Posts Tagged ‘Wales Co-operative Centre’
Tackling poverty runs through everything we do at the Wales Co-operative Centre; from helping people in some of the country’s most disadvantaged areas to improve their financial capability, to supporting people to get online and learn new skills that can help them back into work or start a business. We also work with social enterprises and co-operatives, to help develop stronger, more sustainable and better businesses.
Here, Jocelle Lovell, Financial Inclusion Project Manager, discusses the role of financial inclusion in tackling poverty…
This week (Tuesday, 4 November), I was invited to speak at ‘Advice & Support’, Carmarthenshire’s Network Event in the Halliwell Centre, Trinity St Davids, Carmarthen. The topic was ‘What financial inclusion really means and its significance in the fight against poverty’; the challenge was taking something that I could talk about all day and putting it into a 20 minute presentation.
So I started with the three key elements of Financial Inclusion:
- Accessibility – being able to access the financial services and products needed to participate fully in modern-day society and manage money effectively
- Literacy – having the ability to understand the words and numbers used in financial products
- Capability – having the ability to interpret the information and use it to make informed decisions appropriate to an individual’s circumstances.
Have people got the tools, the knowledge, the right environment and the confidence to manage their personal money? If not, they are financially excluded. Why is this a problem? Well here are just a few examples;
- If you do not have a bank account with a direct debit facility you will pay more for services & utilities
- Poor or no credit history may well exclude you from low interest loans from mainstream lenders (banks, building societies), often leaving no option other than high interest loans, payday loans or a worst case scenario using a loan shark.
- Your choices are limited i.e. buying a product online at the best price versus using the likes of BrightHouse or Provident
- Lack of understanding or choice can lead to ‘costly’ inappropriate decisions.
People who are financially excluded are more likely to need support from publicly funded services. The likely impact of paying more for their products and services is that they will remain in poverty. Living in poverty is becoming a social norm. Poverty is not a new problem, but following the recent years of economic decline, it is becoming more and more prevalent across our communities. There are many good initiatives across Wales that are trying to address these issues, both locally and nationally. But we still have 1 in 5 working and non working households across Wales living in poverty (Joseph Rowntree Foundation: Monitoring Poverty and Social Exclusion in Wales), along with:
- Increased demand on foodbanks
- Increased high street presence of modern day pawn brokers and loan companies
- Increased demand for Discretionary Housing Payment (DHP)
- Increased number of services being transferred online banking, welfare benefits
- Closures of local banks and post offices.
So tackling financial exclusion must be a priority if we are to reduce the number of people living in poverty across Wales. For many, this will mean changing attitudes and behaviors towards money and educating people on the responsible options available.
Where there is challenge, there is opportunity…
In light of Welfare Reforms, reduction in public spending and recommendations from the Williams Commission, is now not an opportune time to radically rethink how we deliver services, fund local delivery strategies and generate sustainable job creation?
eud y defnydd gorau o’r rhyngrwyd a thechnoleg ddigidol.
Three important business launches in one week show the strength of the social enterprise sector in North Wales
September 2014 is a busy and exciting month for social businesses in North Wales this year. There are three major new project launches throughout the month, culminating in the Social Enterprise Wales 2014 Awards and Conference in Glasdir.
Ynni Anafon Energy Community Share Scheme
Last Saturday, 13th September, Ynni Anafon Energy, the Industrial Provident Society (IPS) behind the plan to build a 270kw hydroelectric plant on the River Anafon in Abergwyngregyn, Snowdonia launched its Community share scheme.
Ynni Anafon Energy is hoping to raise £1.25 million for the project via the share scheme and a bank loan. Shares are now available to investors aged 16 and over. Shareholders will earn interest on their investments and have one vote each regardless of whether they invest the minimum sum of £250.00 or the maximum of £50,000.
The project will earn around £30,000 per year for the community whilst the bank loan is being repaid with a higher yearly income forecast after that. By forming an Industrial and Provident Society, Ynni Anafon Energy will benefit the local community. The electricity generated will be sold to the grid through the government’s Feed-In Tariffs (FIT) scheme. Surpluses will be donated to a village charity and boosted by the tax efficient Gift Aid incentive.
Gavin Gatehouse is one of the three founder-directors of Ynni Anafon Energy, he said:
“The Anafon Hydro is an excellent opportunity to invest in a profitable business and support Abergwyngregyn. The structure of the IPS keeps control of the organisation out of the hands of large organisations and, instead, channel funds into village causes and the wider community.”
The Wales Co-operative Centre was happy to be able to support Ynni Anafon Energy with development of its share offer.
Thursday 18th September sees the launch of Draig Tex a new social enterprise founded by a consortium of three not-for-profit organisations within North Wales, Crest Co-operative, Seren Ffestiniog Cyf and Antur Waunfawr. The social enterprises all collect and sort textiles and sell the products in their respective shops. Previously the three enterprises worked with external, national companies to export textiles. Now however they have teamed up and will work together to export the textiles themselves. The aim is to keep the value of textiles and unwanted clothing in Wales to support the work and social values of the social enterprises and therefore benefit Welsh communities.
Sharon Jones is Chief Executive of Crest Co-operative, one of the three partners involved in Draig Tex. She said,
“Any charity or social enterprise that collects textiles can now choose a Welsh third sector service that will offer competitive market rates for most of these materials. The aim is to help keep the value of textiles collected in Wales as close to local communities as possible and to reinvest in the Welsh social economy, rather than see wealth leak away into a global market, as often happens now.
“We are grateful for the support we have received from the Wales Co-operative Centre in helping us build the framework we needed to implement this new business approach”.
The Wales Co-operative Centre’s Succession and Consortia Project worked closely with the three partners in Draig Tex to help them to form the consortia and develop the business approach and governance for the new organisation.
The Rabbit Hole Café & Wellbeing Centre
The Rabbit Hole Café in Llandudno will be launched at an event on Friday 19th September.
The Café is a Social Enterprise set up by Aberconwy Mind, a registered mental health charity, and will provide work experience and training for people who have experienced or are experiencing mental health issues. All of the café’s profit will be put back into the charity to continue delivering support, training and mentoring for their trainees.
The Wales Co-operative Centre helped Aberconwy Mind to develop their business plan, their memorandum and articles and their Company Registration. They also helped with HR support and equality and diversity policies. The new enterprise has been assisted with specialist marketing advice and with a training session on the roles and responsibilities of directors.
At the Wales Co-operative Centre we welcome the breadth of innovation that is demonstrated by these three projects. All are set up to address specific needs in their communities and all are designed to employ people and be sustainable over the long term.
We wish them all every success in the future.
The Wales Co-operative Centre runs a number of projects that promote financial inclusion and that provide advice on money management. These projects are a key part of the Centre’s role in developing and implementing solutions to strengthen communities and promote inclusion in Wales. Jo Lovell, who manages one of these financial inclusion projects, blogs about a recent announcement on the Robust Trialling of the Local Support Services Frameworks that will support claimants through the transition from the current benefit system to Universal Credit.
Last week saw the Minister for Welfare Reform, Lord Freud, announce a series of new trials to help claimants get ready for Universal Credit along with the 11 partnerships that have successfully bid to deliver this local support. It is really encouraging to see that two of the 11 sites are in Wales; Blaenau Gwent and Carmarthenshire County Councils.
‘The trials will be partnerships between jobcentres and local authorities across Great Britain, who will be supported by third sector organisations, voluntary groups and social landlords. Each trial will be different, focussing on local need. They will look at the best way to prepare claimants for the world of work, by helping them with online access and digital support and managing their finances on a monthly basis.’
Universal Credit will by replace 6 different benefits and tax credits with a single monthly household payment. It includes support for the costs of housing, children and childcare, as well as support for disabled people and carers. Concerns have been raised since the first mention of Universal Credit by tenants, and both support and housing providers. Many of whom feel that people will struggle due to their lack of financial capability and digital exclusion.
At the Wales Co-operative Centre we are really pleased to be one of the third sector organisations supporting Blaenau Gwent, in this key piece of work that will help to shape the final framework in 2015. It is an exciting opportunity that will see financial and digital inclusion brought together.
Over the last few months, the Tackling Homelessness through Financial Inclusion (THFI) project has worked with Blaenau Gwent to assist them in mapping the local support services, that will be essential for supporting residents through forthcoming changes to their benefits, as well as delivering financial inclusion awareness sessions to front line workers in the borough. The Wales Co-operative Centre is delighted to continue working in partnership with the Council in this exciting new phase of preparing for welfare reform.
The Wales Co-operative Centre runs a number of projects that promote financial inclusion and that provide advice on money management. These projects are a key part of the Centre’s role in developing and implementing solutions to strengthen communities and promote inclusion in Wales. Jo Lovell, who manages one of these financial inclusion projects, blogs about todays BBC News report on tenants affected by a housing benefit cut in England.
BBC News has today reported that “More than half of tenants affected by a housing benefit cut in England were in arrears five months after the changes were introduced.
“Some 59% of tenants – more than 300,000 – were in arrears, analysis for the Department for Work and Pensions (DWP) found. But a DWP spokesman said “around 50% of Housing Association tenants were in arrears before the changes.”
The government said its reforms were tackling “welfare dependency”.
The changes to housing benefit in England, Scotland and Wales – dubbed the “bedroom tax” by critics, but described by Ministers as the removal of a “spare room subsidy” – were introduced in April last year.
If tenants are deemed to have one spare room, the amount of rent eligible for housing benefit will be cut by 14%. Those with two or more spare bedrooms have had reductions of 25%.
One in five people in arrears had paid nothing towards this. Researchers found widespread concern that those who had paid, had borrowed or made cuts to other essentials.
People were already struggling to manage their finances, but the introduction of the bedroom tax has only exacerbated this situation. Back in November 2014, Community Housing Cymru reported that “78% of their members had seen a spike in rent arrears since the introduction of the bedroom tax.” Now 15 months on from its introduction, we are really starting to see the true long term impact on both tenants and housing providers.
Our experience here at the Wales Co-operative Centre, tells us that tenants will find ways to make up additional payments in the short term, but they can’t sustain them over the longer term. To keep a roof over their heads, tenants will either have to make cuts in spending, and for some this will be the choice of heating or eating, whilst others will be forced to make the ill informed choice of borrowing money (usually at a high interest rate), which will ultimately push them into further financial difficulties and an increased risk of becoming homeless.
It seems to me that there are several different issues here:
- The lack of affordable housing for tenants to downsize
- Tenants financial capability
- Training for frontline workers
Through the various projects managed at the Wales Co-operative Centre, we are supporting all of the above issues.
Through our Tackling Homelessness through Financial Inclusion (THFI) project, we are working closely with tenants and housing providers to improve peoples financial capability and access to advice and support they require, but this can be very challenging as it requires a change in behaviours, and we know all to well this doesn’t happen overnight. Our Financial Inclusion Champions project is helping to address the training needs of frontline workers in Wales, whilst our Co-operative Housing project, is keen to work with people interested in establishing a pioneering co-operative housing scheme. That could address the lack of appropriately sized affordable housing.
This report certainly highlights the need for more resources to be made available to support tenants who are struggling to make ends meet, training for frontline workers and for more community led affordable homes to be build.
The Wales Co-operative Centre runs a number of projects that promote financial inclusion and that provide advice on money management. These projects are a key part of the Centre’s role in developing and implementing solutions to strengthen communities and promote inclusion in Wales. Jo Lovell, who manages one of these financial inclusion projects, blogs about a recent review of Indebtedness in Wales….
This month, we saw the publication of a report “Overview of indebtedness, low income and financial exclusion” by the Bevan Foundation, on behalf of Public Policy Institute for Wales.
What it told us, was whilst some surveys suggested “that credit was less widely used in Wales” and statistically the financial liabilities of households in Wales using credit was the lowest in the UK. The report did indicate that parts of Wales, in particular the central and eastern valleys had exceptionally high levels of indebtedness linked to socio-economic disadvantage. The North Wales coast also has a higher level of debt related problems.
From this and other report’s, we know that indebtedness isn’t isolated to low income households, but the evidence suggests that they are more likely to be affected. Our own work at the Wales Co-operative Centre through the Tackling Homelessness through Financial Inclusion (THFI) project and Financial Inclusion Champions has shown that low income households are less likely to be able to access affordable and responsible credit, often leaving them with no other option than high interest and sometimes illegal money lenders.
Nearly all households will use credit at some time or another, and for many, it remains manageable even when interest rates rise or the cost of living increases. But circumstances beyond our control, losing your job or becoming unable to work because of their health, can rock and even sink the steadiest of ships.
The current landscape suggests that 16% of adults in Wales are already over indebted and struggling/failing to make repayments, of which 50% are on low incomes. It seems only fair to suggest that things can only get worse, given the recent speech from Mark Carney, Governor of the Bank of England, that interest rates may rise sooner than predicted.
Debt is a very emotive subject, and for many people it brings with it a sense of failure and lack of control. Until we change this perception, people will continue to “bury their heads in the sand” (Bevan Foundation report: Overview of indebtedness in Wales, May 2014). Not withstanding the many good campaigns and posters promoting free debt advice and support, more needs to be done so people feel able to talk about the debt without being ashamed.
This is where we all have a role to play:
- Being able to spot the signs that somebody may be in financial difficulty
- Knowing what free debt advice and support is available locally for people to access
- Not to be judgmental, be supportive in helping people seek advice
- Promote greater awareness of debt, let’s make it the norm that people can discuss debt without feeling ashamed.
- Promote self help where possible using websites like:
- Money Made Clear Wales
- StepChange Debt Charity