Lole-Taylor Asenati: Questions for Oral Answer — Questions to Ministers Questions to MembersText is incorporated into the Bound VolumeLole-Taylor Asenati: Questions for Oral Answer — Questions to Ministers Questions to Members[Sitting date: 20 February 2014. Volume:696;Page:16185. Text is incorporated into the Bound Volume.]4.Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First) to theMinister of Consumer Affairs: Does he believe he is doing all he can to protect consumers particularly vulnerable low income families?Hon CRAIG FOSS (Minister of Consumer Affairs): The Government is taking a number of steps to protect consumers—particularly vulnerable low-income families. The passage of the Consumer Law Reform Bill will protect consumers by giving moreprotection under the Consumer Guarantees Act and implementing unfair contract provisions so that consumers do not get stung. The Commerce Committee is currently considering the Credit Contracts and Financial Services Law Reform Bill. This bill will help protect vulnerable low-income families by cracking down on dodgy loan sharks and helping families to become more informed when making financial decisions.Le’aufa’amulia Asenati Lole-Taylor: Does he think that it is fair that vulnerable low-income families investing $50 per week are paying up to $20 a week in fees which is 40 percent?Hon CRAIG FOSS: I am not sure of the question. It seems like an investment and financial markets question. Families investing $50 per week—I am just not sure of the question but the Financial Markets Authority is available to administer investment and financial issues. There are financial dispute resolution services to deal with dispute matters as the member addresses. There have been examples recently of totally unacceptable behaviour by some in some communities with similar amounts to what the member mentions and I understand that the police have been looking into those matters.Le’aufa’amulia Asenati Lole-Taylor: Is he aware of Noah’s Ark Foundation a savings scheme scam where low-income investors can pay as much as $1000 a year in fees on savings as little as $5000?Hon CRAIG FOSS: No I am not. If the member is alleging—well that sounds like some pyramid scheme or something like that. That is illegal under existing law and I advise that member to take those matters to the appropriate authority as soon as possible.Te Ururoa Flavell: Is he aware that most interest rates for pay-day lenders operating in New Zealand are between 400 percent and 600 percent and when will he follow the lead of Australia America Britain Japan Singapore France Germany Switzerland Canada Mexico and almost all of South America in applying interest rate caps on pay-day lenders?Hon CRAIG FOSS: I thank the member for the question. That particular issue was and is part of extensive consultation on the Credit Contracts and Financial Services Law Reform Bill. This and other matters are currently under consideration by the Commerce Committee and I am looking forward to its report.Le’aufa’amulia Asenati Lole-Taylor: Is the Minister aware of concerns held by Māngere Budgeting Services Trust that investors with Noah’s Ark Foundation are bound to save a minimum of $50 a week for a minimum of 5 years—a very long time for low-income families?Hon CRAIG FOSS: As I said I am not aware of the particular fund or whatever that is that the member describes but I do acknowledge the Māngere Budgeting Services Trust which participated in a consumer forum we had recently in Auckland. I commend it for its ongoing good work on behalf of so many in our community.Le’aufa’amulia Asenati Lole-Taylor: What will the Minister do to improve the financial literacy of some of our most vulnerable people to ensure that they do not fall prey to dastardly schemes such as this?Hon CRAIG FOSS: The member raises a very good and important issue around financial literacy particularly in parts of our more vulnerable communities. I acknowledge the launch of The Exchange last year pulled together by the Commission for Financial Literacy and Retirement Income which is charged with financial literacy in New Zealand which will be particularly targeting and working in communities that I think the member is very aware of. I look forward to participation by all sorts of community organisations and NGOs as that gathers its own steam.Le’aufa’amulia Asenati Lole-Taylor: What does he have to say to Mr and Mrs Lilomaiava who have been saving for quite some time and who have been prevented from buying a home where they want to buy one and subsequently upon requesting their savings were told that they had to pay a penalty of $1500 plus communication through legal representation only?Hon CRAIG FOSS: I suggest that that family take advice or the member may help them and direct them to a place where they can take advice and make a complaint because some of what she described there does sound to be quite pushing the margin of existing law.Te Ururoa Flavell: Does he support the work of the Ministerial Committee on Poverty; if so when will he introduce interest rate caps to protect loan shark victims 90 percent or thereabouts of whom are Māori or Pasifika?Hon CRAIG FOSS: Yes I do support the very good work of that ministerial committee and know that some Māori and Pasifika families are indeed vulnerable to loan sharks and predatory behaviour by some in our community unfortunately. I know that they will be benefiting from changes in the bill that is currently before the select committee. Issues around interest rate caps are being considered by the committee still I understand but I note that there was not widespread support for them in submissions although they are still an option before the committee.Carol Beaumont: Why has this Government not fulfilled John Key’s 2011 undertaking to get tough on loan sharks given the Hamilton budget service seeing 100 percent interest rates this year on loans to struggling families?Hon CRAIG FOSS: This Government is extremely tough on loan sharks. The bill before the committee—a committee that I think that member is on—actually makes life somewhat more difficult for those who prey on the most vulnerable in our community.