Labour is promising a new Fair Go law to ban hidden fees and “junk” insurance products it says are pushing whānau further into debt.
Leader Chris Hipkins and Manurewa MP Arena Williams announced the policy at Māngere Budgeting Services Trust in South Auckland.
“New Zealanders are being fleeced of their money, and the Government can do something about that,” Hipkins said.
“Businesses should be making money by providing valuable products and services, not by tricking people out of their money.”
If elected, Labour would require businesses to disclose the full price of products and services upfront.
The policy would ban some insurance products sold with vehicles, prohibit secret commissions and require sellers to show the total cost of a vehicle and its finance over the life of the agreement.
Williams said whānau had entered dealerships expecting to spend between $13,000 and $15,000 on a basic vehicle, only to face repayments exceeding $50,000.
“You can no longer sell junk insurance, and the fees that are going to add on over time have to make sense,” she said.
“They have to be advertised clearly at the start so whānau can compare and contrast and get the best deal.”
The proposed law would also target hidden charges on gym memberships, phone and internet contracts, subscriptions, and ticket sales. Businesses would have to make subscriptions as easy to cancel as they are to sign up for.
The 2024 New Zealand Consumer Survey found Māori were more likely than average to report being deceived by overseas-based businesses, at 22 per cent, or New Zealand businesses, at 16 per cent. Pacific respondents were also more likely to report deception by overseas businesses, at 23 per cent.
Māngere Budgeting Services Trust’s Lara Dolan welcomed the proposal.
“Any policy that’s going to reduce the level of debt people get themselves into is a step in the right direction,” Dolan said.
“Our service will be here regardless of government and regardless of political association.”
