Financial systems must not forget about the most vulnerable

Cost of living is a body contact sport, with rising prices landing the heaviest blows on those least equipped to defend themselves. Too often ‘relief’ is provided to those with the means to access it. Those in the most acute need are left to flounder.

The federal election has been called on the back of a budget laced with general cost of living ‘relief’ morsels, such as the energy bill relief that is not even means-tested.

These gestures perpetuate a dangerous fiction: that economic hardship is merely a personal, cyclical challenge, resolvable through transactional fixes. The reality is far more complex and systemic.

This hit home to me last week when I attended the 5th Financial Inclusion Conference at Kingscliff on the NSW Far North Coast. The conference brought together financial counsellors, community organisations, local government and academia to get a full picture on the pressures faced by people living on low incomes and marginalised from our society.

The scope of financial inclusion work is broad. It transcends monetary access and encompasses providing information, advice, and critical support to those under the most financial pressure—where an energy bill or rental payment becomes a source of profound anxiety.

It’s also about explaining the way systems are rarely designed to serve the most vulnerable. Take this example from the conference:

Some people in remote Indigenous communities have not used the same spelling of their name on all forms. The family history, and therefore their connection to their names, disjointed and disrupted across generations. Many don’t have wills. Some also don’t have access to a birth certificate or a driver's licence. So, what happens to a loved one’s super? They need to spend money on a probate process. This means they need to go online or have a lawyer witness their form, but there is unreliable internet access and no lawyers in their community. The super is frozen because systems designed to streamline efficiency end up making it harder for the people who are most marginalised.

Perhaps because this was the first time the conference had been held outside of Sydney, it also attracted elected representatives from local government across the state. Their presence was driven by traditional institutions like banks retreating from regional areas as they witness their own vulnerable communities become increasingly isolated. Into this vacuum rush predatory lenders, offering "junk loans" and payday lending schemes that cynically exploit financial desperation.

Financial counsellors report a grim pattern: whenever they enter a new community, exploitative financial "sharks" have already established their hunting grounds. From banking to energy to daily living costs, we are witnessing a risk shift from government offering comprehensive social insurance, to a system where individuals are left to navigate complex, impersonal and exploitative systems on their own.

More than anything else, the whole discussion reinforced the need for well-resourced place-based community hubs like neighbourhood centres in every part of NSW. We can’t control the private sector and the decisions they make, but we can provide the community infrastructure to support people in need.

Until we build these types of local structures – and maintain them with secure rather than crisis or program funding – we won’t fully appreciate the barriers or render the assistance required to those in need.

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