A parliamentary committee has tied itself in knots, recommending enhanced protection for consumers using small amount credit contracts and consumer leases but also recommending that a bill that would deliver those outcomes not be passed.
The Senate Economics Legislation Committee has released its review of National Consumer Credit Protection Amendment (Small Amount Credit Contract and Consumer Lease Reforms) Bill 2019.
The bill has an unusual history. It was introduced as private member’s bill last December by Centre Alliance Senator Stirling Griff and co-sponsored by Labor Senator Jenny McAllister.
The bill is a “mirror” of a government bill introduced in 2017, which was a response to recommendations of the Independent Review of Small Amount Credit Contract Laws.
The independent review said there needed to be a tougher approach to SACCs and consumer leases.
After releasing the draft the government went cold on the reform, which most commentators say was a response to industry lobbying.
The Senate committee recommended that the government “continue to diligently progress sensible reform and strengthen regulation in the area of small amount credit contracts and consumer leases” but that the Senate not pass the bill.
It said: “It is important the government strikes the right balance between enhancing consumer protection, while ensuring these financial products and services can continue to fulfil an important role in the economy.”
A dissenting report prepared by Labor and Centre Alliance senators on the committee recommended that the bill be passed.
The push to get the government to act on the issue took another turn last week, when the South Australian government announced that it would introduce legislation designed to work in conjunction with the 2017 Commonwealth bill.