Question Period: Payday Loans – February 13, 2015
Mr. Coon: One of the things that I have discovered about this Legislative Assembly is that, while it passes many, many bills to address problems and challenges, a surprising number are never proclaimed and never implemented.
A glaring example is An Act Respecting Payday Loans, which was given royal assent on April 30, 2008, and amended just last year, but still not proclaimed.
My question is for the Minister of Justice. Is he aware that the legislation designed to protect the working poor from being charged criminal rates of interest by payday loan companies has been in legislative purgatory for the last seven years?
Hon. Mr. Horsman: I will answer this as the Minister of Justice, if I may. First, I want to thank the MLA for Fredericton South for this important question. As he is no doubt aware, the issue of payday loans falls under the Financial and Consumer Services Commission. The timing of this question is great because the commission is currently looking for comments from the public on the proposed rules surrounding interest rates and other costs associated with this type of service. The period that is for comments, for people to send in their reports, started on January 30 and will continue until March 31. Our government will continue to work closely with the commission to ensure that consumers are protected and that they are charged a fair interest rate and other fees when they use the service of payday loans and so on.
I would also encourage the members opposite and all New Brunswickers who use this type of service to share their thoughts on the proposed maximum interest rates and other fees with the commission. The information is available on the commission’s . . .
Mr. Speaker: Time, minister.
Mr. Coon: In New Brunswick, there are at least 27 payday loan outlets, with 11 of them in the city of Saint John alone. Interest rates can exceed 500% on an annual basis. As a result, the working poor sometimes find themselves trapped, forced to take out payday loans from one company to pay another payday loan company, from which they received an earlier loan. Manitoba limits the cost of borrowing to 17%, or $17 for every $100 borrowed.
Will the minister ensure that our payday loan legislation is implemented when the Financial and Consumer Services Commission has completed its consultations on March 31 of this year so an immediate end can be put to the exploitation of the working poor by these usurious lending practices?
Hon. Mr. Horsman: As I stated—I was cut off, and I am sorry, I ran out of time—I would encourage the members opposite and New Brunswickers who use this type of service to share their thoughts on proposed maximum interest rates and other fees with the commission. The information is available on the commission’s Web site, and I would be more than happy to provide the member opposite with the link to the site.
It is true that people are living paycheque to paycheque. That is why it is this government’s intention, as one of the pillars of our platform, to create jobs, to adhere to our fiscal responsibilities, and to help families get those jobs so that they do not have to use these institutions. Again . . .
Mr. Coon: While the Financial and Consumer Services Commission is completing its public consultations on payday loan fees and rates, there are New Brunswickers who are sinking deeper and deeper into the financial quicksand of borrowing from these payday loan companies. Will the Premier—the Premier—provide these New Brunswickers with a way out of this financial quagmire, which they would have avoided if An Act Respecting Payday Loans had actually been proclaimed seven years ago?
Hon. Mr. Horsman: I want to thank the member for Fredericton South. It is a concern to the people of this province and the families who live paycheque to paycheque. I want to reiterate to the member opposite that this is what we on the Liberal side of the House are trying to accomplish. We are trying to create jobs so that people do not have to use these institutions or live paycheque to paycheque, paying one cheque with another cheque.
Again, I want to reassure the people of this province that we are looking into it. As I stated before, there is a Web site where they can list their concerns. It started on January 30, and it will continue until March 31. They can go on the Web site to issue their concerns so that we can help the families of New Brunswick. Thank you.