The Commerce and Consumer Affairs Minister is not sharing the same fears as retailers over the surcharge ban.
Scott Simpson says the legislation banning surcharges like PayWave is before the Select Committee and will be in place by next year.
36 business associations have written a letter warning the ban could be passed on through increased prices.
Simpson says a lot of businesses don't use surcharges - so won't be impacted or need to raise prices.
"The ones that choose to add that pricing in will be actually competitively constrained in the marketplace by those businesses that choose not to do so."
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Episode Transcript
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Speaker 2 (00:16):
Business unhappy that the credit cards to charge ban is
going ahead. They want it to be scrapped. In an
open letter to Consumer Affairs Minister Simpson, business leaders around
the country say stopping them from passing on bank fees
will backfire. The warning the ban will mean higher prices
for all customers or more pressure on already struggling businesses.
Either way, not a great outcome. Scott Simpson's with me now, Minister,
(00:39):
Good evening.
Speaker 3 (00:40):
Gooday, Ryan, what did you.
Speaker 2 (00:41):
Make of the letter?
Speaker 3 (00:43):
Look, I understand the messages that they are sending, but
Retail New Zealand are representing their members and I'm keen
to get a good outcome for New Zealand customers and consumers.
Speaker 2 (00:57):
Okay, So that means going ahead with it? Yeah, absolutely, Okay,
so you just ignore the letter?
Speaker 3 (01:04):
Well, no, Look, listen to the views. The legislation that
will ban these pesky little surcharges is currently at Select committee.
I'm sure that Retail New Zealand will make a submission.
We'll listen to what they have to say and hear
what the Select Committee decides and then take all those
views into account before the legislation is finally passed.
Speaker 2 (01:24):
You say that businesses should pass on the savings they
get from the banking feed changes made by the ComCom.
Why not force them instead of making it optional.
Speaker 3 (01:34):
Well, by banning surchargers, we are actually forcing them to
pass on those savings. At the moment, there is no
way to guarantee that those savings that the ComCom is
going to have brought into effect by the first of
December will actually ever be passed on to customers. Currently,
New Zealanders spend about one hundred and fifty million dollars
(01:57):
a year on surcharges and ComCom estimate that up to
sixty five million of that it's actually overcharging by retailers.
Speaker 2 (02:06):
What do you I mean, what do you expect them
to do? The big problem here they're saying is they
get charge the fees. This is their way of passing
them on, otherwise they have to up the prices. Well,
I mean, what are they expected to do? What do
you expect them to do with those fees that they
have to pay.
Speaker 3 (02:21):
Well, some certainly will pass on the fees, but just remember,
as We've just said that the Commerce Commission is regulating
the price down of those bank fees, so that's coming
down on the first of December. Some businesses will add
costs into the shelf price, but many won't. In fact,
the majority of New Zealand businesses don't charge sir charges currently,
(02:43):
so the ones that choose to add that pricing in
will be actually competitively constrained in the marketplace by those
businesses that choose not to do so.
Speaker 2 (02:54):
Hey, Minister, how excited are you by Christopher Luction's leadership.
Speaker 3 (02:59):
Oh look, we're a team. I think Christopher Luxon's doing
an exceptionally good job as Prime Minister. But you know,
New Zealand's going through difficult times. It's challenging, difficult. It's
been a long, cold, wet winter and the economy is sluggish.
We all know that and we desperately want it to improve.
But I am very confident that under his leadership it will.
Speaker 2 (03:20):
Appreciate your time. Scott Simpson, Minister of Consumer Affairs and
a big backer of the Boss.
Speaker 1 (03:25):
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