• Robyn McDonald
Consumer Affairs

The Minister of Consumer Affairs, Hon Robyn McDonald, announced that she will seek to amend the Consumer Guarantees Act (CGA) to ensure it applies to all goods and services bought for personal or domestic use.

Her decision comes hot on the heels of a recent High Court declaratory judgment that the Act does not apply to electricity supply.

"The Government's and Parliament's clear intention was that the Act should apply to 'all goods and services bought for household use or consumption'," the Minister said, "the amendment will ensure these intentions are met."

"Creating an effective, workable amendment is not necessarily a simple matter, as there are a number of issues to be considered. My officials are preparing a report for me to take to Cabinet by the end of August. From there, we will have to find space in the legislative programme to discuss and progress the amendment.

"My officials are also consulting with various industry and consumer groups to ensure a practicable working solution can be developed.

"We must create a robust amendment that applies to all goods and services not explicitly covered by the current Act," she said, "I don't want to have to revisit this issue again."

"In the meantime, I expect anyone selling goods and services for domestic and personal use to align their codes, practices, guidelines and other domestic contract documents to the CGA.

"Companies that offer contracts that positively support the CGA may find they gain a competitive edge over companies that do not. I encourage consumers to give their approval, business and loyalty to those companies that comply," the Minister said.

The High Court declaratory judgment that the CGA does not apply to electricity supply resulted from an application by the Electricity Supply Association of New Zealand (ESANZ). ESANZ asked the High Court to rule that the Act does not apply to electricity supplied nor to line function services.

Justice Neazor agreed with ESANZ saying that electricity was not defined as goods under the Consumer Guarantees Act, although it is defined as "goods" in the Commerce Act and the Fair Trading Act. He went on to hold that line function services do not come within any of the categories of contract referred to in the definition of "service" in the Consumer Guarantees Act.