The Senate Economics Committee has published its Report on the Consumer Credit and Corporations Legislation Amendment (Enhancements) Bill 2011.

With respect to small amount credit contracts (short term (“payday”) loans) the Committee has recommended that:

“the government review the measures… This review must re-engage with stakeholders to:

• carefully assess claims that the current provisions may have adverse consequences for consumers;
• carefully assess the merit of alternative approaches to focus the provisions on borrowers with low incomes; and
• review and publish modelling on the effect of the proposed 10 per cent, 2 per cent and 48 per cent caps on the commercial viability of the payday loan industry.”

The Committee made other recommendations in relation to the Bill’s provisions for hardship variations, reverse mortgages, remedies for
‘unfair or dishonest conduct’ and consumer leases.