Graham Perrett (Moreton, Australian Labor Party) Share this | Hansard source

I commend the member for Burt for his great contribution and the great work that he's done in making sure regulators do the right thing. Like the member for Burt, I'm happy to speak on this Treasury Laws Amendment (ASIC Governance) Bill 2018, a bill that amends the Australian Securities and Investments Commission Act to provide the Governor-General with the discretion to appoint a second deputy chairperson of ASIC.

The shortened version of this speech is that Labor supports an additional deputy chairperson. Why? Because of the important work that ASIC does. They have the responsibility for regulating Australian companies, financial markets, finance services organisations and professionals who deal in and advise on investments, superannuation—I'll return to that in a minute—insurance, deposit-taking and credit and have responsibility for consumer protection and conduct regulation. I particularly mention superannuation because I noted this week that former Prime Minister Bob Hawke was a bit crook. I want to wish him well and thank him for the great work that he and Paul Keating did in bringing in superannuation for everyday Australians. Now, at the end of the last quarter, we have $2.6 trillion in superannuation funds largely due to the efforts of Bob Hawke and Paul Keating and the trade union movement, obviously, in bringing in superannuation. My understanding is that's the third largest managed fund in the world. It's amazing to think of what a simple idea can blossom into.

As I said, we've learnt one thing over the last few weeks—that is, corporate governance is important, especially in the finance sector. I know the trade union movement takes its role very seriously, especially when it comes to those industry boards, where it's normally a fifty-fifty split of employers and employees. I know they do great work. We need strong and effective regulators. Why? If you don't have them, the cowboys or the crooked culture will spring up like mushrooms after rain. If you don't have a good cop on the beat, making sure they're doing the right thing, bad behaviour creeps in. Having an additional deputy chairperson will assist ASIC to be a stronger and more effective regulator, to undertake its functions with more flexibility and to engage with stakeholders. If ASIC is not able to effectively carry out the responsibility assigned to it as a regulator, it's not just the top end of town that has a hiccup; we all lose. ASIC has already been given new powers of oversight, and the Turnbull government has proposed that further responsibilities be given to ASIC, such as the management of expected additional disclosures following reforms to whistleblowing laws and administering the new Asia Region Funds Passport regime. To properly carry out these new responsibilities, ASIC must have the resources it needs to operate effectively. Labor supports this bill because Labor supports appropriate regulation of Australian companies, Australian financial services and Australian markets. We believe in good governments and in sensible governments, and all would do so.

However, it is worth remembering that, unfortunately, in the 2014 budget, the coalition government made significant cuts to the resources of ASIC—and this was while the member for Wentworth was a member of the Abbott cabinet. Some of these cuts were restored when the government was facing down a banking royal commission, but I remember them making the cuts in the first place. And, sadly, the damage has already been done. As you would expect, if you reduce the capabilities of a regulator, they can't properly regulate. The result is a financial sector where misconduct has become the norm. You see a race to the bottom, where cowboys and crooks set the standards. Anyone that does want to do the right thing will unfortunately have the cowboys and crooks say, 'No, no, we're undercutting that person.'

The Abbott and Turnbull governments have shown complete contempt for the important role that ASIC plays in Australia's corporate sector. In response to the financial system inquiry report, released in December 2014, the government promised to update the statements setting out the government's expectations for how ASIC will fulfil its mandate. They promised they would be updated by mid 2016, but it took until 2018 for them to do this. That is totally unacceptable. We know where the Turnbull government's priorities lie. It's not hard to see. It was again evidenced in the budget last night, when they confirmed their $80 billion tax giveaway to big business. Remember: $17 billion of that taxpayer giveaway will go to the banks.

For 601 days we saw the Turnbull government running a protection racket for the big banks by resisting the Labor Party's calls for a banking royal commission. They were very quick to declare royal commissions when they came into office but not so quick when it came to something that will benefit the Australian people. They were happy to go after a government scheme that was rolled out during the financial crisis and they were happy to go after Labor leaders, calling up what may or may not have happened 20 years before or the like. Bill Shorten was hammered with question after question for a political process, some might say. For 601 days, the Turnbull government resisted calling a royal commission, when financial misconduct continued unabated and in fact actually blossomed. For 601 days Australian mums and dads and small businesses were being ripped off mercilessly. For 601 days the Prime Minister continued to argue that there was no need for a royal commission. It was only when the big four banks themselves wrote to the Treasurer and told him that the government should call a royal commission into the banking sector that finally Prime Minister Turnbull relented. The banks told him when to jump and how high. It was unbelievable that a Prime Minister of this country could be dictated to by the banks. Surely nobody would now dare argue that there was no need for a royal commission into the banking, superannuation and financial services industry. I haven't seen any apologies from those opposite, saying why there were 601 days of delay. Who knows what heartbreak we may have avoided if they hadn't needlessly delayed for 601 days?

This is not the first time the coalition has been riding shotgun for the banks and financial sector. When Labor was in government, the coalition was in fierce opposition to Labor's Future of Financial Advice laws. I see the member for Oxley in the chamber. I know he's very passionate about some of the small lenders and the shonky practices that go on in this area. Those laws gave ASIC important new powers to rein in poor financial advice, but this coalition voted against those laws in the House and the Senate. When they got into government, they then tried to gut them. It was only the continued resistance of Labor that stopped the government from decimating the Future of Financial Advice laws. There is no doubt that these laws have proved their value. ASIC has been able to identify $200 million in fees that the big four banks and AMP have been taking from customers despite providing no service at all. Imagine that: $200 million taken from everyday people without providing anything at all—even, as we've heard, after the customers are actually dead. The ASIC report Financial advice: fees for no service, delivered in October 2016, found that although great systems were in place to record what money was coming in, there was no system to establish what customers were getting in return—in many cases, nothing at all. As a lawyer, you're used to charging for your advice. As a paediatrician, you're used to being paid for a service.

Dr Freelander interjecting —

What's your seat name?

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