Will there be a banking inquiry?

Ross Greenwood speaks to Treasurer Scott Morrison about why the Prime Minister cancelled next week’s sitting of parliament and mounting pressure from people from within his own party to  create a commission of inquiry into the banks.

Introduction: Will there be a banking inquiry?

Ross Greenwood: As I told you earlier, the federal government has canceled a sitting week in the House of Representatives to allow the Senate to finish debating the same-sex marriage bill. Let’s now go to a man who’ll be very much involved in all of this. But some are suggesting that it’s actually to try and delay Parliament with the numbers going against the government right now, to avoid having a bill to have a commission of inquiry into our banks to be put through the Senate and into the House of Representatives.

Let’s go to our federal treasurer Scott Morrison, who is on the line right now. Many thanks for your time treasurer.

Interview with: Scott Morrison, Treasurer

Scott Morrison: Hi, Ross.

Ross Greenwood: In regards to the summoning Bill Shorten today, basically says that the government’s chicken. That you know that it’s likely you’ll get some form of legislation up for a commission of inquiry into the banks that you don’t want to face this while the numbers are against you. Is there the validity and what he’s saying?

Scott Morrison: No, I mean, Bill Shorten as usual is just a self-serving troublemaker. For that to occur, the Senate would have had to have at first actually passed a commission of inquiry which they wouldn’t be able to do because they’re focusing on the same-sex marriage legislation. He’s got the whole thing upside down.

What we’ve decided to do is what we promised the Australian people we would do. First of all, the sitting has only been postponed a week. It’s not being cancelled. It’s been pushed back a week. We can sit those two weeks if that’s what’s necessary. We said we would have a plebiscite and then we would act on the results of that plebiscite. The Senate has the first go at that. They’ve already had the bill introduced into the Senate. They’ll work through the amendments next week, that will come to us. We can focus on getting that done and dealing with the citizenship issues. That’s just the Parliament doing its job. Bill Shorten is just having a big shock.

Ross Greenwood: I spoke to the national senator Barry O’Sullivan last week. He’s one who’s adamant that there should be some form of banking inquiry. Here is what Barry O’Sullivan told me last week.

Barry O’Sullivan: It is so long overdue. I’ve heard the comments of the treasurer and the finance minister. They need to be careful indicating that the government wouldn’t fund an inquiry, even if both houses of the parliament were to recommend it. That would be a fatal blow for the government of the day without question.

Ross Greenwood: A fatal blow. He says you’ve got to listen carefully. Would it be a situation where the government would be prepared to fund it if there were as indeed a majority in both houses of parliament?

Scott Morrison: Well, I don’t think people should get ahead of themselves. The Parliament next week will be dealing with enacting the same-sex marriage legislation in the Senate. Then that bill coming down to the house. That’s what will happen next week. In the following week in the Senate, they may well or may not, whatever the Senate wishes to do. We’ve got bills that we’d like them to pass to give first time savers tax cut. I think that’s pretty important. I’d like to see that get some priority. There are a range of bills that are jacked up there in the Senate which they need to work through which is for the good government of Australia.

Now, we’re getting on with the job of taking action now on issues in the banks and everything from the executive accountability regime. We had the bank levy earlier in the EM. We’ve got the complaints tribunal which actually gives people access to outcomes when they have complaints with banks. They could pass that next week as well. So, there’s plenty of things for them to do. Including taking action on the banks with legislation the government is asking them to support. That’s what’s necessary–

Ross Greenwood: You’d appreciate there is a mood for some form of inquiry now. As even say for example, Barry O’Sullivan says, it’s not a Royal Commission, it’s a commission of inquiry that would report to the Parliament. Now, you’ve also got say for example, George Christensen in the House of Representatives. He’s actually given a pledge not to cross the floor while Barnaby Joyce is out of the house. But he’s also said on December 4, the day that the Parliament would now sit the House of Representatives. That’ll be the day that he could cause political damage. Again he says, it’s all about the commission of inquiry into the banks.

Scott Morrison: Well, the Parliament will take its course. I’d like anyone else to respect the Parliament. I’m a member of the Parliament, but I don’t think it’s the job of Parliament to being destructive forces or anything like that. I’m sure that it’s not George’s intent to be a destructive force in the Parliament. I think he would work with his colleagues and seek to do what’s in the best interests of all Australians.

Look, we will just work through this in a careful and measured and patient way. And keep getting on with the job of the things I just talked about. The issue of a commission of inquiry, well, if the Senate passes– Senate’s already passed the motion and bill on a commission of inquiry. That happened some time ago. That wouldn’t be a first.

It’s not the first time that Barry’s expressed these concerns, but will continue taking action and getting things done now, which means that we can get access to people getting resolution to this matters. But also setting up the disciplines that need to be there to ensure that our banking system is there, that it’s accountable. That it’s competitive and we’ve spoken about that before Ross, with comprehensive credit reporting and opening up to mutuals and cooperatives and so on. Making sure that they can get a look in. But the best thing we can do for people dealing with the banks who want to buy a home in the Senate, is we can pass the tax cut bill for the first time deposit savers.

Ross Greenwood: It still comes back to the Parliament because there’s so much of the timing involved here. Say for example, by pushing the Parliament back by that one week. Effectively now, the members having to get their documentation ready to prove their citizenship that gets pushed back to December 5, 8:00 PM. It leaves only two days for referrals to the High Court. They could be by December 5, one day after the Parliament reconvenes. They could be a whole bunch of other members of our Parliament who may be ineligible. Again, that throws the numbers around.

Scott Morrison: Just look. Again, I don’t think we should get it ahead of ourselves. We’ve got a process, people submit their forms. I’ll do that. It was just the other week you were saying to me people feared to do them overnight. There you go. Forms will be in front of the Parliament, and then the Parliament will be able to deal with them. That’s the process which is set out and it is our absolute intention to ensure that these things get resolved by the time we rise before Christmas. That’s what this postponement of a week actually better enables us to do so we can get on that.

Now, Bill Shorten wants to have a big winch about that because he wants to carry on and all the risk of the bullet. He’s acting in his own interest–

Ross Greenwood: The most important thing surely treasurer, is the believability. The public’s believability in this Parliament that it is actually operating, that it is working properly. Because of course you’ve now got people whose citizenship is very much up in the air. We’ve got questions about whether there are numbers there or not for Bank inquiry. There’s obviously the same-sex legislation to get through.

Scott Morrison: A lot of that noise is just being made– People are making that noise and speculating and saying well, if this happens, this could happen. If this person puts in a form, then this could happen. None of those things that people are referring to have actually happened. The Senate will sit. They will actually finalize. It is our intention a bill on same-sex marriage, fulfilling the promise we made. That we would act on the plebiscite, on the marriage survey as it ended up. Then we’ll take that in the House of Representatives. If the Senate wants to send another bill on another topic to the House of Representatives, they can.

Then we will also importantly deal with any outstanding issues on citizenship as a result of the process that we’ve put in place to deal with that. I just suggest everybody take a breath and the Parliament will keep on doing its job. We’ve passed 190 pieces or there about of legislation since the election, less than 18 months ago in a parliament that all the histrionic said wouldn’t be able to pass a thing. The lived experience since the election is that we’ve got stuff done. We’ve had 300,000 people get a job since the 1st of January this year. I’m pretty happy about that and we’ll continue to go to work every day to make sure we add to that number.

Ross Greenwood: Let’s go to the business of Australia right now because International Monetary Fund this afternoon, has put out its latest growth forecast. Also, its latest view of Australia. It’s mission has come to Australia and done. It actually says, that the growth pick up in Australia will be modest, but it would be fair to say that its growth outlook for Australia is probably more modest than the Reserve Banks and the federal government’s at this time. It’s also indicated very strongly that it believes Australia needs tax reform if it is to start to pick up and get stronger growth into the future. Would that play into your narrative as well?

Scott Morrison: Particularly when it comes to reducing taxes both for companies and as we’ve already cut taxes on two occasions for individuals. I’d love to see when or if we’re in a position to afford a further tax cuts for individuals. That depends very much on the ability to afford those things–

Ross Greenwood: The individuals need the tax cuts because tax

[crosstalk]

Scott Morrison: The name is program I’m sure with-

Ross Greenwood: All that may because bracket creep is eventually going to push them up into higher tax. Because as you and I have both talked about it before, it’s the way ultimately that the government gets the budget back into surplus. It’s off the backs of working Australians with bracket creep basically pushing him up in the higher tax brackets.

Scott Morrison: That’s why in my first budget, I lifted the tax threshold from 80 to 87,000. I did that because the full-time average weekly ordinary earnings for a year was going to clip over 80,000. We couldn’t not have a situation in this country where people were earning average full-time ordinary earnings. We’re going to be in the second highest tax bracket. I put that in my first budget. Now we’ve had the deficit levy come off, and there was enormous pressure on the government from people outside and the Labour Party and others, to say that we shouldn’t get rid of that deficit levy.

Well, we did because we believe in lower taxes and we believe that we’ve already got the tax cuts through the small and medium-sized businesses up to $50 million in turnover. We want to make sure Australia bright minds is competitive right across the board to ensure that our corporate tax rate comes down to 25%. Now, that’s where France is going. The US want to go to 20 or beat their headline rate isn’t directly comparable to ours. The UK are going to 17. So, we need to be competitive. Billy Shorten used to think this was a good idea and now he says the opposite. So, who knows what he thinks. I don’t know what he thinks.

Ross Greenwood: Before I let you go tonight, I just want to go to something I know you’re announcing this evening, and that is also with the minister of the small business and also the assistant minister for industry innovation and science. That is, that the three of you of hired Mark Burris to head up a committee that is going to try and encourage more small businesses to get online to digitize as it were. Why is that important to the country?

Scott Morrison: Because businesses that heavily digitize what they’re doing, and that doesn’t mean becoming a fintech startup or something like that. It just means that you’re using digital systems for your invoicing, for your accounts. You might be using cloud accounting payment systems and so on.

The businesses who do this are eight times more likely to create a job. They earn one and a half times more what other businesses can earn on their growth and their earnings. The digitizing of your business can really help list the performance of your business.

Ross Greenwood: Will this be a handouts to those businesses or not?

Scott Morrison: Sorry?

Ross Greenwood: Will this be a handout to those businesses?

Scott Morrison: There’s no suggestion that’s needed at all. I went to Mark and said, “You’re hired Mark.” Is to say to Mark, “Look, he’s a guy I think is looked to by small businesses around the country and as a very successful entrepreneur.” Mark’s going to lead the task force of people which is going to look at where people are digitizing their businesses, what that is delivering for their businesses, how much time that is giving back to them to focus on their business or indeed give some time back to their family which is a real strength of people working in small business. We’ve already seen from what we’ve done that it isn’t really regulatory impediments that is really stopping people, but for them to have a good sense of the benefits by taking these decisions.

There’s a myriad of products out there already with firms that offer support. Whether it’s in accounting or other systems to help people digitize. We believe that if we can help small business do that, then we’re going to get lift in their productivity, more and better pay jobs. Them earning more. It’s win-win everywhere. Mark we think will lead a really good process. It won’t be a traditional inquiry I’m going to tell you. People turning up with transcripts and suits and taking evidence.

Mark will be doing hackathons, will be engaging over social media trying to get to where small business people are and talk to them and find out what’s in the way for them. I thank Mark for doing it. It’s going to be a great panel. I think they’re going to do a great job.

Ross Greenwood: The task force reports to government by February 28th, 2018. So not too much there. People if they’ve got ideas or business can go to industry.gov.au. It’s going to be a fascinating couple of weeks when the numbers get balanced up in our parliament. Treasurer Scott Morrison. I wish you all the very best for these next two weeks.

Scott Morrison: Thanks a lot Ross. Always good to be with you. Cheers man.

Essential stories relating to this article

Money Minute – November 20 2017 Bank Royal Commission? .

Are we a step closer to a Banking Inquiry? .

Interviewed  Scott Morrison, Treasurer titled ” Why are our wages not increasing? .”

Money Minute – November 15 2017 High Noon At CommBank .

Money Minute – November 14 2017 Crisis Bites .

Interviewed  Peter Lock, Heritage Bank, CEO titled ” Will banking become more competitive? .”

Interviewed  Shayne Elliot, ANZ, CEO titled ” ANZ might have posted billions in profit, but is it as it all seems? .”

Newsletter – October 13 2017 .

Money Minute – October 11 2017 Banks Push for your Trust .

Interviewed  George Frazis, CEO, Westpac Consumer Bank (ASX:WBC) titled ” Do you trust your bank? .”

Interviewed  Michael West, michaelwest.com.au   titled ” CBA may be in more hot water .”

Interviewed  John Wacka Williams, Senator titled ” Are we headed for a Royal Commission into Banks? .”

Interviewed  Ian Narev, CEO Commonwealth Bank titled ” Commonwealth Bank’s culture and governance to be investigated .”

Interviewed  Bob Katter, Independent Senator   titled ” “I’ll be helping him out in certain directions” .”

Previous: Does Australia have an oversupply of housing?
Next: Is Amazon a threat for Australian Business?

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

325 More posts in Frequently Asked Question (FAQ) category
Recommended for you
Where are your tax dollars going?

Ross Greenwood speaks to Senior research fellow at the Centre for Independent Studies Robert Carling after...