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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. Whose Rules Rule? National Bulk Debt Project. Denis Nelthorpe, West Heidelberg CLS

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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

whose rules rule national bulk debt project

Whose Rules Rule?National Bulk Debt Project

Denis Nelthorpe, West Heidelberg CLS

Julie Maron , Legal Aid NSW

Aimee Cooper, Victoria Legal Aid

September 2011

why bulk debt
Why “bulk debt”?
  • 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
bulk debt the rules
Bulk Debt – the Rules
  • 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
whose rules rule
Whose rules rule?

Financial Counsellors are subject to rules from:

  • Governments, Regulators, Ombudsman
  • Creditors and Debt Collectors
  • Hardship teams
  • Community Agencies + Funders
when the rules won t work
When the rules won’t work…
  • 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
play by your own rules
…play by your own rules!
  • 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
your rules are not made to be broken
Your rules are not made to be broken!
  • 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.
bulk debt 2 0
Bulk Debt 2.0
  • 12 months expanded project
  • WH CLC, VLA, NSW LA
  • National collection through website
  • 450 Agencies and workers registered to participate
national bulk debt project creditors
National Bulk Debt Project creditors

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
national bulk debt project centrelink recipients
National Bulk Debt Project Centrelink Recipients
  • Aged Pension 11%
  • Carers 5%
  • DSP 41%
  • Newstart 20%
  • Parenting 18%
  • Other Centrelink 5%
  • No income 2%
national bulk debt project
National Bulk Debt Project

Progress Report - ?

national bulk debt project1
National Bulk Debt Project

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
www bulkdebt org
www.bulkdebt.org
  • From 30 June 2011 until 30 July 2012
  • Website looks like this:
our rules for other debts
Our rules for other debts
  • 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
bulk debt the rules1
Bulk Debt – The Rules
  • Expect respect!
  • Provide information with integrity
  • Act in the best interests of your client
  • Be in it for the long haul!