Surcharge ban hits an impasse - 'I don't see a scenario where it gets passed before the election'

by Mandy Te and Anna Whyte

The Government's attempt to impose a surcharge ban has hit an impasse, with ACT pulling its support and Labour not guaranteeing its support. 

The ban - expected to be in place by May - is now being described by the Commerce and Consumer Affairs Minister as being on pause. 

As to how long that would be: "How long is a piece of string?" Scott Simpson said on Thursday. 

Speaking to Interest.co.nz on Thursday, ACT leader David Seymour said the party had pulled its support and put up a counter proposal. 

"There shouldn't be a blanket ban. We know that people hate those charges, but the right thing is to say, you can charge for payWave if you offer EFTPOS and cash which are free, so long as you've got a free option."

"I don't see a scenario where it gets passed before the election."

Simpson said they wanted to do more work on the Bill. If it would be in place by May, Simpson said, "given Mr Seymour's comments today, that's looking problematic, obviously". 

"But look I'm a hopeful person, an optimistic person. 

"Many New Zealanders are being overcharged on surcharges at a time where money is tight, I think New Zealand consumers deserve a fair go."

Labour MP Megan Woods said the caucus had not made any decisions on whether to further support the ban.

The Retail Payment System (Ban on Merchant Surcharges) Amendment Bill was first announced by Simpson last July and was expected to be in place by May this year at the latest. There has been push back from business leaders and business lobby groups, even the ACT Party suggesting tweaking the proposal.

In February, there were reports the Bill had stalled.

Having the surcharge ban not go ahead this term was a huge win for retailers, Retail NZ chief executive Carolyn Young said on Thursday.

Retail NZ, the country's lobby group for retailers, has long been advocating against the Bill.

"Who knows what another government might do," she said, "but it may also mean that we can get the Commerce Commission to do the work they were originally planning on doing, which is to really do a full consultation [to] understand all of the implications and ramifications of a surcharge ban."

“Retailers have been clear that the proposed card surcharge ban would have been yet another blow to the struggling sector after a tough trading environment that has lasted several years."

Many retailers were not in a position to absorb the Merchant Service Fee, Young said, and it would have meant most stores would have needed to increase their prices to offset the added costs, which would have affected all customers regardless of how they paid.

While Retail NZ knows the Bill isn’t off the table, Young said “there could be some greater thinking about what the landscape could look like”.

Young said Retail NZ had not been in contact with Simpson recently. "He's been really clear on his position but we do have some other things that we want to talk to him about, so we'll be in touch with him shortly hoping to be able to sit down and go through some other areas."