Bruce Billson (Dunkley, Liberal Party, Shadow Minister for Small Business, Competition Policy and Consumer Affairs) Share this | Hansard source

As I was saying, the debate relates to the National Consumer Credit Protection Amendment (Home Loans and Credit Cards) Bill 2011. The bill is something that the opposition will not oppose. We see some merit in many aspects of the bill and we will be supporting its passage through the parliament. The bill essentially seeks to change the National Consumer Credit Protection Act 2009 to require licensed credit providers to do a number of things. These include providing to customers key facts sheets for standard home loans. These outline not only the scale of the loan but the quantum of payments and the overall costs of the home loan the consumer might be considering entering into. There are also to be key facts sheets for credit card contracts on a similar basis: the costs and responsibilities are outlined there so that consumers can make informed decisions.

The bill will also restrict unsolicited invitations to borrowers to increase the credit limit on their credit cards. This is an interesting measure within this bill. I am sure many of us in this House remember a time, when credit was abundantly available, when we could barely get through a week without having our credit card provider offering some Herculean increase in the credit limit, or even credit card providers with whom we had no association—perhaps they had sourced our names off some database somewhere—very generously offering credit cards with significant credit limits.

I can understand the temptation that those spontaneous offers of credit may represent for some people, particularly those facing some financial distress. You can see the connection between financial hardship and even in some cases the very viability of households when there is this revolving door of credit coming from multiple credit offers, unsolicited, from credit card providers.

The bill also seeks to prescribe rules for the use of credit cards above credit limits where there are transactions that peak out over what is euphemistically known as the 'maxed out' credit card, what occurs when those credit limits are exceeded and the arrangements to be entered into by agreement between the credit card holder and the credit provider. The bill also provides for an order of application of payments made under credit card contracts.

Essentially, these measures came out of some of the Labor Party's comments in the 2010 election. They related to a number of measures, including the regulation of issuance limits, fees and charges and product disclosure requirements of credit cards in order to enhance the protection of consumers. This was spurred on somewhat by a very important public policy comm­itment that the shadow Treasurer, Joe Hockey, made in outlining the coalition's nine-point banking plan. So persuasive were those nine points, despite the government's efforts to ridicule this forward-looking plan for our banking sector, that the Treasurer, Wayne Swan, quickly announced some of the measures that the coalition had outlined. So they clearly were not poor ideas, as Labor tried to outline. They were of such quality that the government tried to make them their own. Some of the measures in this bill carry forward the announcements in the nine-point banking plan of the coalition shadow Treasurer, Joe Hockey.

A couple of them are of particular interest to me, certainly the ones relating to price signalling. Interestingly, the government had never mentioned price signalling and a need to expand the powers available to the ACCC until the coalition started talking about it. In fact, the private member's bill that I introduced on behalf the coalition must have poked the government in the side to such a proportion that they quickly went about trying to create a bill of their own—a 'mine is bigger than yours' routine. I hope the parliament will consider before the week is out that the coalition's price-signalling bill is a product superior to the government's one and we will get the chance to debate that at some time.

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