Retailers welcome Productivity Commission report

Posted by Daniel Palmer on 8th May 2008

The Productivity Commission’s report into Australia’s consumer policy framework, initiated due to concerns over a lack of harmony between state and federal legislation and also to empower consumers, was released today. The report found a number of weaknesses in the current framework which were negatively impacting on both business and consumers.

Food retailers, in particular, have had difficulty with ‘regulatory roulette’, which has forced them to decide which jurisdictional requirements to comply with and which to breach. Following the report it is hoped changes will be made to legislation in order to prevent such situations from arising.

The Minister for Competition Policy and Consumer Affairs, Chris Bowen MP, welcomed the findings and indicated the Government would now attempt to address the flaws found in consumer policy framework.”This report provides a unique opportunity to examine Australia’s approach to consumer policy and ensure that the legal and regulatory framework provides the best outcomes possible for Australian consumers,” Mr Bowen said. “Consumer policy is a priority for the Rudd Government and the Productivity Commission has made a number of valuable recommendations to contribute to the way forward for consumer policy in Australia. We will consider these recommendations and, as agreed by the Council of Australian Governments (CoAG), respond formally at the end of October 2008.”

“The report highlights that across the board, there is a need for greater involvement by the Australian Government in consumer policy and law enforcement. This is a task the Rudd Government takes very seriously and it is reflected in my role as a Minister with dedicated responsibility for consumer affairs,” Mr Bowen added.

The Australian Retailers Association (ARA) were also pleased with the report labelling it as a “step in the right direction”. ARA Executive Director Richard Evans was keen to see the findings lead to a reduction in red-tape to enable business productivity to improve. “We hope this is the first step in standardising a lot of archaic state laws that impact on retailing such as retail leasing, payroll tax and the laws governing occupational health & safety, but there are a myriad other areas that could be standardised. And in this time of economic uncertainty, business needs to see the Federal Government leading to ease bureaucratic burden,” Evans said.

The report, which was based on over 250 submissions and public hearings, included six key recommendations:

* a single national generic consumer law, based on the Trade Practices Act 1974 (TPA), which would apply in all States and Territories;
* identifying unnecessary or costly consumer regulation that only applies in a few States and Territories, or to one industry, and either removing them or, if justified, introducing nationally consistent rules;
* transferring regulation of credit providers and finance brokers to the Australian Government, with the Australian Securities and Investments Commission (ASIC) as the regulator;
* national laws to tackle unfair terms in consumer contracts;
* a national approach to product safety laws and enforcement; and
* new redress and enforcement powers for consumer regulators, including the ability to seek redress for non-parties, civil pecuniary penalties, banning orders and substantiation notices.

The full report can be found on the Productivity Commission’s website.