Page 4940 - Week 15 - Thursday, 8 December 1994
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CONTINUE TO PROVIDE FINANCE TO PERSONS WHO OTHERWISE MAY NOT BE ABLE TO OBTAIN IT. I THEREFORE WISH TO MAKE ABUNDANTLY CLEAR THAT SUBCLAUSE 70 (2) SHOULD NOT BE READ OR UNDERSTOOD AS SOMEHOW INHIBITING TRADITIONAL LENDING PRACTICES OF TERRITORY HOUSING AGENCIES, OR BE IN ANY WAY INTERPRETED AS PREVENTING PEOPLE WHO ARE SUFFERING FROM INCOME SHORTFALLS BEING DEPRIVED OF THE BENEFIT OF SOCIALLY JUST AND INNOVATIVE HOUSING SCHEMES.
IMPORTANT INNOVATIONS IN THE CODE ARE THE PROVISIONS RELATING TO CONSUMER CREDIT INSURANCE. CONSUMER CREDIT INSURANCE HAS BEEN THE SUBJECT OF JUSTIFIED CRITICISM FOR SOME YEARS NOW AS BEING UNJUST WITH EXCESSIVE PREMIUMS IN RELATION TO PAY OUTS AND UNACCEPTABLY HIGH COMMISSIONS. THE PROBLEMS WITH THIS FORM OF INSURANCE WERE EXPOSED BY THE TRADE PRACTICES COMMISSION IN 1991 AND THE CODE, CONSEQUENTLY, GIVES SPECIFIC PROTECTION TO PERSONS WHO HAVE TAKEN OUT THIS FORM OF INSURANCE.
TO DEAL WITH THE EXCESSIVE COMMISSIONS THAT HAVE BEEN CHARGED IN THE PAST, THE CODE PROVIDES THAT A COMMISSION MUST NOT EXCEED 20 PER CENT OF THE PREMIUM AND, IN ADDITION, ON THE TERMINATION OF A CREDIT CONTRACT, ANY RELEVANT CONSUMER CREDIT INSURANCE CONTRACT FINANCED UNDER THE CONTRACT IS ALSO TERMINATED. THESE RIGHTS OVERRIDE ANY CONTRARY STATEMENT IN A CREDIT CONTRACT AND WILL ENSURE THAT SOME OF THE MOST BASIC AND TELLING CONSUMER DETRIMENT IN THIS AREA WILL BE RECTIFIED.
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