Janeka Rutherford-Busck is a Policy Adviser at FinCap
Tell us about your role as policy advisor at FinCap and what got you into it?
FinCap is a not for profit supporting free financial mentoring. Our purpose is to enable and enhance financial wellbeing in Aotearoa. In 2022 financial mentors went above and beyond by assisting almost 50,000 whānau across the motu. In the policy team at FinCap we provide recommendations for addressing systemic issues that financial mentors raise. Our areas of priority are debt to government, improving and strengthening our credit law, and pushing for regulation of debt collection in Aotearoa. In particular I focus on reducing child poverty, which has lead me to concentrate primarily on issues with the creation and collection of debt to government because it impacts whānau with children disproportionately.
I studied social policy and political science at university, and volunteered at the Wellington City Mission while studying. After university I worked as a financial mentor. The barriers that many of the whānau I worked with were facing were extensive, complex and systemic. I often saw the same lenders behaving rudely or lending irresponsibly, and similar issues with government departments not treating whanau with respect or providing support. Seeing these issues repetitively gave me the push to head into policy work, to use what I could of my degree to look at the root causes for some of these issues.
What is something people might not know about the work you do?
Many of the whānau that financial mentors work with are already incredible budgeters with strong financial literacy. Many of the key barriers result from power imbalances and structural injustices. People have been repeatedly let down and justifiably no longer have trust in engaging with supports on offer.
A second this is that in Aotearoa 62 percent of those with debt to a government department are parents or share an address with a child. Financial mentors regularly raise issues with the inconsistencies and injustices whānau face when they have a debt to a government department, and how often ending up in debt can be a surprise they have tried hard to avoid.
What have you seen make the biggest difference for whānau you work with?
The amazing mahi that financial mentors do across Aotearoa makes a massive difference to so many whānau. We hear every day from financial mentors all across Aotearoa who have important expertise to support whānau to head in the direction of financial wellbeing. They listen and work together using a strengths based approach to use the skills and experience of the whānau they are working with. As mentioned above, often these whānau have amazing capabilities, they are just dealing with many compounding and intersecting challenges at one time and having to make hard calls.
If you or anyone you know is stressed about money or debt then our MoneyTalks service is the gateway to finding your local financial mentor and other support.
What new trends are you seeing for whānau in this economic climate?
We recently completed our inaugural Voices report, which aggregates data from Client Voices, the client management tool that most financial mentors use. From this data we could see that in 2022 whanau were spending more than they were earning. The median expenditure as a percentage of weekly income decreased slightly across Client Voices in 2022, to 104.3 percent of income. The median percentage of income that clients were spending on debt was higher than expenditure on electricity, fuel, or clothing. If whānau did not have to pay back such large amounts of debt, then they would not be in a deficit and could begin a journey towards financial wellbeing.
Another trend we could see in this report was that the amount and number of debts owed to government departments increased between 2021 and 2022, with more debt owed to government departments than banks in 2022. The Voices report will be produced annually, and we look forward to the 2024 report revealing the trends from 2023. We expect to see more of the impact of the increased cost of living and severe weather incidents.
Tell us about the most rewarding moment in your work
Earlier this year the debt to government framework was implemented, and it was amazing to see the recommendations from the sector included in the framework. Financial mentors are passionate about this issue and provided FinCap with many important insights. There was strong collaboration to get the FinCap and supporting submissions together, which helped to progress the final framework. It was fantastic to see the collaboration and to see the voices of financial mentors listened to through consultation. If this guidance is implemented we will see many more whānau back on track towards financial wellbeing.