10 Feb 2015
The business case for social investment is sound: successful programs can create ‘shared value’ for communities and organisations, offering businesses improved reputations and access to new markets.
"Savings from programs [like Saver Plus] are of economic benefit to the Australian community as well as individual households."
Jane Nash, Group Head of Corporate Sustainability and Financial Inclusion at ANZ
In Australia, the financial services sector offers a litany of community programs. Here at ANZ we have our Saver Plus program which has been widely acknowledged as a successful, cross-sectoral program of which we are very proud. But there are other important programs such as the Commonwealth Bank’s StartSmart program delivered in schools.
Saver Plus is aimed at increasing the household savings of people on lower incomes. Program participants learn money management skills and their confidence in financial decision-making is improved.
The program plays an important role in improving financial literacy, a challenge seen as vitally important by the Australian Securities and Investments Commission. ASIC is aiming to lift the understanding of consumers and retail investors.
According to ASIC’s Peter Kell, such programs can help strengthen the demand side of the market, in financial services, enabling consumers to be confident and informed when engaging with products and services.
Added to this, the Financial System Inquiry’s recent report noted the importance of financial literacy strategies in building confidence and trust in the financial system.
In 2003, ANZ began working with not-for-profit organisation the Brotherhood of St Laurence on a program aimed at encouraging people on lower incomes to save. Together we designed and developed Saver Plus, which today operates across Australia. More than 500 ANZ branches refer people to the program.
The recognition the program has garnered is evidence it represents a best practice example of community-business-government partnership, with ANZ providing its expertise and resources to the mutual goal of increased financial capability for lower-income Australians.
Programs like Saver Plus and others initiated in the private sector can increase personal savings and contribute positively to national savings. Saver Plus does this in two ways, by encouraging household saving and by reducing welfare dependency.
Saver Plus partner organisations include The Smith Family, Berry Street and The Benevolent Society, each of whom have supported ANZ and BSL in the national governance and development of the program since its inception and are responsible for their own service delivery across Australia.
Since its inception, Saver Plus has enrolled over 23,000 people across 60 locations and has been supported by the Australian Government since 2009.
Behind the success
The numbers that detail the success of Saver Plus speak for themselves. Almost 15,000 participants had completed the program by July 2014, saving over $13.5 million. The program offers dollar-for-dollar matched savings up to $500, meaning corresponding payments of $10 million have been made by ANZ.
While these sums are small in comparison to the total amount saved across the entire Australian economy, their value for those involved (and their communities) is far greater. Just as Saver Plus has grown over the last decade, it is likely that these benefits will also grow in the future.
Since 2009, Australian Government assistance to Saver Plus has been a catalyst for $16 million in private sector spending on education; with a social return on investment of at least $3.98 for every dollar of public sector funds. Savings from programs like this are of economic benefit to the Australian community as well as individual households.
Saver Plus has been targeted towards savings for education, the greatest contributor to economic and social mobility, which in turn reduces welfare dependency. With an aging population, we know that the public sector will be less able to provide for people’s retirement than previously.
A small amount of savings enables individuals to better deal with emergency situations, reducing the call on various public and private sector agencies that may be required to provide assistance.
Saving is also the first step toward investing, which done conservatively can greatly assist individuals’ long-term financial security.
Any program that is able to assist people to plan and provide for the future will have benefits for participating individuals as well as public savings. Saver Plus is assisting to create a culture of saving not just among the participants but also their families and their communities, providing ongoing benefits and changing lives along the way.
The whole of the Australian community benefits from improved financial literacy and a more self-sufficient – and better off, in the broadest sense – population.
Jane Nash is Group Head of Corporate Sustainability and Financial Inclusion at ANZ.
The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.
10 Feb 2015
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