House debates

Wednesday, 26 May 2021


Financial Regulator Assessment Authority Bill 2021, Financial Regulator Assessment Authority (Consequential Amendments and Transitional Provisions) Bill 2021; Second Reading

11:44 am

Photo of Julian HillJulian Hill (Bruce, Australian Labor Party) Share this | Hansard source

Labor will support this bill, the Financial Regulator Assessment Authority Bill 2021, and I'll support this bill because the royal commission recommended it—that's what it boils down to. It puts in place quadrennial capability reviews and a new authority to assess the effectiveness and the capability of financial sector regulators. It does it in a minimalist way, though, it's fair to observe It's almost, you might say, like the government doesn't actually want to do it, but the royal commission said they should so they're kind of going along with it. There are three part-time members and the Secretary of the Treasury ex officio. I mean, the Secretary of the Treasury is probably a little bit busy to take this very seriously and put time into it, but, nevertheless, there it is.

The fact that the royal commission found it necessary to put in place these recommendations for a new authority to oversight financial regulators is a sad indictment of the government's failure to manage effectively the oversight of financial services and the economic regulators. To say they've had a laissez-faire approach to this in their eight years in government would be an understatement.

The financial regulators are already some of the most heavily oversighted parts of the public sector. They're oversighted by multiple ministers—cabinet, junior, outer ministry and assistant ministers—and multiple departments and agencies. The Australian National Audit Office pays regular and ongoing attention to their performance. Public governance frameworks and legislation apply across the board. The International Monetary Fund's Financial Sector Assessment Program also does a bit of this work. And there are multiple parliamentary committees. There's no shortage of oversight, already.

What is lacking is the political will of the government—of ministers and the backbenchers who comprise these committees—to actually do the job and take it seriously. This stuff requires focus and serious work. I acknowledge, Deputy Speaker Wallace, you've recently been appointed Chair of the Parliamentary Joint Committee on Corporations and Financial Services. I was recently appointed as a member. The first two meetings have gone well. I'll give you a tick for that. People have participated. We've actually initiated a couple of inquiries, which, if they proceed, will double the amount of work the committee's done in this term of parliament. But this stuff really matters. It's not esoteric. It might be pretty dry. There's a lot of paper. But it really matters to the real economy, to oversight the capital markets and the whole financial services system and banking sector.

I want to call out the failure of the government and the parliament's committees with government majorities to actually do their job. The House Standing Committee on Economics, as we heard the member for Goldstein rabbit on about earlier, and the Joint Committee on Corporations and Financial Services are powerful committees. They're always described as such in the media. In fact, the Joint Committee on Corporations and Financial Services has one of those rare own-motion inquiry powers—it can actually go and initiate inquiries into anything without a reference from a minister or a house of parliament. That's a serious power and a serious responsibility. It's got formal responsibility to inquire into the activities of ASIC and the Takeovers Panel. It also has purview over the ASX, the ACCC, APRA and AUSTRAC. The committee is required to examine the annual reports of the Financial Reporting Council, the Australian Accounting Standards Board, Australian Auditing and Assurance Standards Board and the Companies Auditors Disciplinary Board, amongst others.

Under Labor, these committees did serious and important work. I'll give you an example. Under the former Labor chair of the joint committee, Bernie Ripoll, 10 years ago, they launched a serious inquiry into the collapse of Trio Capital that assessed the failure of the regulators in a very methodical way—a brutal way, some might say. They handed down a serious report into the regulatory system and the serious reforms that were needed to overhaul it, which were then implemented. Bernie Ripoll was also responsible for the Future of Financial Advice reforms—landmark reforms, as they were described and still are. Under this mob, though—little serious work. So far, in this term of parliament, the joint committee has handed down two reports—two reports in two years. In the last term, they handed down five in three years. In the term before, they handed down four in three years. Yet, in the last term of the Labor government, from 2010 to 2013, there were 21 reports in three years. This committee did serious work. It was taken seriously by Labor members. They did important landmark work which has stood the test of time. This mob, under the Liberals, have been failing to do their job on these committees, going off on ideological frolics and personal political vendettas.

One of the two reports that the committee's done this term was into litigation funding, an ideological pursuit by a bunch of extreme right-wing backbenchers—senators and members—trying to get their names in the paper. It was a politically motivated inquiry that was trying to make it harder for ordinary Australians to access justice in the courts. Their objective was to shut down public interest litigation and have a few little wrecks on the way through to weaken corporate regulation—weaken disclosure requirements. What did the stakeholders make of their work? They said it was a great day for the corporate cowboys to weaken disclosure of corporations. The committee's work got bagged by everyone, and that was only one of the two inquiries. It's no wonder, with that kind of work, that the royal commission said, 'We need some more oversight in this area.'

But then the member for Goldstein in the Economics Committee stood accused last term of misusing the committee, shamelessly, for political purposes and party political objectives. He was accused 'of improperly using a taxpayer funded inquiry into Labor policy'. He racked up more than $200,000 in travel bills, hotel bills, car bills and room hire bills to have a series of public hearings—better described as public circuses—around the country. They didn't actually have formal witnesses, like every other parliamentary committee I've been on; they were just free-for-alls, like an angry mob they whipped up, telling untruths about Labor policy. Worse than that, though, they colluded with private interests. His own relative Geoff Wilson founded a company that's managing $3 billion of funds, including two that the member for Goldstein had a personal interest in, which he didn't declare at the committee hearings. He was—


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