Page 1823 - Week 07 - Wednesday, 22 August 2007
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There is no doubt that the protection of consumers is of paramount importance. The Australian government has committed to doing everything within its power to ensure that consumers have the strongest possible consumer protection framework, but I believe that this is an issue for states and territories to resolve. I understand that in September last year the Ministerial Council on Consumer Affairs—which, as the attorney has indicated, the ACT sits on—agreed to take a uniform approach to the regulation of mortgage brokers, which would involve the imposition of licensing, conduct and disclosure requirements on brokers.
As has been mentioned already, the New South Wales government was tasked with preparing a draft bill, which I understand will be finalised at some stage this year in collaboration with the other states and territories. As recently as last week, the Australian government called on the states and territories to accelerate this work. I support these calls today and look forward to hearing in the near future a report on the progress of this new legislation from the government. It amazes me that with Labor in government in all states and territories this sort of uniform agreement has not been reached in a more timely manner. We have seen it in regard to the failure to reach agreement for the reciprocity scheme for senior cards. I hope that similar delays are not experienced in this field.
It is important for the ACT to be part of uniform legislation. Uniform national law is generally needed to avoid inefficiencies and injustice. However, there are occasions when such a position is not appropriate for the territory’s interest. The need for the ACT to be part of uniform legislation is exacerbated by the small size of our jurisdiction.
The cost of complying with legislation unique to the ACT may be prohibitively expensive for a number of non-bank lenders. Again I make the distinction here between non-bank lenders as a whole and the small percentage of predatory lenders. Non-bank lenders and brokers play an important role in the housing market in the ACT. If they cease operating in the ACT because of the cost of compliance with unique legislation, that could serve to reduce the availability of credit to ACT residents and, by extension, possibly increase costs. States and territories should progress uniform legislation as soon as possible.
Earlier, I mentioned Dr Foskey’s failure to consult with the Australian Bankers Association. It is worth mentioning the ABA because, although this motion points to the increase in non-bank lenders in the home loan market, the recommendation in the report cited by Dr Foskey would result in the same red tape being applied across the industry. Potentially, if non-bank lenders leave the jurisdiction, banks whose lending practices are not faulty would also be affected.
The recommendation that Dr Foskey would have applied points to section 28A of the ACT Fair Trading Act as a useful model of reform. Although I was not a member of the Assembly when that section of the act was passed, I understand that it came about as a result of a deal between the current government and the Greens. It also took the ACT beyond the bounds of otherwise uniform legislation across Australia. Then, as now, industry was not aware of what was going on.
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