Jenny McAllister (NSW, Australian Labor Party, Shadow Cabinet Secretary) Share this | Hansard source

I wanted to pick up on some of the questions that Senator Whish-Wilson was going towards—they are, the exposure of ordinary consumers to products that might not be suitable as a consequence of their inclusion in the sandbox and having regulatory relief made available to them. Other senators have talked about it in their contributions, but the consumer advocates to the Senate inquiry noted that, for example, recent innovation—as it might be termed—from payday lenders has led to more online targeting and quick loan applications for high-cost debt. It has resulted in an explosion of payday loans that originate online. That's not a particularly good consumer outcome; I would argue that's a bad consumer outcome. It is a bad product being sold to people who either shouldn't get that credit at or all or who might get it on better terms elsewhere in a more suitable product. You know, this is tightly associated with some of the things we conventionally associate with innovation—it is happening online, it is digital, it uses big data to microtarget a product to certain types of people and it is integrated with other kind of retail activities. It's certainly innovative, but it is not particularly great for consumers. One of the other examples provided by consumer advocates in the Senate inquiry process was innovation in the superannuation sector, with new entrants offering relatively high-cost options to consumers sold in a highly targeted manner online. The submission argued:

New funds … market on providing values alignment with members by investing in ethical, green, sustainable and tech related options. Fees on these new products are well above the industry average …

I guess the question is: are you satisfied with the model you are proposing, where the protections around consumer value and the best interests of consumers are not contained in the primary legislation but instead live in the regulations? You would know that we have circulated an amendment in the chamber that seeks to place that testing into the primary legislation. I'm trying to understand why government hasn't proceeded down that path.