Nick Sherry (Tasmania, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I thank Senator Coonan for her question. I think one thing that should be learnt by all, but particularly the Liberal opposition, is that correlation is not necessarily causation. At times like this Australians have every right to expect that the banks will join with the community and the government and the RBA to do everything possible to support jobs and our economy. In fact, in the face of the most volatile market conditions in some 75 years, there have been some ups and downs in bank funding costs, and this will continue for some time—for the very obvious reason of the world financial crisis, which has impacted on the world economy in a devastating way. In fact we have had the worst economic outlook in some 75 years.

The Rudd Labor government has been upfront with the Australian people about bank funding costs. We know there has been some recovery in the banks’ net interest margins in the past six months, and therefore we expect the banks, and in particular the Commonwealth Bank, which increased its rate by one tenth of a per cent, to play their part in supporting the Australian economy and Australian jobs during this global recession. Australians have every right to be furious at the selfish attitude of the Commonwealth Bank, which is hindering the efforts of the government, the Reserve Bank and the community to stimulate the economy during this global recession. When people see banks like the Commonwealth Bank reporting very healthy profits, they rightly find it hard to understand why rises are necessary and why the banks cannot afford to leave rates where they are. (Time expired)