink Payments ◦ Keep a roof over head! ◦ Keep food in the fridge! ◦ Keep the lights on!  Centrelink Income is Protected ◦ Section 60 Social Security (Admin) 1991 ◦ Section 12 JDRA (Vic)  Best Practice in Debt Negotiation ◦ Effective and efficient use of resources ◦ Financial Counselling is a valuable resource

5. Financial Counsellors are subject to rules from:  Governments, Regulators, Ombudsman  Creditors and Debt Collectors  Hardship teams  Community Agencies + Funders

6.  Periods of Hardship – internal accounting definitions  Prudential definitions of hardship – an urban myth - Unrelated to client hardship  Capacity to negotiate – are they “allowed”?  Working to a script – Don’t participate

7.  A Financial Counsellor is entitled to expect: ◦ A competent negotiator – two way discussion ◦ A knowledge of hardship + Centrelink Refuse to negotiate with unqualified staff ◦ Seek a manager or IDR

8.  Provide an authority once - only  Refuse to provide unnecessary information  Financial profiles are often unnecessary – refer to SACOSS statistics on costs of living  Centrelink Statements contain required information.

9.  12 months expanded project  WH CLC, VLA, NSW LA  National collection through website  450 Agencies and workers registered to participate

10. A total of 1494 debts collected = $7.4 million  Credit Corp 242 debts  Baycorp 240 debts  GE Finance 353 debts  ACMS 182 debts  Telstra 341 debts  AGL 126 debts

11.  Aged Pension11%  Carers 5%  DSP 41%  Newstart 20%  Parenting 18%  Other Centrelink5%  No income2%

12. Progress Report - ?

13. Next Round of Collections  Likely to begin in late February 2012  Concentration on Banks: ◦ CBA + Westpac ◦ Citibank + HBSC  Debt Collection companies: ◦ Collection House – Lion Finance  Utilities –May depend on funding + partners: ◦ Origin + TXU ◦ Optus + Vodafone

14.  From 30 June 2011 until 30 July 2012  Website looks like this:

16.  EDR financial hardship submissions – Application to EDR based on financial hardship – Acknowledgement Centrelink income protected – Acknowledgement client can’t pay – Finding that it is not fair or reasonable to continue to contact the debtor – Creditor required to advise any debt-buyer – Limit contact with the debtor - only to determine whether their circumstances have changed

17.  Expect respect!  Provide information with integrity  Act in the best interests of your client  Be in it for the long haul!