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Legislative Assembly for the ACT: 2001 Week 7 Hansard (20 June) . . Page.. 2248 ..

MR STEFANIAK (continuing):

As ministers are yet to consider the New South Wales proposal and ours-I think they are really pretty complementary-it is too soon to predict the particular form of the outcome other than to say that the probability of an outcome that addresses the type of problems identified by Mr Rugendyke on a national level is now high.

We do not disagree with the sentiments expressed by Mr Rugendyke. I think they are eminently sensible. It is ludicrous that a person should be lumbered with debt without proper assessments being made of the debtor's ability to pay. That benefits no-one-the debtor or indeed the creditor. It is commonsense to do these things.

I will be taking Mr Rugendyke's bill to the council. I am sure they will carefully consider it and other proposals, with a view to resolving the problems, hopefully coming back with model legislation which we will be able to introduce very quickly. I commend Mr Rugendyke for his actions here. They greatly assist everyone-not only debtors but creditors as well. It is sensible stuff, and I am very happy to take forward his bill and argue its merits with my colleagues in July.

MS TUCKER (9.42): The Greens will be supporting this motion. It is a step towards prohibiting unsolicited pre-approved offers of extensions to credit limits. This is an unethical practice which has led to people overextending themselves financially at vulnerable times, and we agree that it should be illegal.

This motion refers to legislation on the table which proposes amendments to the ACT Fair Trading Act to make this practice illegal, consolidate the existing requirement that credit be offered only when it has been requested in writing and tighten up the definition of credit card. But apparently the Ministerial Council on Consumer Affairs and its primary instrument the Australian Uniform Credit Laws Agreement 1993 make it difficult for an individual state or territory to increase credit protection without the prior unanimous agreement of the council.

Lending companies' practice of sending letters offering pre-approved extensions to credit limits has been around for a while. But the bill-and hence this motion-I understand, grew out of the reaction to the practice in the lead-up to Christmas last year. I first heard of Mr Rugendyke's work on this issue in discussion with the community sector following representations from constituents on the high level of unsolicited credit offered in that period. I must say I felt a bit beaten to the chase, and I would like to congratulate Mr Rugendyke for working on this issue. It does need attention. I am sure Mr Rugendyke would join me in also acknowledging with gratitude the expertise of people in the ACT community. It is a great thing for the community to have advocates who not only provide a valuable community service but also keep legislators in touch with problems and ideas on how we can possibly deal with them.

It is a sad fact that Christmas in our society is a time of big spending and consumption, fuelled by a curious sense of almost religious obligation to spend up on presents, so it is the time when people are most likely to be persuaded to overextend their credit. In the pre-Christmas period, November to December, 1997-admittedly a few years ago-Reserve Bank figures showed that credit card debt increased nationally by $450 million. To put that into context, at that time nationally, around $8.2 billion dollars was owed on bank credit cards.

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