Submission: Inquiry into the extent and nature of poverty in Australia

Below is a preview of Redfern Legal Centre's submission to the inquiry into the extent and nature of poverty in Australia.

Financial abuse

There is an obvious link between financial abuse and economic hardship. In the last financial year, 95% of the clients of our Financial Abuse Service were experiencing financial hardship. Since launching our service in 2019, we have assisted over 550 victim-survivors across NSW to resolve their legal and financial problems and regain their financial independence. In our first year alone, we helped our clients waive $600,000 of debt and recover $240,000 in compensation after financially abusive relationships. Our clients report that our legal assistance has also improved their safety, their knowledge of the law and legal system and their stress levels.

Costs to the victim survivor

Domestic and family violence (DFV) is the leading cause of homelessness for women and children in Australia, and access to secure housing is critical to address poverty.¹ Women who choose to leave abusive relationships often end up in poverty due to a lack of government support.² The limited data available on single mothers and violence indicates that they experience DFV at a much higher rate than the rest of the population.³ There has been recent evidence that economic stress related to the COVID-19 pandemic and lockdowns was associated with increases in both the onset and escalation of domestic violence.⁴ Domestic violence was already a critical factor leading many victim survivors to experience poverty, but the onset of the pandemic has further compounded this for many Australians.

Costs to the economy and Government

Financial abuse is estimated to cost victim survivors and the Australian economy a combined total of $10.9 billion per year.⁵

Addressing financial abuse and reducing poverty

Addressing financial abuse by providing holistic support for victim survivors will assist in reducing poverty in Australia. A national program of dedicated financial abuse services in each state and territory, co-located with an established community legal centre, would support victim survivors on their journey to financial independence and empowerment and significantly reduce the costs of financial abuse for Government, the Australian economy, and victim survivors themselves. 

Download our full submission below. 

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¹ Flanagan, K. et al. (2019) Housing Outcomes after Domestic and Family Violence (AHURI Final Report No. 311, April 2019) 7.

² Summers, A. (2022) The Choice: Violence or Poverty. University of Technology Sydney. Available here.

³ Ibid

⁴ Morgan, A. and Boxall, H. (2022) Economic insecurity and intimate partner violence in Australia during the COVID-19 pandemic (Research report, 02/2022). ANROWS. Available here.

⁵ Deloitte Access Economics (2022) The cost of financial abuse in Australia (Commonwealth Bank of Australia).