Jenny McAllister (NSW, Australian Labor Party, Shadow Assistant Minister for Families and Communities) Share this | Hansard source

We've come to the end of a royal commission that the current Prime Minister and former Treasurer, Mr Morrison, voted 26 times to prevent. It's an understatement to say Mr Morrison was dragged kicking and screaming to this commission. When the former Prime Minister, Mr Turnbull, folded to public pressure and announced the government would finally establish a royal commission, the then Treasurer could not have looked more despondent. He described it as a 'regrettable but necessary action' only taken because 'politics is doing damage to our banking and financial system'. Let's reflect on that a little bit more. It was politics, he asserted, doing damage to our banking and financial system. Those words haven't really aged well, have they? The evidence unearthed by the royal commission is shocking, and it has shown that the royal commission was about much more than responding to political concerns. It was about exposing serious systemic deficiencies. Even the head of the Australian Banking Association has admitted:

Suffice to say that it is in everyone's interest that we build a better banking system. And that as painful as the process has been, sunlight is the best disinfectant.

It might have been better had Mr Morrison heeded those ideas a little earlier.

It's worth contemplating exactly what it meant for Mr Morrison, as Treasurer, and all of his colleagues, to vote 26 times against the establishment of this commission. These are the things that the Prime Minister voted 26 times to hide. These are the scandals, the issues and the problems in the sector that the Prime Minister thought should never be exposed to sunlight. There were multiple institutions charging fees for providing advice to people who had died. There were the financial planners from the Commonwealth Bank subsidiary Count Financial. There were the NAB superannuation services that charged more than 4,000 dead customers. There was AMP deducting life insurance premiums from the superannuation accounts of more than 4,000 dead people. It's just shameful and, in fact, shameless.

The commission also exposed the aggressive sales culture that took advantage of vulnerable people. The commission heard a now infamous and harrowing recording of a phone call in which a young man with Down syndrome was cold-called and aggressively sold life insurance. When his father tried to cancel the policy on behalf of his son, staff belittled the family in internal messages, and one message referred to that man as a 'bloody whinger'. It was part of a culture that incentivised sales over everything else. There was evidence of luxury overseas holidays handed out as incentives to salespeople, and those incentives were at the heart of the culture of greed that drove these abhorrent and immoral behaviours.

There were the aggressive claims-handling processes by insurance companies to avoid payouts. CommInsure rejected a woman's claim for treatment for breast cancer because the surgery wasn't radical enough. Another insurer, TAL, hired a private investigator who filmed a nurse in her home and in her pool to fight her claim for income protection arising from an anxiety disorder.

The commission also heard about the irresponsible provision of credit. There were stories from people who had received credit card increases after confessing to their banks that they had a gambling problem and asking their banks to cut them off. It comes on top of the routine underestimation of customers' living and other expenses, including the use of benchmarks like the Henderson poverty index, which is in no way a way to undertake assessments in relation to responsible lending obligations.

All of these things came to light through the work of the commission. These are all the things that Mr Morrison and all of his colleagues sought to hide over and over again in their refusal to support a royal commission. What did the commissioner say about all of this behaviour? He said:

First, in almost every case, the conduct in issue was driven not only by the relevant entity's pursuit of profit but also by individuals' pursuit of gain … Providing a service to customers was relegated to second place. Sales became all important. Those who dealt with customers became sellers. And the confusion of roles extended well beyond frontline service staff. Advisers became sellers and sellers became advisers.

…   …   …

Rewarding misconduct is wrong. Yet incentive, bonus and commission schemes throughout the financial services industry have measured sales and profit, but not compliance with the law and proper standards … rewards have been paid, regardless of whether the sale was made, or profit derived, in accordance with law. Rewards have been paid regardless of whether the person rewarded should have done what they did.

Why did they act this way? The commissioner was very clear: because they could.

It was damning evidence and damning commentary, but the royal commission has now run its course. The evidence, the findings and the recommendations are in the public domain, and it is now the responsibility of the parliament and the government to act. The government is shirking its responsibilities. We've heard from the Manager of Government Business in the House that the issues arising from the royal commission won't be dealt with until after the election. This part-time government, barely sitting in the first half of this year, cannot make time, it appears, to deal with the recommendations in the report. The Prime Minister and his cabinet have lined up to say that the issues are very complex and they need to take the time to work through them.

Well, maybe some other government, some other government with a different track record, some other government with a different frontbench, could get away with saying this. But does any Australian, anyone out there, really think that this government and this Prime Minister really want to take their time for this purpose? Are they really taking time because they want to do the hard work and get the policy settings right? No, they don't. No-one believes anything they say when it comes to banking. They have no credibility, after spending more than a year using every trick in the book to avoid the royal commission being started. Once it did start, they continued to disparage it. They continued to say that it wasn't important. The then Treasurer, now Prime Minister, said in April last year:

Other agencies certainly have addressed many issues being raised. I think that will more directly impact on the public consciousness of these things, but they are not things that the government was not aware of.

Why didn't the government do something about it, if they knew all about it? Everything about their behaviour suggests that they just don't care. Does any Australian really believe that this government has now seen the light and is beavering away so that if it's re-elected, once the public pressure is off, it can introduce a comprehensive set of reforms? Or is it more likely that the government's delay, its refusal to schedule more parliamentary time to deal with these things, is just another attempt in a very long list to delay action?

We've seen it before when the government takes its time to get it right on financial services protections. It's been reported that the Assistant Treasurer, Mr Robert, got emotional in the other place today describing his experiences with the banks. Maybe he should spare a thought for the families whose lives have been turned upside down on his watch by the actions of unscrupulous payday lenders and consumer lease operators. For more than two years the government has been sitting on clear recommendations to amend the SACC legislation, to put in place protections for vulnerable Australians who have been charged outrageous amounts of interests by predatory lenders. It's been more than a year since the government released an exposure draft of legislation that would respond to those allegations. But it has disappeared into the moor of chaos and indifference on the other side. Nothing is being done to support these very low-income people. Nothing is being done to rein in scandalous behaviour in that sector.

The government cannot be trusted to act on financial services reform. They have not acted on the payday lenders, despite saying that they would. Is there any reason for anyone to believe that they will act on these recommendations? Why should we give them the chance? Time and time again they've been presented with an opportunity to make change and they have failed that test. In fact, one of the first things they did upon attaining power was to seek to wind back the FOFA reforms. Their first priority when coming to government was to remove protections for consumers. Every fibre of their being sees every problem in the banking sector through the perspective of the banks and the financial services sector. So many of their people are drawn from that sector that they are unable to see these things through the lens of the consumers. They cannot be trusted to act on financial services reform unless their feet are held to the fire. History repeats itself: delay on SACC; delay on response to the royal commission. Australians deserve a great deal better than what they're getting.