Page 4630 - Week 15 - Thursday, 21 November 1991
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The amendments contained in clauses 5 and 7 of the Bill will allow the tribunal, where the application involves a large number of contracts and it is impractical to give personal notice to each debtor, to deal with applications on a class basis. These new procedures will apply to the applications currently before the tribunal. Members may be aware of class action provisions in other overseas jurisdictions. This, in effect, is introducing that approach here.
The Bill also contains a number of related amendments to the Credit Act which will assist credit providers to comply with the Act. In particular, clause 6 will amend the civil penalty provision to provide that, where a credit provider applies to the tribunal to retain the right to collect credit charges after a breach of the Act, the credit provider may continue to collect credit charges till the application is determined. The credit provider may not, however, enforce or refinance the contract or impose default charges during this time. The tribunal may make orders to protect the interest of the borrower, if necessary.
In addition, the scope of the descriptive term "consumer credit insurance" is widened to include insurance against unemployment. This recognises the growing practice amongst credit providers of offering borrowers packages of credit risk insurance. The Act presently requires separate disclosure of unemployment insurance commissions. Incorporating the disclosure of commissions for unemployment insurance with insurance against death, accident, disability and sickness, which are already covered under the term "consumer credit insurance", will assist both credit providers and borrowers.
In closing, I note another small but important amendment. Clause 4 amends the provision relating to the setting of account charges. This amendment will bring ACT charges into line with those in the other uniform credit States. The maximum annual fixed fee that a credit provider may charge a debtor after the first year of the credit contract is raised from $75 to $90. In the future, such changes will be able to be effected by regulation rather than by amendment of the Act.
Mr Speaker, I commend the Bill to the Assembly, and I present the explanatory memorandum for the Bill.
Debate (on motion by Mr Collaery) adjourned.
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