“Five months since I wrote to the Finance and Expenditure Committee requesting an inquiry in to the effects of the CCCFA changes into lending, the Government has still not solved the problem,” says ACT Leader David Seymour.

“People in the industry tell me the problem is ongoing, so the changes proposed here will be the first relief. By the look of it, these changes will make only minor differences for people struggling to get credit in a slowing economy.

“The Government’s proposals still make Bank Directors liable for any borrower experiencing hardship, according to the Act’s standards. Those standards are still undetermined, and those liabilities, which are personal, remain extreme at $200,000 per director per loan.

“The rules are in essence the same. The principle has not changed, these are only changes in degree. For example, there will be more guidance as to which lenders are ‘obviously’ not in hardship, but the lender still has to make the call, and hope the courts agree they got it right.

“Doing the same thing will give us the same result we’ve had. In this environment of continuing uncertainty and asymmetrical responsibility, ACT predicts there will continue to be frustrations and delays in lending market. Worst of all, these frustrations and delays among bank customers will not make a jot of difference when it comes to protecting the truly vulnerable from loan sharks.

“What the Government should have done is recognised the law was not necessary and dumped the penalties on directors. That would have removed the teeth from the law. They then should have reviewed whether the provisions to tackle actual loan sharks have succeeded and go forward from there.”