FINANCIAL EMPOWERMENT AS A POVERTY REDUCTION TOOL May 7, 2015
Founded in 1986, Prosper Canada is a national charity dedicated to expanding economic opportunity for Canadians living in poverty through program and policy innovation. We work with government, business and community partners to develop and promote financial policies, programs and resources that transform lives and foster the prosperity of all Canadians. We help service systems and organizations in all sectors to build proven financial empowerment approaches into their businesses in ways that: Are sustainable Help them achieve their goals Tangibly increase the financial well-being of low-income people they serve.
Pathways to prosperity for people living in poverty Source: http://cfed.org/assets/cfedhouseholdframework_4pager.pdf
Problem: The trend is going in the wrong direction Canada has the highest household debt-toincome ratio in the G-7 at 163.3% Canada s household savings rate is at an all-time low of 3.6% Nearly 1 in 4 Canadians have no financial wealth at all, including savings, stocks, bonds, RRSPs.
Financial Empowerment is an integrated approach Interventions are proven to improve financial outcomes FINANCIAL EMPOWERMENT FRAMEWORK 1. Financial Information education and counselling 2. Help accessing benefits and tax credits 3. Safe and affordable financial products and services 4. Access to savings and asset building opportunities 5. Consumer protection and awareness Strengthening financial inclusion, knowledge, behaviour and opportunities. These are key determinants of economic security, but largely missing from our current social support systems. 5
We help build a mature financial empowerment ecosystem Policy makers Researchers Funders Frontline service providers Canadians living in poverty 6
Local communities are driving change in partnership with each other and regional/national partners Developing and testing innovative interventions Integrating solutions into existing services Translating frontline insights into policy advice Building FE into Poverty Reduction Strategies Consulting with financially vulnerable people Developing & sharing new tools & resources Convening and supporting collaboration Research and knowledge sharing Building community capacity 7
There is strong evidence that Financial Empowerment interventions produces a super vitamin effect New York City s Office of Financial Empowerment funded five community organizations to build financial coaching into other programs and monitor the results. Evaluation showed that, relative to comparison groups, clients achieved more employment outcomes on average, had higher job placement rates, and earned a higher salary after one year of employment. (http://www.nyc.gov/html/ofe/downloads/pdf/research_buildingfinancialcounselingintos ocialservicedelivery.pdf) 8
1 2 3 4 5 Access to income benefits and tax credits E4C in Edmonton West Neighbourhood House Toronto Emp. & Soc. Services (Social Assistance office) Managed 26 income tax clinic sites and 320 volunteers in 2013 Helped 4,136 low-income clients file their taxes Helped 670 clients to apply for non-tax benefits they were eligible for Anticipated $1.5 million in tax refunds Fundraised to cover costs Testing Self File approach in partnership with SEDI & Intuit Manage 4 income tax clinic sites and over 20 volunteers annually Provide tax filing year-round through Financial Advocacy and Problem Solving (FAPS) program In 2012, helped over 2,000 people secure $3.9 million by accessing entitlements and addressing debt issues Share best practices with other local community organizations Expanded FAPS to 2 new locations Manage 15 income tax clinic sites and 30+ volunteers In 2013, helped 600+ people file their own taxes Job Incentive Program volunteers receive unpaid work experience and mentorship from TD volunteers Partnering with Prosper Canada and TD to mobilize corporate volunteers to support expansions of tax clinics 9
http://prospercanada.org/our-work/able-2015-conference.aspx 10
Prosper Canada 60 St. Clair Avenue East, Suite 700 Toronto, ON M4T 1N5 (416) 665-2828 www.prospercanada.org Adam Fair Director of Programs afair@prospercanada.org 416 665-28282 Ext.240 11
What Financial Empowerment initiatives exist in your community? FINANCIAL EMPOWERMENT FRAMEWORK 1. Financial Information education and counselling 2. Help accessing benefits and tax credits 3. Safe and affordable financial products and services 4. Access to savings and asset building opportunities 5. Consumer protection and awareness 12