Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 20 February 2024.)

Mr PEDERICK (Hammond) (16:07): I am just continuing my remarks from last night in relation to the Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill. I was giving a long discourse about the kilometres difference on my December 1989 red ute, which I still own.

As I indicated yesterday, the minister may explain to me during the conversation—or when we go into the committee stage—on disclosing the differences if, for instance, I was a second-hand dealer selling that vehicle. As I indicated, on the clock it shows only about 260,000 kilometres because it has been fitted with a different dash as some other components were not working—I think it was the temperature gauge from memory, but it was a long time ago. It is only 190,000 kilometres out.

Under clause 13 in the bill, where it talks about false or misleading statements in relation to this, I am unsure whether making a statement when you were selling it (or something like that) was enough instead of having to work out whether you could adjust the odometer to get it to the correct level, which may have to be done. It will just be interesting to see whether that is what has to happen.

In talking to some of my colleagues, a lot of us come off farms. There are a lot of vehicles on farms. Usually they are old trucks that are used for fire trucks that might have been your main truck 30 or 40 years ago—and no gauges work. Like our old International AB62, a 1960s-era build International. It carted a lot of grain for us; it was about a six-tonne payload legally. That did not have any gauges. I think I blew up the motor when we had a firefighting unit on it fighting a fire and she lost all her water one day. That was the end of that. But there would be many vehicles like that out in the private sector, and certainly if something like that was sold through a second-hand dealer it is something that would have to be remediated.

That is the interesting thing. There would be a lot of vehicles in circulation somewhere in the piece where there would be no idea of what they had actually done. For whatever reason, and it might not be anything nefarious, the odometer might have been disconnected or just no-one cared and they just drove it and it did not matter to them and they got on with it. So there certainly could be a range of vehicles in a range of situations where something like that could have happened where no-one for practical reasons more than anything wanted to repair it.

I know this is branching away from the fullness of the bill to a degree, but what stunned me during COVID was that I realised how many cars get traded across state borders, especially having a border with Victoria. I would have people contacting the office asking, 'What do we do?' I said, 'Whatever you do, wherever they say Victoria is, do not go there. Let the Victorians push the car across or whatever.' I think it is a credit to everyone at the border crossings, including the police and others, that there must have been hundreds, if not thousands over the time, of cars at various border points that were transferred. I know that is digressing a little bit from second-hand dealers, but it just proved to me how many vehicles get traded. There were several constituents.

I remember one constituent who rang me on a Friday afternoon about 4.50pm and said, 'I am trading a car at Bordertown.' I asked, 'When are you doing that?' They said, 'Tomorrow.' I said, 'Really? Do not go into whatever they deem is Victoria. Let them push it across. Ring me if it hits the fan, so to speak.' Anyway, I did not get a phone call, so it worked. I know that is digressing a bit from the intent of this bill because it deals predominantly with second-hand dealers. But it did intrigue me that even through COVID people were still keen to keep mobile and have opportunities to buy second-hand vehicles.

The intent of the bill is very good, especially in regard to increasing the penalties. Clause 4 is around the penalty for carrying out a business without a licence. I think is important that that penalty has increased by quite a lot. Also, the penalties for interfering with an odometer goes up to $150,000 from $10,000 per offence. As I said earlier in my contribution, I think that will assist in deterring people who may be in the industry and may want to turn those odometers back, or they have a bit of a chop shop set up out the back which is next level, I know, and it is not just odometers. Hopefully it deters people from doing that.

As I was indicating around clause 13 and prohibiting people making false or misleading statements, I note that there are some language changes in the bill to cover electric vehicles and also to remove obsolete references to 'facsimile'. I think it just says 'email' now, from memory.

I think this is very important, especially for people who on face value like to trust everyone, and sadly, in the world, you cannot. I have a couple of boys and they are very keen on vehicles, apart from driving my vehicles. Angus is only 19 and he is on his third vehicle. I have tried to slow him down a bit and said, 'You are an apprentice, mate. Just work for a while and let's get a really good car down the track.' But they always want that one that is a bit better.

The Hon. A. Michaels interjecting:

Mr PEDERICK: Well, exactly. Mack is working FIFO so he has a little bit of extra cash and, apart from this beautiful 1998 VS Statesman Series III, which is a beautiful car, he has a 2008 Audi S8 he bought from Canberra, a very nice little all-wheel drive car that really grips the road.

So I think this bill is for the kids and for those who take people at face value, and for the ones who are buying cars from dealers. As I have indicated, there are a lot of cars and vehicles that are traded privately and it is sort of at your own call. I know Mack was looking at some of these cars. I cannot remember the model now but he was looking at a second-hand BMW and he got it inspected. I am glad he did not end up with one because it might have ended up being a long time in the garage, but anything can.

This bill gives a little bit of solace to those people who are just trying to buy a genuine vehicle with genuine kilometres in the condition they can see it in, and if they get it inspected—even inspectors may not pick up if an odometer has been changed even a significant amount if it is spruced up enough. This bill will go a long way to getting some more honesty in the system for those who want to be nefarious. I note the industry supports this legislation so I support the bill.

Mr ODENWALDER (Elizabeth) (16:16): I rise today to also speak on the Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill 2023. For many people, purchasing a car can be the biggest financial purchase they might make after the family home. We know there are many different reasons and motivations for buying a car. For young people, it can be a source of independence and a way to get to work. For enthusiasts, like the member for Hammond's son, buying a certain car can be a life goal. For tradies, it is a vehicle that will reliably carry their tools and equipment from one job to the next. For a young family it can be the car that will transfer and protect them for many years.

While public transport is largely available and reliable in Elizabeth, sometimes a car offers a more practical and direct way to get to a destination. School drop-offs become a lot easier with a car, getting kids to sport on the weekends can become more practical. This is especially so if they are playing a long distance away. A car can also be the most convenient form of transportation to and from important medical appointments. Close to my electorate office on Elizabeth Way and elsewhere in Elizabeth, there are several second-hand car dealers and many cars are purchased on the second-hand market.

These second-hand dealers offer families and individuals an opportunity to get a car sooner compared with a brand new vehicle, and we know that at the moment very long waiting periods for new vehicles are not unheard of. There are also, of course, many private sales of vehicles. It is not uncommon to drive through Elizabeth and see cars parked with 'for sale' signs on them. Elizabeth, of course, has always had a particular love of cars, being the home of Holden for many years, and my own first car was bought second-hand, a Holden LJ Torana, that at the time was the most ridiculous $250 I ever spent but now I wish I had hung onto it for much, much longer.

Mr Pederick: What size motor?

Mr ODENWALDER: I don't know. Member for Hammond, it was a factory standard two-door LJ Torana.

Mr Pederick interjecting:

The ACTING SPEAKER (Mr Brown): Order!

Mr ODENWALDER: I will make some comments later about the complexity of modern cars. The complexity of 1976-built cars is beyond me. With the cost of brand new cars, many people look at the licensed second-hand market for a more affordable alternative. In particular, second-hand dealers offer protections to the buyer that are not available from a private seller. Many people work very hard to be able to afford a private vehicle. For young people it can be many years of saving and working extra shifts at their jobs. Families will put their hard-earned money aside. It can be heartbreaking and financially disastrous if this purchase turns out to be not what was promised.

When looking at a second-hand car to buy there are many factors to consider: the age of the vehicle, the number of owners, the service history and the kilometres on the car. These factors help consumers determine whether the price being asked by a second-hand dealer is fair. The kilometres that the car has travelled can be one of the most important things to consider when purchasing a used car, and generally cars with lower kilometres are more valuable. Therefore, second-hand dealers who tamper with a car's odometer can then sell that car for a significantly higher price. The fine for tampering with an odometer can be less sometimes than the money gained by winding it back. Sadly, instances of odometers being tampered with are not uncommon, with CBS finding the deceptive practice on the rise.

Winding back odometers can also result in important maintenance and safety work not being carried out on the car, potentially resulting in serious issues. With heavy traffic, such as that along Main North Road where it is 80 kilometres for long stretches, ensuring people are in safe, reliable cars is paramount. If a critical component within an engine fails as someone is pulling onto a main road, the consequences could be catastrophic.

As I have already observed today, cars are somewhat more complex than my old LJ Torana, and the cost of repairing a modern car that has not been maintained can be enormous. If a critical part fails due to no maintenance being performed, the cost of repairs can be more than what the car is worth. The car may also be unsafe to drive.

Then there is a consequence of not having a car while waiting for repairs. Depending on the make and model, some parts can take a long time to be sourced and this can make it challenging for people to get to work or for kids to be dropped off at school or sports on the weekends. This situation can be not only financially stressful for families and individuals but emotionally stressful too.

In Elizabeth, as in many other areas, it is a common sight to see tradies in utes and vans. For a tradesperson, a vehicle out of action represents a lost income. It can also mean lost customers through no fault of their own. For many smaller businesses, this is something that is not easily recovered from. This odometer tampering practice not only impacts on the initial buyer of the tampered vehicle but can also impact future owners of that vehicle. These owners can also be unaware that it may have missed out on important maintenance and safety checks.

It is no secret that older, less expensive cars are often bought by young drivers as a first car. Again, in Elizabeth you will quite often see older cars being driven by young provisional drivers. With young provisional licence holders already being at higher risk of serious accidents, odometer tampering can put them at further risk.

This is why we—and I understand the opposition agrees—believe it is time to increase the maximum fine for odometer tampering from just $10,000 to $150,000 for a first offence. Subsequent offences can then be penalised, with fines going up to $250,000 or up to two years' imprisonment. These fines can also be brought against an individual, not just a car dealer.

Previously, compensation could be sought against a second-hand dealer who was found guilty of tampering with an odometer; however, no compensation could be sought against private sellers. I am glad to support these amendments that allow compensation to be sought from private sellers who are convicted of tampering with an odometer.

Odometer tampering and unlicensed dealing are not the only things these amendments will address. Last year in Australia, over 100 new hybrid cars were sold. Many people buy hybrid or electric vehicles to cut down on the money they spend on fuel and to reduce their carbon footprint. As hybrid cars become more popular, the number that will come up for sale on the second-hand market will also increase. With the cost of fuel, hybrid cars can present a way to reduce costs, particularly for those who must travel long distances.

Previously, there was little to no provision to protect consumers who bought a second-hand hybrid or electric vehicle with a defective propulsion battery. The propulsion battery is a critical component in a hybrid vehicle. Replacing the main battery on a hybrid or electric vehicle can cost tens of thousands of dollars. This, of course, for anyone, could be a financial disaster. This bill will expand the duty to repair to cover the main propulsion battery for hybrid and electric vehicles.

This bill also supports second-hand car dealerships by removing the requirement to display the name and address of the previous owner. This also applies to a car that was previously used as a hire car or a taxi. The requirement to display these details can be misleading as dealers do not always receive accurate information about the previous owners of a vehicle. Dealers simply now must provide a statement that these details are available on request.

This helps protect the privacy of someone who has sold a vehicle to a second-hand dealer. These changes will also apply to vehicles sold at auction, another popular way to save money on second-hand vehicles. This bill will also allow second-hand dealers to list defects on a vehicle that will not be covered by the duty to repair. This will help provide transparency to consumers and help them make an informed decision.

Additionally, this bill will also give consumers the ability to waive a cooling-off period when purchasing a new vehicle. Currently, consumers must wait two business days to consider the purchase of a second-hand vehicle. If they wish to waive this right currently, a separate form must be completed, signed, witnessed and then submitted to the dealer. This bill will remove the requirement for someone to witness the document, streamlining the process for both the consumer and second-hand dealers. This will help those who need a vehicle sooner rather than later. With a number of second-hand dealers located in my own electorate in Elizabeth, some located almost right next door to my electorate office, I am happy to support this amendment.

This bill is an important step in deterring dishonest second-hand dealers and supporting consumers and second-hand dealers who do the right thing. It provides for strong deterrents against those who do the wrong thing, as well as real benefits to second-hand dealers and, particularly, to consumers. I commend the bill.

Ms CLANCY (Elder) (16:24): I rise today in support of the Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill 2023. This bill seeks to amend the Second-hand Vehicle Dealers Act 1995 to improve the process for dealers selling second-hand vehicles, whilst strengthening protections for South Australian consumers. This reform will bring us in line with other jurisdictions and Australian Consumer Law.

Many South Australians choose to purchase a second-hand vehicle from a licensed dealer rather than a private seller to ensure that they have greater consumer protections and applicable warranties in place. The bill before us today aims to strengthen the Second-hand Vehicle Dealers Act 1995 and ensure that it continues to serve its purpose of maintaining the integrity of the second-hand motor vehicle industry and provide strong consumer protections. It is important that we review this legislation now, to ensure it aligns with Australian Consumer Law and accounts for the significant changes to vehicle technology that have occurred in the last few years.

A number of concerning practices within the second-hand vehicle industry have been brought to our government's attention, including licensed dealers avoiding their legal obligations to provide statutory warranties and relevant and necessary disclosures about the state of vehicles by posing as private sellers, the sale of cars with false papers, and the winding back of odometers to misrepresent the kilometres the car has travelled. Such practices often leave families who are already struggling with cost-of-living pressures with more costs to contend with, which is why our government is today putting measures in place that help prevent South Australians from being taken advantage of.

I am currently supporting a family in my community who purchased their family car second-hand from a licensed dealership. Since its purchase, the vehicle has had to be returned to the dealership's mechanic on an ongoing basis for an issue that my constituents were not advised of prior to its purchase. After seeking their own independent mechanical advice, my constituents have been advised that their family vehicle is not roadworthy, due to damages sustained prior to the vehicle being purchased.

As I support this family with their complaint to Consumer and Business Services, and as I stand before you today, I am reminded of the importance of reforms such as the bill before us. While we know that most South Australian businesses will always do the right thing for their workers and consumers, we must not neglect our responsibility to ensure adequate protections are in place against those businesses that do not do the right thing.

This bill seeks to implement a raft of changes to support the interests of dealers and consumers, including ensuring that consumers have a better understanding of vehicle defects prior to purchase. With some exceptions, dealers have a duty to repair a defect that is present in a vehicle or appears in a vehicle after it is sold. The successful passage of this bill will permit dealers to disclose defects in a vehicle that would not be subject to the duty to repair, provided that the vehicle remains safe to drive. Both the dealer and the purchaser will need to sign a prescribed form acknowledging the defects. This amendment will bring South Australia in line with other jurisdictions and consumer guarantees in Australian Consumer Law.

One of the most sought-after reforms included in this bill brought to us by the minister is to substantially increase penalties for odometer tampering. While I am sure many of us thought that the attempt in Ferris Bueller's Day Off to tamper with the odometer of Cameron's dad's 1961 Ferrari 250 GT California Spyder—so that his dad would not know that they had taken the car out all day and had a great old time—was very funny, it is not funny at all in real life. Odometer tampering is a serious issue that can have significant consequences affecting the mechanical effectiveness and safety of a vehicle.

This bill seeks to increase the penalty for odometer tampering from $10,000 to $150,000 for first and second offences, and $150,000 and/or two years' imprisonment for third and subsequent offences. These penalties will be the toughest in the nation for this offence. This reform will also provide for a compensation scheme for victims of odometer tampering for vehicle purchases from private sellers. Under the current act, victims of odometer tampering can only seek compensation where a dealer has been previously convicted of a tampering offence. There is no provision for compensation for victims of odometer tampering where the car has been purchased through a private seller.

Additionally, a new offence will be created for dealers providing false and misleading statements about the accuracy of odometer readings. Where a person knowingly makes a false or misleading statement to a purchaser, a maximum penalty of $30,000 or two years' imprisonment will apply. Currently, only dealers can be prosecuted for providing false and misleading statements under Australian Consumer Law. This new offence is intended to deter private sellers from engaging in the same activity.

This bill also seeks to introduce new powers for the Commissioner for Consumer and Business Affairs, allowing them to direct a person to rectify an altered odometer or to refrain from selling a vehicle with an altered odometer unless they have been provided with written approval by the commissioner. This will assist in ensuring that vehicles with altered odometers are not on South Australian roads.

Penalties for unlicensed dealing will also be increased under the bill. For first or second offences, the penalty will increase from $100,000 to $150,000. For third or subsequent offences, the penalty will increase from $100,000 or 12 months' imprisonment or both to $250,000 and/or two years' imprisonment. It is hoped that by increasing these penalties more individuals will be deterred from defying the law.

Dealers currently have a duty to repair a defect that is present in a vehicle or appears in the vehicle after it is sold. There are exceptions to this requirement, including vehicles that are over 15 years old or have more than 200,000 kilometres on their odometer before the sale.

To further protect consumers, amendments to section 33 of the act will remove the ability of purchasers to waive the right to have a vehicle repaired under the duty to repair. This amendment again will bring South Australia in line with Australian Consumer Law requirements that purchased goods must be of an acceptable quality and fit for purpose.

While the increasing prevalence of electric and hybrid vehicles on our roads is very apparent, this bill creates provision for the duty to repair requirements to be expanded to cover the main propulsion battery for these vehicles within the statutory warranty period. This duty will apply to vehicles purchased before or after commencement of the amendment act.

The Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill 2023 will introduce a number of other amendments intended to appropriately and necessarily update the act, including ensuring privacy protections for previous owners and lessees, updates to administrative requirements to create efficiencies and reflect more modern practices and expanding the Second-hand Vehicles Compensation Fund so that the fund can be used for education, research and reform programs.

In closing, I would like to thank the Minister for Consumer and Business Affairs and her team for their work in bringing this bill to this place. I would also like to acknowledge the work of key industry groups, including the Motor Trade Association and the RAA, thank them for their participation in consultation processes related to this bill and for their strong support for the proposed amendments. I commend this bill to the house.

Mr COWDREY (Colton) (16:32): I rise today as others from both sides of the chamber are doing to support the Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill 2023. At the outset, it is appropriate to acknowledge the input of the Motor Trade Association of South Australia, their policy team and, more broadly, in bringing the issues they have identified in regard to the onselling of second-hand vehicles in South Australia. I also acknowledge their constant work to ensure all parts of the motor trade industry have an appropriate level of respect.

Whether it be around second-hand vehicles or the crash repair industry or more generally, the view of the MTA is they want to ensure that what should be done is done within the industry, that there are acceptable and practical standards that those who participate in the industry should be meeting, and that there are appropriate guidelines in place to ensure that we continue to keep the industry well respected and in a good place.

As has been said by previous speakers, the substantive part of this bill essentially is looking at modernising the legislation to bring what is a piece of legislation that has not been touched for quite some time into the modern day. No greater illustration of that is the changes to limit the use of fax communication—something that not many use these days—in regard to dealing with the cooling-off period. We are dealing with the modernisation of both language and communication in this bill, as well as obviously making some significant changes to how second-hand vehicles are dealt with through the onselling process.

The substantive part of the bill, as I have said, is largely around ensuring a number of things. Firstly, safety is paramount. Obviously, it goes without saying and has already been said during the course of this debate that the purchase of a motor vehicle is usually one of the most significant purchases that people make in their life, outside of their house. It is usually the second largest asset that many people have in their possession. The desire for there to be some rigour and to have, as best we possibly can, an industry that provides what they say they are going to provide is obviously essential to ensuring that there is confidence when making such a significant purchase.

I think the MTA has rightly drawn our attention to consumer rights around a number of aspects of their industry over the last number of years—a minimum expectation of what a purchaser can expect from somebody who is selling them a second-hand vehicle. There is a real deterrent for those people who are dishonest and operating within the industry. It goes without saying that a number of the penalties that are in line with the provisions through this act will be significant. They will be harsher than other jurisdictions, but in the context of what is before us today, it has been deemed by both sides of this house that that level of penalty is appropriate given the circumstances and the seriousness of the offences that we are discussing today and, lastly, the integrity of the second-hand dealer industry in the state.

I must say at the outset that I am not much of a car person. It is not something that I know all that well. I use a vehicle to go from point A to point B. What it looks like is not something that greatly excites me in any way, to be completely honest, and never has. I think just about everyone in the chamber to this point has disclosed their first car, so I may as well join and let the inevitable bits and pieces that come from that happen.

It was a 1990 Toyota Camry. I still have the difficulty of pointing out what the difference between the Toyota Camry and the Holden Apollo of that time was. I believe they were basically the same car just with different badges on the front. If there is anybody who can enlighten me as to what the difference between the two versions of those cars was, please do. I was very lucky: it was a very good car. Certainly, there were no issues that I encountered with that car right the way through. As I say, I count myself as a lucky one, who was not in a position of ever needing to deal with some of the issues that we are dealing with today within the legislation.

Mr Teague: You should have had a golden Holden.

Mr COWDREY: I think that was one of the key things that was passed on to me: the reliability of that choice of car. In regard to the specifics of the bill, I will get to those in a minute, but I think it is timely to also reflect on the good work that has been done over previous years within this space or more broadly.

One of the very first parliamentary inquiries that I undertook on the Economic and Finance Committee was in regard to the crash repair industry in South Australia. Through the collection of submissions, and having witnesses come in and provide evidence to the committee, the one thing that really stuck with me from that particular inquiry was the frustration that came from the many people within the industry who were doing the right thing towards those who were either participating at the periphery or were blatantly doing the wrong thing. It was clear through the evidence that they gave that there really was this frustration with how the industry was viewed as a whole because of the behaviour of a few bad eggs.

Really, that particular thought process and that particular view is what we are trying to achieve today: to weed out as best we can the bad eggs within the industry of second-hand vehicle dealers to ensure that we are deterring as best as we possibly can those who do not want to do the right thing within the industry from participating.

As has been stepped through, there are a number of substantive changes that are being made. In regard to the declaration of defects that will not be subject to the duty to repair, that particular section and those changes to section 23A, as has already been said, will bring South Australia in line with the consumer guarantees that are set out within the Australian Consumer Law. There are changes around the regime to waive duty to repair rights and the particular documentation that is required in regard to the cooling off period and those rights, in particular around the document that is used through that process: simple changes and modernisation changes to limit the red tape to some degree by removing the requirement for a witness to sign that document.

One of the key penalty provisions that is being changed is in regard to odometer tampering. While this is, I assume, easier in older cars where there is an odometer that is not digital, the reason nonetheless is still the same: we have a car that potentially has done significantly more kilometres on the road that is in a condition that is different from what would be anticipated for a car that has done what is reflected in terms of the odometer reading for that car. So shifting those fines will result in a significant increase, from $10,000 to $150,000 for the first and second offence, and then the potential for imprisonment for any subsequent offences goes to the seriousness of that particular offence and that particular action in terms of tampering with odometers.

There are a range of other changes in this legislation around odometers as well, and odometer readings, including changes being made to false and misleading statements about odometer readings. As has been addressed by other members through their contributions to this point, a compensation fund is being set up under the act to compensate those who have been subject to odometer tampering. Powers will also be provided to the Commissioner for Consumer and Business Services to do as best he can to ensure that those vehicles that have had their odometer tampered with are not onsold or removed from sale, and to either direct somebody to rectify an odometer reading or to ensure, as I just said, that the selling of that vehicle cannot be done until the vehicle's odometer is rectified.

Similarly, in regard to modernisation of the act, given the shift in the vehicle market to include now electric and hybrid vehicles there has obviously been a need to bring that technology within the legislation, to be covered appropriately by the legislation so that the main propulsion battery and the other bits and pieces that are involved with hybrid and electric cars that are covered by the statutory warranty period are also covered as part of this rewrite to the act.

Further changes of less substantive form include changes to the prescribed forms around contracts for sale and exactly what needs to be included in those contracts. That has been a sensible shift, to have across-industry form contracts for the sale of second-hand motor vehicles. Again, I thank the government and the minister for bringing this bill to the house. I thank the MTA again for their work in bringing the particular issues addressed by this piece of legislation both to the government and to the opposition, and for bringing them in a way where they have provided avenues to improve the existing legislation that we have in place.

I think this bill will hopefully do its work as has been envisioned, to ensure that we do weed those bad eggs out of this industry, that we continue to have a respected second-hand dealers market and industry in South Australia, and that we have legislation today that rightfully is focused first and foremost on safety. We know that we lost too many lives on our roads last year. We certainly hope that there is a decrease in that this year.

The very last thing we need is vehicles going out onto our roads that are not roadworthy, that have not had the appropriate repairs made necessary to make them roadworthy before we have people—particularly young people, who are generally in most circumstances buying second-hand cars (I certainly was one of them) when making their first purchase—out on the road in cars that are not at an appropriate level.

It is about consumer rights. It is about minimum expectations. It is about deterring dishonest dealers, and it is about ensuring the integrity of the second-hand dealer industry in South Australia. With those words, I again thank the minister and look forward to the passage of this bill and to improving those particular aspects and the second-hand vehicle dealer market in South Australia through the passage of this legislation.

The Hon. K.A. HILDYARD (Reynell—Minister for Child Protection, Minister for Women and the Prevention of Domestic and Family Violence, Minister for Recreation, Sport and Racing) (16:48): I too rise today in support of the Second-hand Vehicle Dealers (Miscellaneous) Amendment Bill 2023, a bill which, as we have heard, is all about ensuring our state has some of the strongest penalties in the nation to help crack down on dodgy used-car sellers.

The purchase of a car is a significant investment and can be really exciting and quite an experience, as can the years and months after making that purchase. I remember very well my first and my beloved second car. My first was an old cream Corolla wagon with a brown roof and brown two-tone stripe. It was $800 from a local dealer, and when I bought it I felt like I was more independent. I felt like I could safely get around. I felt like the days of finding all sorts of creative ways to travel were done. I felt like I could rely on it to safely get me to and from work and home. I was really glad not to have to rely on other people or a late-night bus.

Things went okay with the two-tone brown and cream Toyota Corolla, briefly. For a short while I felt excellent. I was free and I was freewheeling around the streets, generally with a gang of loud and excellent young women packed into the back seat. But then came a Christmas Day in the 1990s.

My mum was hosting lunch at Boomer Beach. My elder sister and I were living in a share house and we packed up our stuff to head down for Christmas Day and the few days following. We had a mountain of clothes, boogie boards, wetsuits and quite a few refreshments packed into the back. Things were going really well until we got to the base of Willunga Hill. That little cream and brown two-tone wagon tried and tried, but just got slower and slower as it made its way up the hill. The temperature gauge reached the highest it could go, steam came out of the bonnet, and we just stopped at the steepest point of that hill.

Bizarrely, on stopping, the boot simultaneously flew open and all of our stuff—bathers, clothes, refreshments, boards, everything—fell onto the Victor Harbor Road. Christmas lunch-goers heading at 100 km/h to the coast had our clothes whip onto their front windscreens, and we dodged traffic to try to collect cosmetics smashed onto the bitumen. That was car one.

Mr Pederick: Was that its death knell?

The Hon. K.A. HILDYARD: Yes, pretty much; things went even further downhill after that. The second was my absolutely beloved HG Holden, a much better experience—also, however, strangely cream and brown two-tone. I loved that car. There was something about the column shift gears that made me feel like I could do anything. To this day, it was the most solid car I have ever travelled in. I repeatedly (I mean, repeatedly) took out the gate to our driveway in it and had a range of mishaps, but it always came off literally without a scratch on it. It felt and behaved like a tank. To this day I wish that it was still in the driveway, gate or no gate.

When I purchased my car and when I witnessed my kids purchase their first cars, I wanted reassurance that the car was safe and reliable and that I and they had good information about its condition. As someone with literally no mechanical expertise and not a lot of patience, I just wanted my car to get me where I needed to go without drama—and certainly without a scene on Willunga Hill.

For my kids, with whom we went through some really interesting times when they learned to drive, I just wanted them to be as safe as possible and to never be stranded in a difficult situation. I literally heard their first cars come up the street before I saw their first cars. I remember one of our sons, on the day that he proudly went and got his Ls, asking my husband if he could drive some of the way home. He was allowed to, and my husband was in the passenger seat. When our son asked a question about where to go, my husband very, very wrongly said, 'Just go straight through the roundabout.' So he did, literally, just go straight through the roundabout—straight over the roundabout.

Most dealers do the right thing. They give people the information they need, and they provide reassurance about any repairs that are needed and any attention to safety that is required. Unfortunately, Consumer and Business Services have seen emerging and growing trends of concerning behaviour, including tampering with odometers and unlicensed selling. These behaviours directly aim to take advantage of people—those first-car buyers we have all described—and to increase profits.

The reforms in this bill mean that for the first time anyone caught winding back an odometer will face jail time or a fine of up to $150,000, along with longer sentences and higher fines for unlicensed dealing. This increase in penalties will rightly act as a deterrent to help safeguard people's rights and to promote transparency.

We want to ensure that every individual, and indeed every person's loved one, who steps into a car yard and goes about making that first purchase can do so with confidence knowing they will receive honest information and fair treatment. As well as increasing penalties, this bill also modernises the Second-hand Vehicle Dealers Act 1995, which has not been reviewed since 2009. Since 2009, there have been significant advancements in technology and changes to methods of how cars are assessed and repaired.

As mentioned earlier, one of the significant amendments to the act is the increased penalties for tampering with odometers, again seeing the increase in the maximum penalty increasing from $10,000 to $150,000 for the first and second offence, and for third or subsequent offences seeing a maximum penalty of $150,000 and/or imprisonment for two years. As has been mentioned by other speakers, this sees us progressing the strongest penalties in the nation on this offence and helping to prevent dealers making profit from doing the wrong thing.

As a result of odometer tampering, currently victims of convicted dealers can obtain compensation. However, there is no provision for this to occur in the circumstance of a private seller. Changes to the act through this bill will see courts now having the ability to order compensation for a person who purchased a vehicle with a tampered odometer from a private seller who has been convicted. This compensation is really important both to remedy the costs incurred, or likely to be incurred, and in order to rectify the odometer on the vehicle.

The other significant increase to penalties is to unlicensed dealing. This penalty increases from $100,000 to $150,000 for first and second offences, and to $250,000 or two years' imprisonment for third and subsequent offences.

Another amendment will allow second-hand vehicle dealers to disclose defects which will not be subject to the duty to repair provided that the vehicle remains roadworthy. The current act details the provisions for the duty dealers have to repair a defect that arises during or after the sale of a vehicle. There are a number of exemptions to this requirement, including vehicles that are over 15 years old or have been driven more than 200,000 kilometres before the sale. This amendment brings South Australia up to date with similar arrangements in other jurisdictions and aligns with consumer guarantees in the Australian Consumer Law.

In another move to align our legislation with those Australian Consumer Law requirements and to add protection, the bill also rightly removes current provisions that allow a purchaser to waive their general right to have a vehicle repaired by the dealer under duty to repair obligations. As said, this approach is consistent with Australian Consumer Law requirements that purchased goods must be of acceptable quality and fit for purpose.

There are other amendments to speak to and which others have, but finally I make mention of the amendments to the Second-hand Vehicles Compensation Fund. Whilst currently the main functions of this fund are to compensate consumers when there is no reasonable way of recovering the money they are owed by a dealer, this bill will expand so that this fund can also be used for education, research or reform programs that benefit dealers, auctioneers, salespeople or the general public. It is really important to ensure that all involved in the process of buying or selling a vehicle are aware of their rights, their responsibilities and the help that is available to them. Community awareness and education are crucial to that effort.

In closing, I wholeheartedly commend the work of the Minister for Consumer and Business Affairs and her staff and officials for all of their really important work on this bill. As the Minister for Consumer and Business Affairs also did, I do remind everybody when buying a vehicle to exercise a great deal of caution. This might include getting the car inspected, checking that the odometer reading is consistent with the wear and tear on the vehicle, and visiting the Personal Property Securities Register to check that the car has not been stolen, flood damaged or written off. If somebody does have any concerns, I really encourage them to contact Consumer and Business Services for advice and support. I commend this bill to the house.

The Hon. D.G. PISONI (Unley) (17:00): I have been enjoying the stories of people's first cars, so I was impatiently working my brain, starting back at 1980, when my first car happened. It was actually my father's Holden Premier. It was gold in colour and he bought it new. He got his driver's licence quite late in life. His first car was a second-hand Zephyr that he bought from an Italian mate of his, and then in 1970, as a GMH worker in the tool room at Holden's, he got the staff discount and bought a brand-new Holden Premier. There were four boys, three of us quite close together then a younger brother who used to sit in the bassinet at the back without even a seatbelt. That was how it happened in those days. The bench seat at the front would have mum, dad and one of the boys and then the bassinet and two boys in the back.

Anyway, 10 or 12 years later, my father decided he was going to get a new red diesel Gemini and he was looking for a buyer for his car and I decided to do that. So that was the first car. Then my boss, when I was doing my apprenticeship, decided he was going to sell a Ford Cortina that was a company car, and he offered it at a price that was hard to resist so I then sold my Holden Premier, which by that time had extractors and chromies put on it. Do not forget I grew up in Salisbury. So I took the chromies off and sold them separately because in those days a set of chromies would cost you about three weeks' wages. It was a lot of money for a set of chromies, so I sold those separately and put the original wheels back on.

But not long after I had the Ford Cortina, I started my own business and I was distracted one day and the Cortina was T-boned. I then decided that I needed to be able to move furniture around so I traded it in for a one-tonne ute that I used to use for work, and also when I was picking up my dates, I used to turn up with the one-tonne ute. I would always open the door, of course, when driving. Then the business was going quite well and I decided to purchase a second-hand BMW. It was about 10 or 12 years old but it was the current shape and that was the pitch from the salesperson. Unfortunately for the dealer but fortunately for me, during the warranty period the gearbox shat itself but they had to fix it.

I then sold that privately to a young mum who was looking for a second car and I used the money as a deposit on my first bit of real estate, but that meant I needed to purchase a vehicle for the business to get the furniture around. At a car yard, we found a 1950s or 1960s ute with a timber tray on the back. We were in the furniture business and so quite attracted to the timber tray. It had an on-the-column manual shift, and the bonnet was even that heart shape with the separate wheel guards over it. It was quite an experience to be driving that around, delivering furniture.

That was then upgraded with a third-hand bread van for delivering of furniture. After that, we bought a Mitsubishi Express, and in between times I had for my own vehicle a Chrysler ute with the handmade three on the floor. Do you remember those? We used to drill a hole in the floor, take off the rods, if you like, that connected the gearstick to the steering wheel, stick a hole in the floor and stick on your custom-made lever, if you like, with a polished knob. Normally, it had a spider in epoxy resin on the top of it—I do not know if you remember those—that you would use for three-speed.

Then, the Mitsubishi Express replaced that, and finally, after being married for about nine years, we bought our first new car, which was the Mitsubishi Magna. So, as you can see, it is part of the evolution of life, buying and selling cars, and I am sure that my experience is not a lot different to so many other South Australians, but it is always a risk, of course, when you are buying from someone who is not a dealer.

I have to say, I have only had pleasant experiences with dealers. I do not know whether that is because I was only using dealers who were members of the MTA but warranties were always honoured, which is very good to know, particularly when you like driving cars but you do not necessarily like looking under the bonnet or talking about the engine or having to get something fixed, having the ability to have that purchase.

These days, with social media, everybody wheels and deals in everything. You have carsales, you have Gumtree, you have Facebook Marketplace, all of these places where people are selling cars. I think there is no doubt that it has led to an increase in what we would call unlicensed dealing where people are selling more than what you are allowed to sell by someone who is considered not to be in the business of selling cars, because if they are they need to be licensed in order to do that. That is obviously to protect consumers and also to ensure that cars that are being sold are safe and roadworthy.

I think increasing those penalties is a very good piece of legislation to match with the times. The fact is that things have changed enormously. Many people run side hustles on social media, whether it be dealing in vintage clothes, mid-century furniture and objects, antiques or toys—you name it, you can find it on any of those social media sites. It is very obvious that people are selling multiple items, and we know that happens with cars.

People might be selling car components or they might be selling full cars. They have an interest in doing it and they have worked out they can make some money by doing it. By having higher fines for odometer tampering, and also by enabling someone who purchases from a private seller to be able to seek compensation for the inconvenience, for the damage or the overprice they may have paid for that vehicle, because somebody who sold them that car as a private person has mucked around with the odometer, not only will there be a fine but there will also be financial recompense for the purchaser. That is a good inclusion in these changes.

From my very early time as someone who looked at cars for purchasing, I could never work out who the previous owner was. That information was so obvious. We can see how that is possibly quite a big problem in this day and age, when people are so easily found on social media and when there is identity theft. From what I can recall from memory, a plastic sleeve would be hung inside the window on the driver's side and there would be the name, address and even a phone number there for anybody who was even just visiting a car yard after hours to see that information.

Now, by having that information being requested, there is a trail of who has that information, so if that information is used inappropriately there is some chance now of catching the person who is using that information inappropriately—as opposed to the free-for-all that we currently have, where that information is public for all to see, even if you do not have an interest in that car and you have some nefarious use for that information, and you are simply gathering that information for personal gain in some illegal activity or some other activity.

We know that with someone else's identity, if you have someone's address or phone number, that is the start of finding out more about them through social media or Google searches. There is not much that people do in their lives these days that cannot be found on social media, which could help build a profile that would enable somebody to use all that information and put it all together.

I am sure that with new tools that are being developed every day through AI, even the missing gaps now could be put together using AI to turn that information into a person for the purposes of opening up a credit card account, borrowing money from an institution or even stealing a car by taking a car on a test drive with a driver's licence that has been obtained through fraudulent means and not returning it to the car yard or the driver. I think that is long overdue and has caught up with the modern age.

It would be interesting to know whether it may also be an extra precaution for a reason to be given for wanting that detail from the dealer about who previously owned the vehicle just to ensure that all that detail is only given to people who provide their own contact details and have proof that they are the people they say they are who are requesting this information. I am not sure whether the bill covers that. Perhaps I will ask that question during the committee stage because I think it is probably important to do that.

I do not think this is too big an additional burden on dealers or on those selling cars privately. My very first car was a massive investment. You have to put it into perspective. With the price of getting into the real estate market, for many people a car may very well be the largest purchase they make in their life, so we need to ensure those who are selling those vehicles, whether they be dealers or members of the public selling a car privately, which they are perfectly entitled to do, are not misleading people.

It is very hard to mislead somebody on the age of a vehicle but tampering with the odometer is certainly a way of misleading people about the longevity that they are purchasing with that vehicle. Obviously, the lower the kilometres the more longevity you would expect to get out of the car. If you have purchased a car that tells you there are only 60,000 or 70,000 kilometres on the clock but there are really 270,000 kilometres on the clock and you have paid the premium for those lower kilometres, because someone has tampered with the odometer then obviously there need to be serious consequences for the person who has done that or anyone who has participated in that scheme and then an ability for compensation for the purchaser regardless of where the purchase was made.

It is nice to see the tidy up at the end relating to fax communication. I wonder if anyone knows what that is these days—fax communication. Although I did find out that it is only in the last 12 to 18 months that communication between doctors and pharmacists was allowed to be other than by fax—this is written communication. The dying fax industry was being supported by the pharmaceutical industry in Australia. Now they are allowed to send emails to each other to correct a prescription that may have been mistyped or mis-dosed or alternatively the wrong drug prescribed, rather than it being corrected and then the paper correction being sent through by fax machine followed by the original prescription the next day or later in the day. It can now be done through electronic means. Even pharmacists now will not have the ability to use a fax machine if they sell their car or buy a car. I am sure they will be very keen to see those leave the office.

With those remarks, I will conclude with the support of these changes in the bill and certainly hope that that will increase the confidence people have when they are buying a used car and will also perhaps weed out some of the shonks who are out there. I think it was John H. Ellers who had an ad: 'John H. Ellers is your man. Quality proven cars is his game. He is the leader of the car buyers. John H. Ellers is his name.' He had production line reconditioning on his used cars and he demonstrated what he thought the opposition was doing in reconditioning their cars, where you saw people putting bananas in the diff. With this legislation, perhaps we will see fewer people who grease their diffs with bananas before they put them on the market.

The Hon. A. PICCOLO (Light) (17:19): I rise in support of this bill, the Second­hand Vehicle Dealers (Miscellaneous) Amendment Bill 2023. As I am sure is the case with a lot of other MPs, the two areas of complaints I get in my office in terms of consumer products are shonky workmanship in houses, etc., and cars. Generally speaking, I have young people come and see me about the car they purchased, which turned out to be a bit of a lemon. Some dealers are quite good at making sure the contracts are written in a way that deprives the customer of consumer rights, or they are done in a way that the car is sold just below an amount and certain warranties do not apply.

The cheaper the car, often the younger the person is who needs to purchase one, and they are the ones who often get hurt the most and actually have the least recourse. Anything that actually improves consumer protection for people buying cars should be supported. As I said, the other one is not so much for young people, although it could be, but for adults buying their first home, where the workmanship is less than satisfactory.

Over the last couple of years, it would be fair to say that I have received more complaints about shonky workmanship on houses than I have in the previous 14 or 15 years. There may be some reasons for that. I suppose contract prices have been fixed, and sometimes costs have gone up and so perhaps some builders have decided to cut some corners to actually make ends meet. Some of the stories I have heard, if they are half true, are pretty worrying. One person had a house where their ceiling collapsed before they actually moved in. One would worry about the quality of the workmanship of the rest of the house—downpipes, gutters, etc., which are of pretty poor quality; a whole range of issues.

As I think was mentioned by the member for Elizabeth, the two most expensive items people invest in in their lives are probably their home and their car. They are the two in that order, amongst other things, but those two are quite important. We are dealing with one of those today, which is cars. Unfortunately, as I mentioned, the people who are hurt the most by misrepresentations regarding the state of a vehicle are the people who can least afford it, because often they are buying second-hand cars and often they are buying cars at the cheaper end of the scale. Hopefully, this bill will improve the consumer protection rights for younger people or anybody who is purchasing a car.

My understanding is that this bill has arisen as a result of advocacy by the industry through the Motor Trade Association. Having said that, I am also advised that some of the suggestions that have been made actually also improve the consumer protections for people purchasing cars. So it is good to see that what industry wants and what consumers need actually in this case match up and help remove some of the red tape from the industry but also improve the quality of consumer protection for the consumers. I understand that some of these amendments have been advocated by the industry going back to 2016 and have been promoted through the business. I am also glad to see this minister has taken up these changes and brought them before us to look at.

I will talk briefly about the overview of the bill, and then I will go into some more details of the bill itself. One of the key areas which has been discussed already is when the odometer has been played around with, and the actual mileage—is it still called mileage, or is it kilometrage—is not recorded. I have sat in a number of cars where the odometer does not actually move. When I have been a passenger, I have always been interested in knowing what is the actual mileage in the car. It could be that the person does not care or they are just seeking to make sure they get a better resale value.

It is an important issue, though, jokes aside, because it can do two things: firstly, it can misrepresent the age of the vehicle and how much the car has done; but, secondly, it can also misrepresent when servicing and safety checks have to be done, which can be quite dangerous to the person who is actually driving the vehicle. I know very little about cars. I do not even know what people do to wind back the mileage, etc., on a vehicle—I have no idea. All I know about cars is the colour, how many doors they have, how many seats they have and where you put the petrol. That is my knowledge of cars, but it is clear that this happens in real life.

What has been recommended is that the penalties for tampering with the actual mileage of a car need to be changed, which I agree with. Also, in this bill the government has introduced a compensation scheme for victims of tampering. Currently, victims can only obtain compensation when a dealer has been convicted of an offence. Where it is a private seller, no compensation is available under the act.

The bill also seeks to make some other changes regarding disclosure requirements for defects not subject to duty to repair. There are certain provisions regarding waiving rights for duty to repair, waiving and cooling-off rights and amendments to disclosure requirements for previous owner details. I will now go into a bit more detail and into some of the rationale behind some of these changes.

Under new section 23A, under part 4 of the Second-hand Vehicle Dealers Act 1995, dealers and auctioneers selling cars on behalf of dealers have a duty to repair a defect that is present in the vehicle or appears in the vehicle after it is sold. There are number of exceptions to this requirement, including vehicles over 15 years old or which have been driven for more than 20,000 kilometres before the sale. Dealers and auctioneers selling cars on behalf of dealers will now be permitted to disclose defects in the vehicle that will not be subject to the duty of repair.

What is happening here is that as long as a disclosure is made, a person then makes a judgement as to whether they are prepared to pay that price for the car or not pay that price and also perhaps seek to have the vehicle repaired before they buy it. Certainly, the disclosure is important but the disclosure is also subject to the vehicle remaining safe to drive on a road. I think a requirement of all vehicles to be sold is that they are in a form that is safe to be on the road.

In one case I had of a young person, in his view he could not drive the car after a few months, but apparently, because of the price he paid, it was just under the threshold where warranties kick in or rights kick in. Even though it was not a huge amount, he lost all his money because he had no recourse. These amendments also bring South Australia up to date with similar arrangements in other jurisdictions and align with consumer guarantees in Australian Consumer Law.

Under section 33(2), waiving duty to repair rights, purchasers are currently able to waive their right to have a defective vehicle repaired under section 23, duty to repair requirements, by signing the prescribed document. Under these amendments, section 33 will be removed. It will remove the ability to waive this right to have a vehicle repaired under the duty to repair. This approach brings South Australia into line with Australian Consumer Law requirements that purchased vehicles must be of acceptable quality and fit for purpose, and I think this is an important change. It is important that people understand that any product you buy, whether it is a car, etc., should be of acceptable quality and fit for the purpose for which it was purchased.

In regard to waiving and cooling off rights, under section 33 of the current act a consumer intending to waive their right to the two-day cooling-off period after a vehicle sale must sign a prescribed form in the presence of a witness other than the dealer. Under the proposed changes, document 2—which is the prescribed form—is retained to ensure that consumers are clearly informed about the implications of waiving their entitlement to the cooling-off period, but the purchaser will no longer require an independent witness to sign the document.

Previous owner details are something that I had not really thought about. This is actually, when you think about it, not necessarily a bad thing. Under sections 16 and 20, dealers and auctioneers will not be required to display the name and address of a previous vehicle owner on notice of for sale forms under changes to those sections. However, a potential purchaser will still be able to access the information on a request to a dealer or auctioneer, and failure to provide the information will attract a maximum penalty of $5,000.

In circumstances where the information is not reasonably available, Consumer and Business Services will not take any enforcement action against the dealer or auctioneer where, for example, the vehicle has been purchased in another state where the requirement to disclose the previous owner's details does not apply. These amendments seek to streamline sales, preserve the privacy of previous vehicle owners and ensure that consumers have access to information to support their purchasing decisions.

In this case, I am glad to see that there is still a right to that information. If a potential buyer is a bit concerned about how many other people have previously owned this vehicle and how it has been used, I think that is important information which they can still seek. I seek leave to continue my remarks.

Leave granted; debate adjourned.

At 17:31 the house adjourned until Thursday 22 February 2024 at 11:00.