Faafoi Kris: Credit Contracts and Financial Services Law Reform Bill — In CommitteeText is incorporated into the Bound VolumeFaafoi Kris: Credit Contracts and Financial Services Law Reform Bill — In Committee[Sitting date: 13 May 2014. Volume:698;Page:17797. Text is incorporated into the Bound Volume.]KRIS FAAFOI (Labour—Mana): Well finally—finally someone from that side of the Chamber has shown some passion about this issue. Congratulations to you Minister Foss on getting up and having some passion but where was that 4½ years ago when this process started? Where was that passion when you started out on this whole process to make sure that the people whom you are talking about those vulnerable borrowers out in our communities were getting protected? This was such a priority when it started in 2009 and here we are in May 2014 and finally we are getting something done about it. So thank you for getting passionate about it but on this side of the Chamber we are not quite believing how much of a priority you have made this piece of legislation the Credit Contracts and Financial Services Law Reform Bill for all those vulnerable people you claim you want to protect.If you did want to protect them you would have done something about this a long long time ago. This is a debate on the title and commencement date. This piece of legislation could have commenced 2½ to 3 years ago if this Government really prioritised the needs of the vulnerable people whom the Minister was just a little bit passionate about before. This process started in 2009. Then Simon Power had a summit in 2011 and then a Cabinet paper was presented to Cabinet and came out in October 2011. It has been sitting and doing nothing—nothing—until now. So I say to the Minister that he should not get up and puff his chest out as though this has been a priority for him. It has not been Minister. It has not been a priority for this Government at all.If it were a priority you would have looked with a bit more passion at the Supplementary Order Papers regarding interest rate caps too but you have not done that. The Minister in the chair the Minister of Consumer Affairs put his arms up and said it was all too hard. Well it was not too hard for the UK it was not too hard for the US and it was not too hard for Canada but here in New Zealand it is all too hard. The Government says: “Oh we can’t do that. It’s impossible.” Listen to what the Minister said when he spoke up: “We can’t do it. It’s too hard.” Well why can other countries do it and we cannot? Why can Australia do it and we cannot? If you are really serious about protecting the people whom this bill pertains to Minister you would have done something about this a long long time ago and you would have looked at those interest rate caps.That Minister can get up there and all of a sudden get passionate because one party is not supporting the Government all of a sudden but that just does not wash with us because 3½ years ago you guys could have got off your chuffs and actually done something. In those 3½ years a whole lot more vulnerable families have been affected by loan sharks and you guys sat on your chuffs doing nothing about it. We started this process at the end of the last Labour Government because we knew it was becoming an issue but you guys sat on it and you did nothing. Then all of a sudden it became a bitmore of an issue. Simon Bridges made a few noises and then it went quiet again. Then it comes back and all of a sudden this is the best thing since sliced bread 4 months out from an election. Well it does not wash with us. You could have done something much much sooner.We have talked about different titles for this bill. I think we should change it to the “Credit Contracts and Financial Services (Blame Peter Dunne) Bill” because Peter Dunne had the one vote that could have changed this bill to make sure there was a protection for those vulnerable families we were talking about by introducing those interest rate caps. But he turned again and now that measure has not gone through just like with the asset sales legislation. Peter Dunne had the vote that changed that. Here we have a piece of legislation that would have protected vulnerable families from those loan sharks who are charging up to 700 percent interest—not 30 not 35 not 40 but in some cases 700 percent we are led to believe. But that is OK with Peter Dunne. That is OK with the National Party: “We don’t need to do anything there. That is fine.” Well it is not fine with us on this side of the Chamber.If you thought about it and listened to a lot of the people who came and made submissions—and I know that some people on that side of the Chamber might get up take a call and say there are reasons why they did not do it. If you listened to the submissions of the people working at the grassroots you would have looked at it a lot more seriously than you have. It would have been a real protection in this bill for those vulnerable families. It would have sent a pretty good message to those third-tier lenders that we do not like what they are doing that they have been ripping off people for too long and that we are cracking down on them. But this Government did not do that. It did not make it a priority. It did not make this bill a priority and then all of a sudden we get a passionate speech from the Minister in the last reading of the Committee stage. Well thank you very much Minister but it is all too late. It is all too late. It is 3 years too late.Again I want to say about Peter Dunne that he turned on this big time. Carol Beaumont introduced a piece of legislation in the last term of Parliament that would have essentially introduced interest rate caps. Peter Dunne sent a letter to someone who was behind the scenes helping with that bill and he said: “I was happy to support this bill and was very sorry that it did not proceed past first reading. I hope that further progress will be made on this issue in the future.” That bill that Peter Dunne was talking about essentially would have introduced interest rate caps. So on 28 July 2010 Peter Dunne was all good with interest rate caps: “Sign me up.” He was ready to go. He knew that the interest rates were unfair. But all of a sudden he has changed his mind. And why? Does he think all of a sudden that it is OK to have 500 600 or 700 percent interest rates for the most vulnerable people in our communities for those who cannot afford that? Is he OK with that? Is the Government OK with that? Something changed between 28 July 2010 and when this piece of legislation came into the House. He did a complete U-turn and all of a sudden it is OK for those third-tier lenders those loan sharks to charge exorbitant interest rates.So if you are looking for an alternative title add “(Blame Peter Dunne)”. “(Blame Peter Dunne)” should be added to whatever is the name of the bill that we are debating. He was the one who made sure that something that would have been a massive protection for those families out there was not included in this bill. So I say to Peter Dunne that he has a lot to answer for: asset sales and also making sure that these families are not protected from exorbitant interest rates.We have also heard from the Minister about extra resourcing for the Commerce Commission. He mentioned some extra resourcing that the Minister for Social Development may have announced earlier around budgeting services. That is good buthe did not actually answer the question about the resourcing for the Commerce Commission. As I said in an earlier speech in this Committee stage we want to make sure that the Commerce Commission has resources on the ground right around New Zealand to make sure that what we are putting in this bill is effective. He may have skirted around that and some other funding for budgeting services.We want to make sure that the Commerce Commission which has not really made this a priority in the past is on the ground and has got people in there who understand these communities and are doing work to make sure that they understand who is still acting badly who are the loan sharks who are still doing dodgy deals who are those affected and who is being educated about this new code of responsible lending. That is what we want. We want a commitment on that to make sure that the Commerce Commission does not just have someone who is well meaning who is based in Māngere and who is the only poor sod doing this. There need to be people right around the country working with that one person to make sure that the communities in Invercargill in Dunedin in Christchurch in Wellington and in my area of Porirua—which is affected quite a lot by loan sharks and those truck shops that we are talking about—are getting the information and the help they need. I know that the Minister in the chair said that his previous speech was his last contribution to the debate but maybe he could make one more and specifically talk on that issue of the Commerce Commission getting the right resources and changing its attitude from being a high-level regulatory body to getting down there and getting stuck in the weeds with people to find out what is going on with these truck shops with these third-tier lenders in order to make sure that it is making a difference to the people on the ground.This is a good piece of legislation but it is a missed opportunity. It is a missed opportunity because we could have supported Carol Beaumont’s Supplementary Order Paper 430 to bring in interest rate caps. That side of the Chamber is OK with interest rates of 50 and 100 percent and beyond. We are not OK with that. That is why we introduced this Supplementary Order Paper. We thought the Government might have given it a lot more thought than it did but it did not. It is a lost opportunity. I think we should blame Peter Dunne for that because he was OK with it 4 years ago and all of a sudden he is not.