Fair Trading Amendment (Cash Loan Machines) Bill 2019
30th May 2019
Mr GREG PIPER (Lake Macquarie) (11:25:45): It may come as no surprise that I support the
Fair Trading Amendment (Cash Loan Machines) Bill 2019 and the member for Swansea, and shadow Minister for Innovation and Better Regulation, in her pursuit of justice for the most vulnerable people in New South Wales who are being enticed further into a debt trap that the State Government can alleviate. The Government, and the member for Ku-ring-gai in particular, have shown that they understand the risks to vulnerable people in our communities but they choose not to pursue this matter with the vigour that people are pleading for. This is a vile industry that has established itself in New South Wales, and indeed across Australia.
We have only to look across the Pacific Ocean to the United States of America to see this problem at its absolute worse. Payday lenders—whether bricks-and-mortar or online lenders or vending machines—always target the most depressed and vulnerable communities in that country. Exactly the same model is being rolled out in New South Wales and across the country. I listened to the contribution of the Minister for Innovation and Better Regulation and it is clear that he understands the situation. I was pleased to hear that the Minister is passionate about taking up this matter. But that does not negate the good intentions of the member for Swansea and her attempt to legislate in the New South Wales Parliament to address the problems within our communities.
We know that payday lending involves not only vending machines but also online payday loans and bricks-and-mortar establishments. It is not dissimilar to the loan sharking we saw many years ago. Perhaps today people do not have their knees broken or suffer assaults by lenders trying to extract payment and take vengeance, but the financial implications and pain remain for the individuals affected and their families. We must address this issue. These machines are not a financial leg-up for people in financial distress. They are not intended to be a leg-up; they are the exact opposite. They trap people in poverty and impact entire communities. All of the nine instant payday loan machines currently operating in this State are located in lower socio-economic areas, predominantly in the Hunter and on the Central Coast and the South Coast. They are clearly targeting the demographic that they see as susceptible due to relatively low incomes and no doubt lower financial literacy. I appreciate the contribution of the member for Ku-ring-gai but, as the member for Wollongong pointed out, it is very unlikely that they will be seeing in their office people who have been caught by this particular trap.
There are alternatives. Unfortunately, many of these people are not financially literate to the level that we would hope they would be. The Australian Securities and Investments Commission's MoneySmart website provides a number of alternatives and advice for people who are caught in financial circumstances where they might need short-term money loans. As has been suggested, there is a whole range of reasons why people may be there. It may be due to health concerns in the family, a sick child or a sick wife or a sick husband. It might be that somebody has been laid off and just cannot cover their bills. It might be that they need to put new tyres on the car to be legal, to register it, or even to drive on the street to look for a job. It may well be that they have some legal situation. It could be that people end up in a fine trap.
I am very pleased to hear that the Minister has gone to his Federal counterpart to address this broadscale issue that he has rightly identified. But I suggest that with the dispersion of cash machines across New South Wales this industry has crossed a line, and I thank the member for Swansea for bringing this to our attention. It is well and good to talk about the Constitution and the Federal jurisdiction. The fact of the matter is that this issue warrants discussion in this Chamber because it is affecting people in our communities. If we can raise it here and more members of Parliament and more members of the public—particularly members of the media—know that we are on to it, we will suss out this vile industry and that is a good thing. I wish that the bill could be passed here today but this is an Opposition bill and, regardless of its merit, that is not likely to happen. I recognise that the Minister has identified that this is a genuine issue and it is going to be pursued at a higher level. We have a local and national responsibility to do whatever we can to look after our local communities.
Once again I thank the member for Swansea for bringing this to our attention. I thank and acknowledge the Minister for what is clearly his recognition of the problem. I call on him to make sure that this issue is not forgotten and that it does not just drop off the edge, which happens so often. I was talking to the member for Wollongong about another issue in the same space. In 2011, under this Government, we started talking about the rollout of sports betting around New South Wales and Australia and we tried to take that on. There were some slight improvements and, all of a sudden, it fell off the radar. That industry has become ubiquitous. It has won. I do not know that it could ever be rolled back. I do not want to see the same situation happen with cash loan machines. We must ensure that we address this issue because this particular industry is targeting the most vulnerable people in our community.
Website: Read full parliamentary debate here