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The cornerstones of consumer rights

Safety, information, choice and a voice.

hand with dollar sign
Last updated: 01 September 2020

Few people in Australia realise that consumer rights – the theme of this edition of CHOICE – owe much to former US President John F Kennedy.

On 15 March 1962, in a speech to the US Congress, JFK called for legislation to protect four fundamental consumer rights: the right to safety, the right to be informed, the right to choose and the right to be heard.

These principles, which came to be known as the Consumer Bill of Rights, might sound like common sense but when JFK enunciated them, he became the first leader of a major economy to recognise that when we buy goods and services, we should not be at the mercy of the market. Government should ensure that we aren't placed in danger or ripped off.

More importantly, he acknowledged that the system needs to be built around consumers. The right to choose means that governments need to ensure that markets are competitive, not monopolies or duopolies, and the right to be heard means that governments and businesses need to provide for complaints to be heard and resolved.

This speech came at a tipping point around the globe. Consumer organisations like ours were springing up in developed economies, and the 1960s and 1970s would see a wave of regulation to protect consumers from misleading advertising, unsafe products and predatory lending in countries including Australia.

The risk of predatory business practices is even greater in a recession and consumers need regulators to be proactive

How you see our progress as a nation since then is a matter of perspective – either we've continued to improve our laws to ensure that people are better protected, or we've failed, because there is still so much to be done. I take more of a glass half full view, because that's the nature of progress. You never finish the job.

While we'd argue that reform must progress faster in an economic crisis such as the one we're now facing, not everyone agrees. As we're already seeing, business groups miss no opportunity to argue that regulation is a burden on the economy and that the solution is a war on "red tape". In reality, the risk of predatory business practices is even greater in a recession, and consumers need regulators to be proactive and armed with strong powers.

As JFK said:

"If consumers are offered inferior products, if prices are exorbitant, if drugs are unsafe or worthless, if the consumer is unable to choose on an informed basis, then his dollar is wasted, his health and safety may be threatened, and the national interest suffers."

While some of the language looks a bit dated, the concepts hold true today. It's important that our governments remember this in the months ahead.