6 January 2019
SUBJECTS: Banking Royal Commission
JOURNALIST: I noticed nobody suggested we could build a bank there. They’re not particularly popular at the moment, the banks, the Big Four, albeit as our listeners have been telling us, many brokers among them, they’re feeling like they’re the ones that copped it hardest in the Royal Commission report. That’s what we’re going to talk about now in Two Tribes with Chris Pyne and Anthony Albanese. Good morning to you both.
CHRISTOPHER PYNE: Good morning, gentlemen.
ANTHONY ALBANESE: Good morning, and can I say as the Tourism Shadow Minister, I think roof climbs are sensational.
JOURNALIST: yeah good on you, Albo. We love it.
ANTHONY ALBANESE: I’m backing it in. I’m backing in Adelaide from Perth.
CHRISTOPHER PYNE: I don’t want to do it, but I think it’s great.
JOURNALIST: You and Albo could do it together Chris.
CHRISTOPHER PYNE: Have you done it Albo?
ANTHONY ALBANESE: I’ve done it – it’s terrific.
CHRISTOPHER PYNE: When we do it together you can come without a brace. But I’ll look after you, I promise.
ANTHONY ALBANESE: As long your hands are handcuffed.
JOURNALIST: Hey Chris, we’ll start with you. How does the Government kill off the very strong perception that you were dragged kicking and screaming to this Royal Commission?
CHRISTOPHER PYNE: Well it’s old news to start with. What the public are interested in is not political commentary from within the bubble here in Canberra. It’s actually what we’re doing. What we’re doing is responding to every one of the 76 recommendations and toughening up our treatment of the banks, directors, superannuation, protecting consumers, giving more power to regulators and courts, and there’s legislation in the Senate right now, to protect consumers in superannuation, that Labor won’t support because they’re conflicted by their union controlled industry super funds. Now, we’re getting on with it. Whether we took a long time to come to the Royal Commission or not, it doesn’t really matter. We set up the Royal Commission. We’re responding to the recommendations, and we’ve had five years of toughening up the financial services sector. When Bill Shorten was the Minister for Financial Services, which he was by the way, he did nothing about any of these things that had happened.
JOURNALIST: Albo, there’s a point of difference between you guys and the Government, and I think it’s on the 75th recommendation of the report, as it pertains to how brokers are paid fees, mortgage brokers are paid fees, previously by the banks, in the future will be by the people, like David and I, and everyone listening, you guys, who want to get a loan, you pay the broker direct. We’ve been contacted by so many brokers this morning, saying that if that happens, there’s 20,000 of them, they’re all going to be out of work. Is it still your intention to adopt that recommendation wholeheartedly or has some of the concern and blowback from brokers given you pause?
ANTHONY ALBANESE: Well what we’ve said is that we’ll adopt in principle, the recommendations. Obviously, we’ll look at the detail. We want to make sure that there are good outcomes from a Royal Commission, after all, that we put forward 26 times, and the Government voted against 26 times. I do sometimes think that Christopher occasionally takes your breath away with the capacity to argue black as white. As they opposed all of this, the Parliament isn’t sitting, so they won’t be able to do anything before Parliament gets up because we’ve only been sitting for ten days. We want to actually get recommendations put into legislative form and put it through the Parliament, prior to the election. And that’s why we’ve said the Parliament should sit more.
CHRISTOPHER PYNE: Well Labor should vote for the legislation that’s in the Senate this week coming up, and we’d be able to reform superannuation next week, but you’re not going to do it.
ANTHONY ALBANESE: I’ll give you the very big tip, Christopher. That legislation passed the House of Representatives some eight months ago, and you haven’t even brought it on for debate in the Senate in those eight months.
CHRISTOPHER PYNE: Because Labor won’t support it. You’ve said you won’t support it.
ANTHONY ALBANESE: You’ve got to actually have a debate and a vote. What we’ve said is –
CHRISTOPHER PYNE: So what you’re saying is you will support it?
ANTHONY ALBANESE: What we’ve said is, we will improve the legislation because at the moment, well that’s the way it works in a democracy. What we have is a legislation, we have debate in the Senate, the house of review, we have amendments put, it’s carried, or not, but determined by the Senate and comes back to the House of Reps.
JOURNALIST: Setting that aside, I think the number one question that our listeners want answered, and we’ve seen the banks’ share value soaring yesterday. There seems to be, they’re almost sort of giggling down their Stella Artois down in Martin Place, going “That wasn’t as bad as we thought it was going to be”. How is the Government, and the Government of any hue, going to make sure that this crap doesn’t happen again?
CHRISTOPHER PYNE: Well I heard Graham Samuel this morning on another network, which I won’t name, who made a very good point, and Graham Samuel used to be the head of the ACCC, and we appointed him to do a review of the powers of APRA, the Australian Prudential Regulation Authority, to make sure that it has the powers it needs, and the capability it needs, primarily to actually enforce the law. He said that the market had completely overreacted to what they thought the royal commission was going to recommend and so there’d been a flight out of the banks from the stock market and so then yesterday’s reaction was a counter swing back to one of relief that, sure, the recommendations are tough, and the Government is adopting them and getting on with the job. We’re taking action on all 76, but we’re not going to force a credit squeeze. We’re not going to ruin the economy, and this is the problem with Labor. Labor doesn’t know how to run an economy. If Labor gets in, there will be a credit squeeze.
JOURNALIST: But Chris, that’s the market –
ANTHONY ALBANESE: …Financial crisis, Christopher.
JOURNALIST: It’s the market analysis and the political analysis. But the real time where the rubber hits the road analysis that I think people want, is the NAB going to get away with making $100 million out of fee for no service, and are they going to continue with this culture of bonuses driven by, not the standard of service that they provide but purely how many mortgages they can sell. How are you going to make sure that the regulator isn’t such a soft touch? How are you going to make that happen right now, not years from now?
CHRISTOPHER PYNE: Well Kenneth Hayne has recommended criminal charges against certain individuals so that will go through the proper processes and they, we will adopt the actions that need to be done to make sure that justice is not only seen to be done, but actually achieved. We are toughening up the powers of the regulators. We think that some of the regulators have been underwhelming, and ASIC was singled out by the Royal Commission. We’re going to toughen up their capabilities to make sure that this can never happen again. So we didn’t bring about this bank scandal, but we are the ones fixing it, and that’s what the public want to see. We’re getting on with it. We’re going to give people the chance to seek compensation going back ten years, which was the period of the Royal Commission under the Australian Financial Complaints Authority, which we established, by the way. So we certainly haven’t been sitting on our hands. We’ve been responding to the criticisms of the banks, but we also have to remember that the banks are an important foundation of our economic security in this country. They’re four, four of the ten largest banks in the world, our most profitable banks in the world, four of them are the big four, and we need to make sure that we don’t cause a crisis in banking, which Labor would do if there was a credit squeeze.
ANTHONY ALBANESE: Well that is absolute nonsense. Christopher speaks about not delaying it. That they delayed the Royal Commission, and it should have been called years ago. We went to the 2016 election with a policy of having a royal commission in the banks. Christopher says that the big four are amongst the most, ten most profitable banks in the world. He’s right, but some of that is at the expense of ordinary consumers being ripped off by behaviour that’s unethical, immoral and in some cases, according to Commissioner Hayne, illegal. Now if he is serious at all, let’s end the delay. Let’s have Parliament sit. We’re sitting for the next two weeks, let’s keep going, until this legislation gets done, arising out of the Royal Commission.
JOURNALIST: Christopher Pyne?
ANTHONY ALBANESE: And Christopher is the Leader of the House.
JOURNALIST: It’s a debate that’s going to continue until election. Chris Pyne, Anthony Albanese, thanks for joining us. I think you saw there folks from the last five minutes is a microcosm of the exact debate that is going to dominate the election in a few months’ time.