Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Hansard source

I too rise to speak on the Trade Practices Amendment (Clarity in Pricing) Bill 2008. Consumer protection is clearly a matter of critical importance to the Rudd Labor government. We know that mums and dads around the country, their children, their parents, the people for whom they care, are the people who are at the very heart of this federal government’s work of modernising Australia for the 21st century. We have all heard about the different policies that the Rudd Labor government is delivering. We all know about the education revolution and the vital inclusion of information technology within the classroom and at home. What better typifies this government’s focus on preparing our population for what will be a dynamic and challenging century?

There are initiatives that the government is pursuing, such as the education revolution, that will better prepare people for the future. There are also many initiatives that deal with the present and that focus on everyday consumers—mums and dads and those that they care for. Yes, things have become increasingly tough for people since the introduction of the GST, but, to this government’s credit, as we have heard today, it continues to provide tremendous support to multiple sectors of the community through the $10.4 billion Economic Security Strategy. Through this Economic Security Strategy the Rudd Labor government is caring even more for pensioners, as we heard today, helping first home buyers more than those opposite would have dreamt of and of course providing additional support for 1.9 million families and 3.9 million children.

This clearly is a government for all Australians. In addition to redistributive measures, the government has just recently released its green paper on financial services and credit reform. This reform will lead to a reduction in the vast proportion of unsolicited offers of credit cards and unsustainable increases in available credit. This in itself will protect tens of thousands of Australian households from unscrupulous financial behaviour.

But tonight I rise to speak in favour of the other initiative that I mentioned at the beginning of my speech, designed by this government for the financial protection not just of the mum and dad consumers around the country but of all people who wish to make a purchase—that is, the government’s Trade Practices Amendment (Clarity in Pricing) Bill 2008. The practice that this bill will address when it becomes law is the practice of deceitful quotes. These are quotes that are made by the seller of a product or service with the full knowledge that the price that is being quoted is totally wrong and is substantially less than anyone would end up paying. The practice of misrepresenting the true cost of a purchase to the consumer, at least in this case, is called component pricing. The quote consists of part of the full purchase, but certain things are left off the quote, such as taxes, fees and charges, to make the purchase sound better value and more affordable. Retailers may as well have been giving potential customers two prices—one accurate, that the person will eventually have to pay for the product, and one totally made up, fictitious and misleading.

It is generally the lower of any two quotes that a person will remember. So we could effectively have retailers answering the question ‘How much does it cost?’ with the answer: ‘I’d say only $12.99, but then again it could be $20 when you add other costs such as taxes and fees.’ Handing over a credit card would result in a shock for the consumer either at the time they are expected to sign the credit purchase slip or when they realise that they were ripped off maybe a month or three later when their statement comes. The deceit of this practice is what the government is targeting in this bill.

I note as an aside that the previous government looked at this issue during the course of its time in government. The Howard government announced that in the first half of 2005 it intended to do something about component pricing. A year later it released a draft bill and explanatory memorandum for public consultation. The bill was up on the Treasury website for some years, but the issue was allowed to drift without the prospect of any form of resolution.

It was a constituent of mine who brought the stalled legislation more sharply to my attention. Mr Colin Leaker of Somerton Park has pursued this issue since around mid-2005. I quote from some of his letters regarding component pricing and the stalled bill:

… my recollection from the early press reports is that no particular difficulties were flagged at that time in regard to implementation.

…                     …                   …

My strong view is that the legislation is urgent and important to consumers.

I am pleased to be able to inform Mr Leaker in my electorate that the Rudd Labor government has this situation, like so many others, well in hand. Those opposite, after doing the hard work, decided that they did not support their own bill back in 2006. If they think back and remember the merits of the initiative and how it got through their party room, perhaps they will remember that they were supportive of it at some stage. Here and now they can vote for it. Most importantly, I ask all members to think of the mums, dads, children, families and consumers around the nation and support a legislative measure designed to offer protection to support all those consumers. I commend the bill to the House.

See this speech in context