Murray Watt (Queensland, Australian Labor Party) Share this | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Finance (Senator Cormann) to a question without notice asked by Senator Marshall today relating to payday lenders.

I know it's some time ago, after all of the debates we have just held, but the topic of the answer that I am taking note of concerns the government's continued failure to take action against payday lenders. It's not surprising that they are failing to take action against this insidious form of credit, because, if you believe half of the media reports that are circulating at the moment—the ones not about the Deputy Prime Minister—it seems yet another parliamentary friends group has been created in this place: the 'Parliamentary Friends of Payday Lenders'. If there were one organisation or group in the community you would want to associate yourself with, you wouldn't have payday lenders up there, but it seems a number of government members are cosying up to payday lenders, defending their interests against the needs of poor and vulnerable people, and have brought pressure to bear on the government to the extent that the government has withdrawn legislation it was working on.

It's particularly disappointing that some of the names circulating as those who've been fighting hardest for the interests of payday lenders in this parliament have been National Party members—or LNP members, as we call them in Queensland—who represent rural and regional electorates with great degrees of poverty. We know very well that payday lenders prey particularly on the poorest and most vulnerable people in our communities, people who have run out of other credit options and who are forced into a position where, simply in order to pay their bills and get by from week to week, they take out loans at exorbitant rates, which spiral up, with the result that they owe, in some cases, hundreds or thousands of dollars more than they originally borrowed. I'm very surprised, for instance, to see the member for Dawson, Mr Christensen, being one of the most vocal supporters of payday lenders. He knows very well that his electorate has substantial pockets of poverty in it. Rather than coming into this house and defending his constituents from the rapacious payday lenders who are ripping them off, he's siding with those very same payday lenders.

I'm pleased, though, with the significant efforts by Labor representatives who've taken up this cause in parliament of late—in particular, our shadow minister for consumer affairs, Tim Hammond, and my Queensland Labor colleague the member for Oxley, Milton Dick. I know that builds on the work of Senator Cameron and many others on this issue over many years. We want to see much tighter regulation of payday lending. We think that it is a good idea to put some caps on the amount that debts can climb by, so that people don't get themselves into a situation where they might borrow to buy an appliance whose shelf price is a few hundred dollars, only to find a couple of years down the track that they've ended up being charged in the thousands of dollars, because of the outrageous interest rates that are imposed upon those borrowers by payday lenders. Those figures are no exaggeration. There are many instances where people are signing up to initial loans for hundreds of dollars which, by the end of their loan, end up being thousands of dollars, literally. That is absolutely wrong, and we should be taking action against it.

That's why Labor has introduced a private member's bill to take some action against these payday lenders. It's very surprising that, because of this pressure that has been imposed upon ministers by government members such as the member for Dawson, they have backed off introducing legislation that would have done something about this problem. But rather than let this issue lapse, Labor is grasping the nettle. We have introduced a private member's bill in exactly the same terms as the bill which was proposed by the government. If they are not prepared to take some action against payday lenders, then Labor most certainly will. Far too many people in our community are hurting as a result of payday lenders, and this kind of legislation will make a difference. When this bill goes before the parliament, it will be a real test for people like the member for Dawson, the member for Capricornia and the member for Forde—LNP representatives of areas with great poverty and people being ripped off. If they're on the side of their constituents and want to stop the rip-offs, they'll vote with Labor, but if they want to side yet again with Prime Minister Malcolm Turnbull and his big business mates, they'll vote against it.