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Monday, 17 August 2009
Page: 8083


Mrs GASH (7:15 PM) —To my colleague the member for Isaacs opposite: I do not care who was in government. It is now the Labor government, so let us get on with fixing the problem. I second the motion of my colleague the member for Canning and thank him once again for continuing to keep this important matter before the parliament and the government. I just hope that the government is listening. It has been over three years since I first brought it to the attention of the House, and when we were in government three years ago I did bring to the House as well the matter of Baker’s Delight, which adversely affected a constituent franchisee in my electorate of Gilmore. Since then there have been a flood of cases, suggesting that all is not well within the Australian franchising sector. Franchisees continue to suffer at the hands of rogue franchisors. Members from both sides of parliament have heard the horror stories about unscrupulous franchisors. We continue to hear stories about the ACCC’s inaction. Sadly, some franchisors still engage in questionable and unethical practices. The ACCC continues to be ineffectual in stamping out the rogue franchisors. Little wonder that franchisees have little faith in the ACCC’s ability to protect them from those rogue franchisors. Through the bipartisan approach of members of this House, the government established an inquiry whose report was handed to the minister in December of 2008. There it sits silent while franchisees suffer. Despite the wealth of evidence before the inquiry in support of the hundreds of complaints from franchisees, nothing has emerged since the Ripoll franchising report.

We are looking for leadership on this issue but all we are finding is silence from Minister Emerson. It is not only the opposition calling for urgent action; members on the government side are also calling for action. Franchising transcends political boundaries. It involves real people with real problems, even tragedies, as a result of their dealings with rogue franchisors. We are all waiting for a sign from the minister. We urge the minister to act swiftly on behalf of franchisees. The ACCC must also act. The concerns I raised with the ACCC at the time were never satisfactorily addressed, and this remains the case. For the life of me I cannot see how, despite the many hundreds of complaints lodged, the ACCC can continue to watch. There is something patently lacking when it comes to the ACCC, and I urge the ACCC to act rather than watch.

A key element flowing from the recommendations of the committee was to insert a good faith requirement in the Franchising Code of Conduct. That alone will not be enough. We also need a statutory definition for what constitutes unconscionable conduct under the Trade Practices Act. The good faith provision in the code of conduct can and should include a definition of what is meant by good faith. Such definitions can draw on court decisions and can be easily included. I can only reiterate my earlier call for a dedicated franchise tribunal or ombudsman that has the power to finally settle disputes. To me that is a realistic and practical option and I would encourage the government to pursue that option. I welcome provisions in the Trade Practices Act imposing pecuniary penalties for breaches of the franchising code. They would act as a deterrent, and of course penalties must be meaningful. When I think of the millions of dollars involved in churning, the sanctions need to be significant. Of course access to justice is essential. That is why a tribunal or ombudsman has been an attraction for me. The longer this minister procrastinates, the more people will get harmed through churning and other unethical practices by rogue franchisors. The longer this minister procrastinates, the more we will be encouraging the very type of behaviour this House is trying to stop. Australian franchisees deserve decisive action from this government. The minister’s immediate interest is needed. The minister must act, and if after eight months he still has no plan in place, let him to step aside for someone else who will act decisively. People’s lives have been ruined and it is still happening. Again I call on the minister to act now and once again investigate the reasons for the nonaction by the ACCC.