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Legislative Assembly for the ACT: 2002 Week 10 Hansard (29 August) . . Page.. 3088 ..

MS TUCKER (continuing):

amendment may unintentionally narrow the definition of credit card, so have decided to play to it safe by leaving the definition as it is.

Clause negatived.

Clause 5 agreed to.

Clause 6.

MS TUCKER (6.04): I seek leave to move amendments 3 to 9 circulated in my name together.

Leave granted.

MS TUCKER: I move amendments 3 to 9 [see schedule 3 at page 3101]. I will explain the effect of each amendment.

Amendment 3 adjusts the title of the proposed new section 28A on a suggestion made by the government. The new title of this proposed section more clearly describes its effect. Although unsolicited credit increase offers are the target of this bill, the mechanism used is to formalise the acceptable steps to be taken when a credit provider offers a credit card contract or an increase in the credit limit under an existing credit card contract. Therefore the title "Credit card contracts and increases in credit limits" is more apt.

Amendments 4 and 5 tidy up the language in proposed new section 28A to make it clear that these new provisions apply to credit cards for personal or consumer use. The amendment achieves this by using the technical term "continuing credit contract" and specifying "for a credit card" instead of the less precise "credit contract" used in the bill as tabled.

Amendment 6 provides a more precise statement of a "satisfactory assessment process" and is based on a proposal currently before the Uniform Consumer Credit Code Management Committee and the Ministerial Council on Consumer Affairs. The proposal has been before the committee for some time, getting close to two years now.

Specifically, credit providers will be required to ask the debtor for a statement of the debtor's financial situation, including income or credit accounts and applicable limits and balances and repayment commitments, and to take the statement into account in making the assessment.

There was a suggestion in discussions that it would be useful to pick up another proposal currently before the ministerial committee to set a specific standard for ability to repay, but I decided not to go ahead with this amendment, as I believe it introduces a completely new requirement rather than reinforcing what is understood to be good practice. Therefore, it was of greater concern as going a step beyond the agreed national system. Also, and importantly, I could not be sure that it would not prevent people on low incomes who can in fact afford the credit from accessing credit.

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