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House of Assembly - Fifty-Fourth Parliament, Second Session (54-2)
2020-09-10 Daily Xml
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Payday Loan Industry

Mrs POWER (Elder) (15:42): My question is for the Attorney-General. Can the Attorney-General please update the house about her plan to address predatory practices in the payday loan industry?

The Hon. V.A. CHAPMAN (Bragg—Deputy Premier, Attorney-General, Minister for Planning and Local Government) (15:42): Members will know that the companies who offer small amount credit contracts, often know as payday lending, have been an issue on the table in Australia for about 10 years. It's been a concern, it's been raised, it's been talked about. The former member for Enfield the Hon. John Rau used to come in here and report to us that it had been raised. Nothing happened.

Since the 2016 federal report on this matter—well, here is the situation. I have indicated to the house before how important it is, especially within the envelope of COVID and people who might be pressed in their financial circumstances to be encouraged to take a payday lending arrangement, to ensure that we maintain some protection of the exploitative practices that can operate in this area.

Consideration was given by the commonwealth, urged by jurisdictions around the country in the New Zealand meeting in the middle of last year. There had been attempts to indicate the urgency about this. Minister Sukkar, the commonwealth Assistant Treasurer, indicated that he hoped to have a draft bill by the end of last year. That hasn't happened. I don't know what is happening in relation to that. But, as I said to the parliament before, if this matter is not progressed in a timely manner, and by 'timely manner' I mean within the year, then we would act.

So just before question time I tabled the government's draft bill to remedy this issue as to the most obvious practices of the industry that need to be curtailed. We can't wait any longer. We are getting on with the job. The key protections in this bill outline some of the matters that I have previously advised them on, but they are as follows:

amending the protected earnings amount from 20 per cent of gross income to 10 per cent;

introducing a protected earnings amount for consumer leases;

prohibiting unsolicited advertising for small amount credit contracts and prohibiting door-to-door selling in relation to consumer leases;

requiring assessments for small amount credit contracts and consumer leases to be recorded in writing;

prohibiting early termination fees in relation to small amount credit contracts and requiring repayments across the life of the loan to be equal;

requiring licensees entering consumer leases to disclose the base price of the good as well as the difference between the base price and total repayments;

requiring licensees to obtain and consider 90 days of account statements before entering into a lease with the consumer; and

imposing a cap on lease payments that applies to all consumer leases.

A copy of the bill will be available on the CBS website. In relation to this matter, I want to thank the commissioner, Mr Dini Soulio, who is well known to members, for his and his team's support in developing this reform and the advice that he has given. We must protect vulnerable South Australians. We will get on with the job to protect our own here. I encourage other jurisdictions, of course, and the commonwealth, if they finally decide to do something about this, to protect the rest of Australia.

The SPEAKER: I call to order the Deputy Premier for interjections prior to the question from the member for Elder and just remind all members that, whether before a question is being asked or in the course of the asking of the question in particular, it makes it difficult for me to give the call and then to understand the question if there are interjections across the chamber.

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