This article by me was first published in Retail Banking Review here.

I’ve commented previously that media releases are not law. A law isn’t a law until it is passed by Parliament and for Commonwealth law, that means the Senate as well as the House of Representatives.

Not knowing if, when and in what form a law will be passed makes it hard to plan changes to documents, processes, pricing and software.

Much has been said lately about the Commonwealth Government’s “backflips” on its announced laws so it’s worthwhile looking at the status of its announcements affecting retail banking regulation.

Whether the changes are because of negotiations with industry or as a concession that the law won’t get through the Senate, they need to be factored in to forward business planning.

Some changes are proposed in stages but the second stage reforms won’t be announced until the first stage is completed, for example privacy and data breaches.

Other changes are proposed for 3 years’ time. They assume the current government will still be there or that a new government will agree with the changes.

In recent weeks the Government has abandoned the Emissions Trading Scheme and dropped business phone numbers from eligibility for listing in the Do Not Call Register.

The Government’s Henry Tax Review response of 2 May turned out to be an anti-climax: even though it has important changes for superannuation and company tax (assuming the Resources Super Profits Tax is passed), the opportunity to also make compliance improvements has been deferred. Perhaps they will be announced in the Budget on 11 May.

The Future of Financial Advice reform package will have a significant impact on financial institutions and planners if it is implemented in its current form.

Here’s a timetable of changes based on current announcements and laws as passed:

1 July 2010

• Australian Consumer Law – unfair contract terms law commences
• National Credit Code commences;
• Suitability assessments required for loans by lenders which are not ADI’s or Registered Finance Corporations
• Applications for Australian Credit Licences open for existing consumer lenders (applications close 31 December 2010)

Second half of 2010 (likely)

• Bankruptcy amendment increasing the minimum amount for which a creditor can petition for bankruptcy from $2,000 to $10,000
• Extension of Do Not Call Register to emergency service, fax, other non-business and government numbers. Australian business phone numbers will not be covered by the Register.
• Phase 2 Consumer Credit reform to commence: including a review of credit card limit extension offers, the provision of credit for small businesses, regulation of investment loans other than margin loans and mortgages for residential investment properties and enhancements to the regulation and tailored disclosure of reverse mortgages.

1 January 2011

• Responsible lending starts for all lenders (including ADI’s and registered finance corporations) starts.
• Margin lender licensing transition period ends
• Commencement of new privacy credit reporting laws: reporting will be allowed for repayment history information from 14 April 2010.
• introduction of a Paid Parental Leave scheme.
• Changes to ASX Corporate Governance Principles and Recommendations commence covering reporting on board diversity and executive remuneration
• Small business unfair dismissal rules will only apply to businesses with less than 15 employees by individual head count (as opposed to less than 15 full time equivalent employees until then). Employees of a small business will only be able to claim for unfair dismissal after they have been employed for at least 12 months. To dismiss someone fairly after 12 months the employer will have to comply with a Fair Dismissal Code for Small Business.
• Australian Consumer Law Stage 2: includes a new national legislative scheme for consumer product safety

May 2011

• New Personal Property Securities law commences.

First half 2011

• A new national business names registration system
• mandatory data breach notification decision likely

1 July 2012
Financial adviser commission reforms begin.

2013
Superannuation and company tax reforms commence.