Monday, 9 November 2020
National Consumer Credit Protection Act 2009
That the Senate—
a) notes that, in respect of responsible lending to consumers, and the provisions of the National Consumer Credit Protection Act 2009 (NCCP Act) in particular, the final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (the Royal Commission):
i) noted that there was little or no debate about the terms of the NCCP Act,
ii) emphasised that the submission from Treasury stated that abidance by existing laws would likely enhance rather than detract from macroeconomic performance, and
iii) concluded simply that the law should be applied as it stands;
b) further notes that the Government, in February 2019:
i) accepted recommendation 1.1 of the Royal Commission that the NCCP Act not be amended to alter the obligation to assess unsuitability, and
ii) agreed to take action in relation to all 76 recommendations of the Royal Commission; and
c) notes that the Government has reneged on its previous acceptance of Recommendation 1.1 of the Royal Commission; and
d) condemns the Government for failing to honour its acceptance of Recommendation 1.1 of the Royal Commission.
The government has not reneged on its acceptance of the recommendation of the royal commission. Recommendation 1 states:
The NCCP Act should not be amended to alter the obligation to assess unsuitability.
With respect to the recommendation, Commissioner Hayne noted:
Consumer advocacy groups urged me to recommend that the NCCP Act be amended to require lenders to determine whether a loan contract (or credit limit increase) was 'suitable' for the consumer (as distinct from 'not unsuitable'). I do not favour that proposal.