David Coleman (Banks, Liberal Party) Share this | Hansard source

Let us talk about banks and rewind to a very difficult period in Australian history, between 2010 and 2013—the Rudd-Gillard-Rudd era. We hear a lot from the opposition about banks and the evil of banks and all the things they are going to do to banks, so I went back and looked at who was actually responsible for banks between 2010 and 2013—who was the Assistant Treasurer from September 2010 to December 2011, and who was the Minister for Financial Services and Superannuation from September 2010 all the way through to the election in 2013? And who, during that time, did absolutely nothing about banks? It turns out it was the Leader of the Opposition—the Leader of the Opposition was responsible for regulating the Australian banking system for three years, during which CBA had to pay $136 million compensation over Storm Financial, NAB had to pay $115 million in relation to a class action by shareholders, a Macquarie fund manager was jailed over insider trading, and a whole range of other things happened.

I looked at what the then government did in the regulation of banks in that period, and I could not find anything substantial at all that happened in those three years. We hear them rail against the big end of town and the evils of banks, but when in power they did absolutely nothing. In contrast to them, this government is doing a huge amount when it comes to banks. Those opposite have one policy, which is to hold a royal commission, which will take years and cost hundreds of millions of dollars; they have not offered one constructive solution to any practical problem in the banking system at all. There was nothing three years ago, and there is no specific constructive policy at all today. That is a great indictment of them.

What are we doing? A lot. Firstly, those opposite had a system with three different tribunals and ombudsman services. It was very difficult for consumers—you had the Financial Ombudsman Service, the Superannuation Complaints Tribunal and also the Credit Ombudsman Service. It was really hard to navigate; it was difficult for consumers with three different bodies to go to. We say let us create one body—straightforward, simple for consumers, very low cost and able to have real teeth—to address those situations where consumers are ripped off by banks, and that is the Australian Financial Complaints Authority. It is this government that is delivering it and its introduction is going to be a very positive event for consumers.

Those opposite did absolutely nothing about executive accountability in banks. One of the things we learned in the recent House Economics Committee inquiry was that not one senior executive from any of the major banks has been terminated for any of the substantial number of incidents of poor treatment of consumers that have occurred in recent years. So not one executive suffered any consequence under those opposite, and there was no regime in place to deal with this very serious situation. So we are going to create one. We are going to create a strong executive accountability regime. We recommended a regime through our committee. It is pleasing that the government is taking such a strong action here—regulated by APRA, a register of senior banking executives, fines of up to $200 million. It is called actually doing practical things to improve the situation.

Those opposite huff and puff when interest rates change and rail against the banks, and so on. But in their time in government there was not one regulator with any focus on the issue of competition in banking. Of course, in a perfectly competitive market it is very difficult to pass on price increases because competition will make that so much harder. No regulator under those opposite ever looked into this most fundamental issue.

In the budget, the government announced that the ACCC will have $13 million of funding to focus in a very granular and laser-like fashion on the issue of competition in banking in the Australian sector. It is a very important issue. There is not enough competition in the Australian banking sector. The ACCC, for the first time, will systemically investigate this issue and put a very close lens particularly on interest rates through its mortgage residential pricing inquiry that will happen until June of next year.

How many new banks were licensed by Australian companies getting started under the previous government's six years? Zero. There was not one new bank started in Australia under the previous government, and that is a massive problem. We are changing the regulation to encourage new banks to get started. Competition is good for consumers. The more competition, the better the outcomes. This government is taking action. The Leader of the Opposition was personally responsible for this area in government. He completely failed, as did his entire team.

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