Lindsay Tanner (Melbourne, Australian Labor Party, Minister for Finance and Deregulation) Share this | Hansard source

As you know, Madam Deputy Speaker, I have spent a long time, far too long, in opposition in this place and over that time I prosecuted a few arguments in things like MPIs and censure motions on the waterfront scandal, the Dubai exercise, Peter Reith’s telecard, the travel rorts, the CASA board scandal—a variety of things. I have seen others prosecute similar arguments, but rarely have I seen so much noise, so much dishonesty and so much misrepresentation with so little merit in an argument being prosecuted by an opposition through the substantive mechanisms of this chamber. In fact, it is amazing that the member for Curtin even has the gall to turn up today after her complete evisceration by Tony Jones on these issues on Lateline last night, because in response to the question, ‘What evidence do you have to demonstrate that the Secretary of the Treasury failed to convey to the cabinet concerns that the RBA, the Reserve Bank of Australia, held with respect to the government’s proposed guarantee of bank deposits and what evidence do you have that the Reserve Bank was expressing serious concerns with respect to those guarantees to the government before the announcement on 12 October?’ over and over again she was unable to provide any evidence, and she kept resorting to a word she used a couple of times again today—‘inconceivable.’ So, from her point of view, it is inconceivable that it did not happen and therefore it did happen. It is inconceivable that the Reserve Bank did not make these statements to the government; therefore, by definition, that is evidence that it did occur.

Off the back of zero evidence, off the back of literally no substantive evidence whatsoever, the member for Curtin and the Leader of the Opposition, and by implication all the people who are in the chamber on the other side today, are happy to slander and impugn the reputation of one of Australia’s outstanding public servants, who gave good, loyal, high-quality service to governments of both persuasions over an extended period of time. They are happy to suggest that he lied to the government of Australia and to the cabinet subcommittee that was dealing with these situations in a highly charged environment. They are happy to imply that and to include that within a question. Today, even more disgracefully, Senator Abetz—who is usually up to this kind of thing—said in response to answers by the Secretary of the Treasury in Senate estimates hearings that the secretary’s answer ‘does not sound to have the ring of truth about it’. Not content with accusing him of lying in question time yesterday, the opposition are accusing him of lying to the Senate today. I learned in opposition that, whatever the temptations of pursuing issues in question time may be, you do not ask a question unless the implication behind the question is backed up by some evidence. You do not ask a question that has a serious implication to it and that casts aspersions on ministers, other members, members of the public or public servants unless you have some substantive evidence to back that up. What the opposition did yesterday was completely disgraceful. It showed total contempt for the democratic process, total contempt for the parliament and particularly total contempt for the good public servants who have served this government, the previous government and the one before that loyally and diligently and done their job—in this case somebody who is right at the top of the list of those good public servants.

It is perhaps a slightly smaller matter, but, of course, the Treasury secretary is not the only person who has been the subject of dishonesty and misrepresentation by the opposition. I copped a little bit of it yesterday myself. The suggestion was made by the member for North Sydney that on television I had stated that when I was acting Treasurer I did not know about any of these things, I did not understand them and I had no role to play in these decisions. This was allegedly on the basis of statements I had made on the Agenda program on Sky TV. In fact, it is very clear when you read the transcript that the statements that I had made with respect to not knowing about specific matters were about matters happening now, because they are not in my portfolio. Yes, I could be expected to have some knowledge of them were I dealing specifically with them as either the minister or the acting minister. Deliberately misrepresenting my comments again and exercising complete dishonesty in the debate, the member for North Sydney yet again sought to mislead and completely muddy the waters on these issues.

For the benefit of the House, I would just like to give an explanation of the issues that have been involved here for the government in dealing with these questions about bank guarantees. I notice that in her contribution today the shadow Treasurer, the member for Curtin, was yet again doing the same thing—a little bit of slippery misrepresentation to suggest that comments that I had made on Melbourne radio this morning meant something quite different from what they actually did mean. I will get to that in a second. If I give a bank $100, that is a deposit. If I give the bank $100 million, that starts to take on the categorisation of some kind of wholesale loan. There are two obvious differences here, and you will note that the government has proposed two different regimes of bank guarantees for these two things. Between those two obvious and stark examples, there is a plethora of different circumstances—1,001 different products and a variety of situations. There is a question about at what point a deposit moves into a different category. These are the kinds of issues on the cusp between those two things that the government has been dealing with. Those were the issues that my comments related to: the grey area where clarity and finetuning was required.

The government has always made it absolutely plain that these issues would need to be dealt with by the regulators and by the government. Notwithstanding all of the suggestions of grand conspiracies, of lying public servants and all of the other suggestions that the opposition have made, it is perfectly reasonable and proper that these issues be dealt with. I note that the Deputy Leader of the Opposition is now claiming that the government’s approach on the question of guarantees of bank deposits and borrowing is ‘flawed and hasty’. That is extraordinarily different from the position that was taken by the Leader of the Opposition on the same decisions little more than a week ago. When they were announced—we gave him a briefing prior to the announcement—he went into his best statesmanlike, Churchillian bipartisan mode. He was on the verge of proposing a war cabinet, with him as Prime Minister, but he probably did not think it was going to get any traction. He did not quite get to that stage, but he was pretty close. We had 24 hours—maybe 48 hours—of love, cuddles and bipartisanship coming out of the opposition. Then the sniping started. Then the undermining started. Then the attacks started. And, gradually, bit by bit they walked away.

Where are we at now? It has been confirmed by Senator Brandis today that the opposition’s previous policy stands—in other words, bank guarantees for deposits up to $100,000 only. We have also had the Leader of the National Party in the Senate, Senator Joyce, state in response to Senator Cameron that he does not support the government’s Economic Security Strategy. In other words, all those pensioners, carers and families out there that are going to get significant one-off payments to help stimulate economic activity had better have a chat to the opposition and ask them what their real position is: ‘Do you support this stimulus package? Do you support the Economic Security Strategy? Yes or no? Because the Leader of the National Party in the Senate has said today that he does not support it.’

The Deputy Leader of the Opposition made some reference to particular matters in regard to the boundaries of these bank guarantee issues—and I will get to those in a minute. I would like to conclude on the question of the allegations with respect to the Reserve Bank’s advice to the government and the alleged lying on the part of the Secretary to the Treasury. I would like to walk you through the sequence of events. On the weekend of 11 and 12 October, the strategic policy and budget committees were meeting extensively—myself included as a member—and the Secretary to the Treasury advised the government at that meeting that the proposals being put to it to had the support of the other regulators, including the Reserve Bank. I would remind the House that the Secretary to the Treasury is a member of the board of the Reserve Bank, so there is a reasonable chance that he might actually know what the Reserve Bank’s position is. On 12 October, when these were announced, the media release put out by the Prime Minister said, ‘details will be finalised in the next few days’. The opposition seems to have missed this point. There was an explicit statement at the time this was announced saying ‘details remain to be dealt with’ and acknowledging that these issues needed to be resolved.

On 15 October—a few days later—the Treasurer introduced legislation and made reference to the fact that finetuning of the detail was underway and that there was still some finetuning required. Indeed, on 17 October—still within what I consider to be a few days—the Reserve Bank wrote to the government outlining some of its views on some of the issues involved in that finetuning. Then, on 21 October, some of this material appeared in a newspaper report, suggesting this meant the Reserve Bank was contradicting the government’s position. Then the opposition took off into the stratosphere—suggesting this meant that the government had acted contrary to the Reserve Bank’s advice, that the Treasury secretary had lied and that it was all a giant conspiracy—beating the whole issue up to a level of hysteria that I have rarely seen in this chamber; that is a big statement, I can tell you. Then, on the same day—October 21st—the Governor of the Reserve Bank made a statement saying that the Reserve Bank supported the government’s position on the deposit guarantee, therefore revealing how totally bankrupt and how totally threadbare the claims on the part of the opposition actually are.

I will turn to the question of non-ADI institutions—non-approved deposit-taking institutions—and the questions that were raised by the opposition during the course of question time today and indeed during the contribution by the Deputy Leader of the Opposition. The important point is that we are dealing here with organisations that are not regulated by APRA, that are not approved deposit-taking institutions, and the issues are indeed complex and varied. So it is difficult to be absolutely specific about particular institutions without detailed knowledge of their circumstances. There is no question that, in some of these cases, the turmoil in international markets and indeed the Australian stock market in recent times has had a significant effect on their circumstances. Of course, some of these institutions, well before the government’s guarantee was put in place, have had significant problems and we know of several high-profile difficulties that occurred during the earlier part of this year amongst institutions of this kind. So there have been other factors involved in issues that are currently afoot in this sector of the market.

But there is an underlying implication that is a question for the opposition. They clearly support at least some guarantee of deposits. It appears that it is up to $100,000; that appears not to be in doubt. They now appear to be suggesting that this guarantee should be extended to organisations that are not regulated by APRA, that are not approved deposit-taking institutions. That takes this matter to a whole new and different level, because, where you have got organisations that are strictly regulated by the prudential regulator, the prospect that the government has of ensuring that moral hazard does not run amok is genuine; it is substantial. But, where you have a situation where organisations that are not within the purview of the primary regulator and therefore, by definition, are much further removed from the capacity of the government to scrutinise their activities and their risk taking, inevitably you have a very different situation. A government guarantee that is given willy-nilly, across the board, to a wide variety of these organisations raises a whole lot of questions about what risk-taking activity they would then potentially engage in or some of them would potentially engage in—and indeed what marketing activity—knowing that they were backed by a government guarantee.

There are complex issues involved here; there is no question about that. The government, as I said, whether in this area or the other areas, is proceeding to deal with these questions. I would suggest that it would be a good idea for the opposition to cease hyperventilating. I do not think it does you any great benefit. If you took a step back and looked at these issues seriously, you would see that there are really major issues that any government in the circumstances of the past couple of weeks would have had to have come to terms with and that we have been clear and open about our position as a government all the way through. We indicated in the statement that was put out by the Prime Minister on Sunday, 12 October that there were detailed issues that still needed to be resolved and that they would be resolved in the ensuing days.

In conclusion, I think what we have here is an explanation for the behaviour of the opposition. They are desperate to insert themselves into the story. They are shackled by their initial bipartisanship and they are desperate to break away from that and to attack the government and to attack every element of the government’s strategy while pretending to support it. We are not going to be diverted by this nonsense. We are going to govern responsibly. (Time expired)

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