Ross Cadell (NSW, National Party) Share this | Link to this | Hansard source

Disclosure is a very important thing, and access to information is part of this parliament. One of the great privileges and the thing I enjoy most about being here is the access to information, the ability in a committee hearing to be informed by those with a finger on the pulse of industry, of the environment, of many different things.

On 16 April this year we were in the supermarket inquiry with the Woolworths CEO Brad Banducci in the stand. During the lunch break, I went up to Sky to do an interview. While there waiting to be introduced to some of the journalists, they asked: 'How did that go? What are you going to do this arvo?' I jokingly said, 'I should be shorting Coles because Woolworths sank by almost two per cent on the stock market in that first hearing morning.' I didn't think much of it at the time, but Coles did exactly the same in the afternoon—dropped almost two per cent on the stock markets from the information given at the committee hearing.

It started me thinking, so I reached out to a friend at a senior principal level in the financial markets, who desperately wants to remain unnamed—so I won't do that. I tried to recreate the trades. What would happen? How would I benefit from this information if I knew this was going to happen? Very simply, very easily, he said: 'You will put all the money on that option, on that stock. If you move a stock by a percentage of one or two per cent, suddenly it can be a multiplier.' We could look at what they did, so we recreated that trade. If I had taken $10,000 at the beginning of that day and put an option on Woolworths then floated it over to Coles, I would have turned that money into somewhere between $40,000 and $90,000 by the end of that day.

The disclosure of what we do as parliamentarians, our disclosures around our trades and the information we have really concerns me. We have to say what we've got. I sold some things, so I only have a savings account and properties now. But what are we doing with these transactions? Because I find that people will only do what they are willing to justify. I'm not saying that anyone is doing wrong but I'm saying the temptation is there. Tomorrow I'll be moving a motion for an inquiry into big box traders and retailers. I hope it's supported. No-one will know until the vote is on the floor. But the evidence I've got around some of these retailers is very, very damning. Some of that information has come out under the protection of parliamentary privilege, which we can extend for the purposes of legislation or inquiry and all these sorts of things. We hold that position dear. So it is not beyond the realm that I or someone could manipulate the markets, manipulate things for personal gain and have no reason to declare, no obligation to disclose what they've done.

I note in the USA in 2012, they put the STOCK Act through, which I think abbreviates to Stop Trading on Congressional Knowledge Act. Within 30 days, you have to disclose any transactions you have in financial markets, in stocks. I think it needs to go further. I think we need to disclose the buying or selling of any financial instruments, of futures, of options, of stocks, within a 30- to 45-day range and a scope, not the exact value but scopes of value.

If we're truly to be taken seriously that we're always doing the right things, disclosure should not hurt. If I want to go and buy a stock or sell a stock for a reason—not from here—I should be able to do it, and I should have nothing to fear from disclosing it. But if there is a pattern of behaviour—I noticed in the US they were looking at the financial collapse in a number of trades, and what happened in a lot of trades in Silicon Valley, and they looked a bit funny. They looked a bit smelly. You have to be held to account.

I would love to see a modification to our disclosure rules. There are people calling for it. Will Bennett at the Sydney Morning Herald and Sean Johnson at Open Politics are calling for a ban on the sales of stocks and the purchasing of stocks by members of parliament—I think that is too far. I know where they're coming from, but I think it's the same harm. There has to be a clearer method of tracking and a clearer method of disclosure so people can see if we are trying to manipulate the markets, if we are benefitting and if we are getting information that they do not have the time or the ability to get. Disclosure hurts no-one, it benefits everyone, and there should be more.