McClay Todd: Non-bank Deposit Takers Bill — Second Reading 
Text is subject to correction 
McClay Todd: Non-bank Deposit Takers Bill — Second Reading 
[Sitting date: 02 August 2012. Volume:682;Page:4253. Text is subject to correction.] 
TODD McCLAY (National—Rotorua) 
: 
 It gives me pleasure to rise and speak on this bill the Non-bank Deposit Takers Bill. What I wanted to say was had the last speaker sought leave to speak after I have spoken I probably would have said yes. But in this case I am not able to.  
Mr Parker is correct that it is not often that the National Government wants to seek additional regulation. Indeed we are firmly focused on lifting economic performance and in many areas of the economy that is moving away from getting rid of unnecessary compliance and red tape that binds businesses takes up their time and stops them getting on and doing the things we want them to do—which is work hard and employ others—and often is meaningless. But in this case I do believe it is important that in looking at economic performance we make sure those who are taking finances on behalf of others are doing so appropriately and that there are appropriate and correct rules and regulations around this to offer the investor a protection but to hold to account those who as we have seen through our newspapers over some very long periods of time and under different Governments have not been held to account to the degree they need to be. Of course I am speaking of finance companies here.  
So the Non-bank Deposit Takers Bill completes several years of work to tighten up the regulation of the sector. I note that in 2006 deposits were about $8.6 billion in the sector and an amount of this was put at risk around finance industry failures. Both sides of this House have tried to work together to tackle this issue and I want to touch briefly on some of the things we have been able to do. We have not always agreed but I do want to say to my colleagues on the other side of the House who sit on the Finance and Expenditure Committee with me that at least in so far as this piece of legislation is concerned I think we were as harmonious as it is possible to be in moving forward.  
I want to say that the Government over the past 3 years has been supporting measures to ensure the right protections are in place to maintain and build investor confidence. And has not that been important as the world—as New Zealand—has struggled with a global financial crisis and great difficulty in investor markets. We have established a one-stop shop—the Financial Markets Authority—which has a sharper focus on the enforcement of the law. Already it is unbelievably active and is acting on behalf of New Zealanders. We are seeing people brought to account being prosecuted but more important than that the rules that have been put in place we see are having good effect when it comes to New Zealanders being able to rely upon the statements that are made by some of these other groups and institutions.  
We have tightened oversight of the working of the financial markets—the 33-year-old securities law leading to the Financial Markets Conduct Bill has been amended. I believe we have improved financial literacy. Minister Bridges is focusing on loan sharks and bringing some very important work to this House I understand and combating anti-competitive behaviour such as price fixing which will be dealt with.  
Hon Clayton Cosgrove 
: Tell us about wheel clamping.  
TODD McCLAY 
: Mr Cosgrove I know you are speaking next and I want to say some very nice things about you so you will do that to me in return. But do not make me think too hard because I might not be able to come up with as many things to say about you as no doubt you will find to say about me as a chairman. But what I did want to say is the bill is expected to become effective—and some of these previous bills—in October 2013 so it is important this House gets on with its job.  
In particular the bill does a couple of things. The Non-bank Deposit Takers Bill will ensure that the Reserve Bank’s ability to promote the maintenance of sound and efficient financial systems will be reinforced. We are going to give a lot of authority to the Reserve Bank when it comes to directors and senior officials being appointed in these non-bank deposit taker organisations and put in place sanctions where changes are made that are not in the best interests of these organisations or of the investor and also not in the best interests of adhering to the laws that we are putting in place.  
When we come to the Committee stage I want to delve into this important piece of legislation in much greater detail. Indeed I do want to say before we go on to my colleagues on the Finance and Expenditure Committee that this was an area where we were able to work closely together and although we did not agree on every issue we were able to debate it widely. I do note that we brought the bill back to the House quite quickly actually. We decided we did not need to take a lot more time because we had done quite a bit of work here together. I just want to commend Mr Cosgrove particularly for the way he is cooperating with the Government in this committee. I do not want to ruin his career but we have been able to move some things back to this committee much faster than they thought we would have been able to otherwise without his sterling cooperation and I thank him for that.