Community groups in country areas to be consulted on no-interest loan scheme

17/3/99
Family and Children's Services Minister Rhonda Parker said community groups in country areas would have the opportunity to put their views about the State Government's no-interest loan scheme at a video conference on Friday, March 19.
"Confirmations to take part in the scheme's consultation process through Westlink have already been received from Carnarvon, Derby, Esperance, Geraldton, Harvey, Northam, Kalgoorlie and Karratha," Mrs Parker said.
"Groups in other towns can still apply to take part in the consultation.
"The scheme, with funding of $1.5 million over three years, will be run by not-for-profit groups around the State.
"The loans of up to $1,000 aim to prevent people on low incomes from falling into the poverty trap. They will help families and individuals meet unexpected expenses without having to pay the high rates of interest some lenders charge borrowers seen as a credit risk.
"The loans are a catalyst for change and have many advantages over a hand-out. Research shows they lead to improved financial management skills and increased self esteem and confidence which are important factors in avoiding poverty."
Mrs Parker said the no-interest loans scheme would absorb the current Furniture Loans Scheme operated by Family and Children's Services since 1993.
The Furniture Loans Scheme and research commissioned by the Poverty Task Force had revealed problems with Government agencies operating such schemes.
"There is a perception that you don't need to pay back money borrowed from Government departments. The repayment rate is far higher if the loans are made by community-based agencies to people living in the same community," Mrs Parker said.
"People know that repaying their no-interest loan will mean that someone else in their own community will be able to benefit in the future."
The no-interest loan scheme is a recommendation of the Poverty Task Force and based on a research project by Anglicare, Fremantle Community Legal and Advocacy Centre and Sussex Street Community Legal Service.
Further information about the video conference can be obtained from Vanessa Harvey on 9222 2716.
Media contact: Owen Cole 9481 7810