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Monday, 4 July 2011
Page: 3923


Senator SHERRY (TasmaniaMinister Assisting on Deregulation and Public Sector Superannuation, Minister for Small Business and Minister Assisting the Minister for Tourism) (17:25): I indicate that my remarks apply to the other amendments, Senator Xenophon, so I do not want to unduly take the time of the chamber and be repetitive. The government will not be supporting the amendĀ­ments. We do understand your intenĀ­tion, Senator, in moving the amendment and your commitment to a better deal for consumers. You have been very consistent in that approach over many years. However, the government cannot support the amendments, as they duplicate laws we have already created and would put their enforcement at risk. The government has already banned exit fees for all lenders, not just the big banks. Making any further regulation in this space is therefore unnecessary. It would create significant difficulties for our financial regulators in enforcing an exit fees ban on new home loans.

The government has already given ASIC the power to prosecute any fee in any credit contract that is unfair or unconscionable to consumers. These powers are contained in section 128F and 12CB of the ASIC Act. Duplicating these laws with inconsistent tests and definitions would put at risk ASIC's ability to prosecute under our existing laws, and that in turn would risk letting the banks off the hook and hurting consumers. Therefore we cannot support Senator Xenophon's motions to amend.