tmmonline.nz  |   landlords.co.nz        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, May 17th, 6:37PM

Mortgages

rss
Latest Headlines

New commerce minister blames industry for CCCFA

The new minister of Commerce and Consumer Affairs thinks the finance industry must share responsibility for problems with the Credit Contracts and Consumer Finance Act (CCCFA).

Friday, February 3rd 2023, 7:03PM 7 Comments

by Eric Frykberg

 


He says the finance sector did not engage sufficiently with the government to make sure the law would work well.

The CCCFA has been widely accused of smothering the lending industry in red tape, and a process of reforming it began within two months of it being passed.

A first tranche of reforms reduced the need for detailed analysis of spending patterns such as consumption of cups of coffee. A second tranche is due out soon.

The minister who pushed this through, David Clark, has been removed from cabinet. His replacement is a former law professor and second term MP Duncan Webb.

Webb defended the CCCFA, even if it had its faults.

“It was a first cut, it wasn't perfect....but the philosophy is absolutely right, that lenders don't just provide good information, but they act fairly and appropriately, and take into account the interests of borrowers,” Webb said.

It was then put to him that any law that needed to be reformed within a matter of months must have been a dog in the first place.

“What it indicates is that the finance sector wasn't prepared to move with the times,” he replied.

“It's a pity that we didn't have great engagement in that regard, because we would have come out with a better and more workable system.

“We wouldn't be revising it if we had a finance sector that was more prepared to follow international best practice.”

Questioned further about this, Webb said he wasn't “laying blame” and he accepted that the first part of the law “didn't work.

“It's the government's job to get it right.....but I am very open to free and open discussions about achieving the policy which includes making sure that borrowers are protected from poor lending practices.”

Financial Service Federation chief executive Lyn McMorran said her members strongly agreed with the need to protect vulnerable borrowers.
And she was grateful that Webb had accepted a request for a meeting with her sector.

But it was wrong to say that the sector had not engaged with the government earlier.

“When it comes to engagement, we engaged all the way through, with officials and with the minister himself whenever we could get to see him.

“We always came with the view that vulnerable borrowers needed protection....but what was required was not a law with more prescriptive regulations but enforcement of the law that already existed.

“All of the things that we said would happen (such as blocked credit for solvent people) were not unintended consequences, they were spelled out by the industry right from the start.

“We were engaging but no-one was listening.”

The New Zealand Banking Association also insisted it had been closely involved in the establishment of the CCCFA rules.

“The banking industry has engaged with the current CCCFA reforms every step of the way,” chief executive Roger Beaumont said.

“(This included) submissions to the government and parliament since 2018, and it regularly engaged with MBIE officials and ministers during that time.

“The banking industry specifically warned the government and regulators about the unintended consequences of the regulations.”

Tags: CCCFA

« Financial advisers told not to rush on CPD creditsResimac says its new fixed rates offer relief for specialist borrowers »

Special Offers

Comments from our readers

On 4 February 2023 at 8:47 am Jonny Good Guy said:
Always woking to protect the 5% losers in NZ , never the 95% winners, NZ is a shocking place now
This needs to be reversed, there will always be people who get their life wrong, SO
95% work on them first
On 4 February 2023 at 10:19 am w k said:
in summary, the law requires: if someone can't read the time on the clock, you've got to explain how the clock works.
On 4 February 2023 at 1:18 pm NZMA said:
First off the article is titled, "New commerce minister blames industry for CCCFA", while "Questioned further about this, Webb said he wasn't “laying blame”... so which is it?

Secondly, there was no engagement at all with Mortgage Advisers who are at the coalface, who almost universally pegged these changes as a bad idea and even petitioned against it.

There should have been some middle ground and working with the adviser industry would have helped. But they never seeked any engagement from those at the coalface, so what did they expect?
On 4 February 2023 at 2:18 pm w k said:
@NZMA: reading in between the lines, in other words he's saying "heads i win, tail you lose".
On 7 February 2023 at 9:00 am Bikedude said:
Oh yaaay, more delusion. First Faafoii, now this guy. Roll on October.
On 7 February 2023 at 9:55 am KiwiInvestor said:
The comments from the MP just highlight the arrogance of this government! They 'think' they know best, so will do as they please. To hell with talking to the industry experts who have to actually work with the legislation on a daily basis! Now the question is, with a change in government (fingers crossed), will the new government repeal this law?
On 7 February 2023 at 1:09 pm Amused said:
So as usual with this Government ideology replaces common sense. What has transpired before gets re-written now to suit the desired narrative. Fortunately though advisers have long memories and so do the voters!

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 ▼6.39
ANZ 8.64 7.74 7.39 7.25
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 7.14 6.79 6.65
ASB Bank 8.64 7.14 6.75 ▼6.39
ASB Better Homes Top Up - - - 1.00
Avanti Finance 9.15 - - -
Basecorp Finance 9.60 - - -
Bluestone 9.24 - - -
Lender Flt 1yr 2yr 3yr
BNZ - Classic - ▼7.14 6.79 6.65
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 ▼7.74 7.39 7.25
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - ▼6.79 - -
Co-operative Bank - Owner Occ 8.40 ▼6.99 6.79 6.65
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 ▼7.49 7.29 7.15
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 6.89 6.55 6.35
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 ▼6.69 6.59
Lender Flt 1yr 2yr 3yr
Kainga Ora 8.64 7.79 7.39 7.25
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 ▼7.99 7.79 7.55
Kiwibank - Offset 8.50 - - -
Kiwibank Special - ▼6.99 6.79 6.65
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 9.00 7.75 7.35 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
Resimac - LVR < 80% 8.84 8.09 7.59 7.29
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.09 8.59 8.29
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 ▼7.74 7.29 6.59
SBS Bank Special - ▼7.14 6.69 5.99
SBS Construction lending for FHB - - - -
SBS FirstHome Combo 6.19 ▼6.14 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.95 - - -
Select Home Loans 9.24 - - -
TSB Bank 9.44 7.79 7.55 7.45
Lender Flt 1yr 2yr 3yr
TSB Special 8.64 6.99 6.75 6.65
Unity 8.64 6.99 6.79 -
Unity First Home Buyer special - 6.55 6.45 -
Wairarapa Building Society 8.60 6.95 6.85 -
Westpac 8.64 7.89 7.35 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.75 6.65
Median 8.64 7.21 7.29 6.65

Last updated: 17 May 2024 9:41am

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox  |  Disclaimer
 
Site by Web Developer and eyelovedesign.com