Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Minister's crack-down on loan sharks a crack-up

Minister's crack-down on loan sharks a crack-up


Loan sharks profiteering from our poorest communities will be laughing out loud as they read the ineffectual restrictions included in the latest version of the Credit Contracts and Financial Services Reform Bill.

Lenders who already have good systems in place will not be affected by the changes. Loan sharks also know they will not be affected by the improved protections for borrowers, including responsible lending practices, because their clients are most unlikely to be aware of their rights or understand what 'responsible lending' means. Unscrupulous lenders know
the borrower who is desperate to get the fridge or the car fixed, or food on the table for their children, will not grasp the significance of a daily 1% - 2% interest charge.

Dr Claire Dale, spokesperson for Child Poverty Action Group and a trustee of Nga Tangata Microfinance Trust says "We are pleased to see the introduction of clearer tests for unreasonable credit fees and default fees, and more clarity around the guidelines for the Courts to reopen 'oppressive' credit contracts. However, the clients we see at Nga Tangata often come from communities where 50% to 100% interest is a comparatively 'good' rate, so what would be unreasonable?"

These borrowers are 'oppressed' by high interest loans because they may have a bad credit rating, or are nervous about being turned away by mainstream banks. Loan sharks are likely to be the only lenders in walking distance.

The Government is targeting unscrupulous lenders by putting the onus on consumers to make informed decisions and to know their rights. The consumer also has to know where to go and what to do if those rights are impinged. A person borrowing from a loan shark cannot afford legal representation to pursue their rights when their goods are
repossessed or their house is stripped when their repayments are late. This makes the increased penalties for creditors breaching credit laws an empty threat.

Dr Dale says "There is no balance of power between loan sharks and their clients, so the role for the Government is clear. To provide genuine protection for consumers, the Government needs to cap interest rates, like most of the rest of the civilised world including Australia, USA, 21 European countries, Japan and South Africa." A maximum all-inclusive
charge for interest and administration would protect the vulnerable and desperate consumer, and put an end to the cruel and enduring financial torture so many of our poorest families are suffering. "It is time to mend these huge cracks in consumer protection."

--ENDS--

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell:
On Pharmac, Gough Whitlam And Sleater-Kinney

Ridiculous reported comments on RNZ this morning by Trade Minister Tim Groser, as he sought to dampen down concerns about the leaked draft of the IP chapter of ther Trans Pacific Partnership negotiations. According to Groser, ‘extreme’ positions are common at the outset of negotiations, and these get whittled down over the course of negotiations. Fine.

Except that we’re not at the outset of these negotiations. The outset was six years ago, and negotiators were hoping to have some sort of ‘framework’ deal finished in time for the APEC meeting in a few weeks’ time. These ‘extreme’ positions are what we’ve reached near the intended end of the negotiations.

Still, Groser did promise that the cost of medicines would not rise as a result of the TPP trade deal. Great. But this is not what politicians in other countries are saying. More>>

.

 
 

Parliament Today:

Aussie Investigation Dropped: Call On Minister McCully To Pursue The Case Of Balibo Five

West Papua Action is deeply concerned at the lack of any clear outcome from the Australian Federal Police inquiry into the 1975 deaths of the ‘Balibo Five’ including NZ journalist Gary Cunningham. More>>

ALSO:

'Feed The Kids' Bill: Metiria Turei To Lead Fight On Feeding Hungry Children

Green Party Co-leader Metiria Turei is urging all political parties to support the Feed the Kids Bill which she inherited today from Mana leader Hone Harawira. More>>

Parliament Today: State Opening Of Parliament

The House sat at 10.30am on Tuesday before MPs were summoned to hear the Speech from the Throne in the Legislative Council Chamber. More>>

ALSO:

Tertiary Education: Students Doing It Tough As Fees Rise Again

The Government is making it increasingly difficult for Kiwis to gain tertiary education as fees continue to rise and access to student support becomes even more restricted, Labour’s Tertiary Education spokesperson Chris Hipkins says. More>>

ALSO:

Housing, Iraq: PM Press Conference – 20 October 2014

Prime Minister John Key met with press today to discuss:
• Housing prices and redevelopment in Auckland
• Discussions with Tony Abbott on the governmental response to ISIS, and New Zealand’s election to the UN Security Council More>>

ALSO:

Labour: Review Team Named, Leadership Campaign Starts

Labour’s New Zealand Council has appointed Bryan Gould as Convenor of its post-General Election Review. He will be joined on the Review Team by Hon Margaret Wilson, Stacey Morrison and Brian Corban.

ALSO:

Roy Morgan Poll: National Slips, Labour Hits Lows

The first New Zealand Roy Morgan Poll since the NZ Election shows National 43.5% (down 3.54% since the September 20 Election). This isn’t unusual, National support has dropped after each of John Key’s Election victories... However, support for the main opposition Labour Party has crashed to 22.5% (down 2.63% and the lowest support for Labour since the 1914 NZ Election as United Labour). More>>

ALSO:

In On First Round: New Zealand Wins Security Council Seat

Prime Minister John Key has welcomed New Zealand securing a place on the United Nations Security Council for the 2015-16 term. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news