Tim Hammond (Perth, Australian Labor Party) Share this | Link to this | Hansard source

I rise in relation to the matter before the chamber insofar as I seek to acknowledge the excellent work done by the Labor members on this inquiry, honourable members Thistlethwaite, King and Keogh, and the incredibly hard work that they put into very thorough and well considered dissenting reports in relation to both the first report of the review of the four major banks, which was published in November last year, and the recently released second report of the review.

What is very telling about the common themes that run through the dissenting reports of my fellow members is that, whilst there is some window-dressing around reforms that are long overdue in the banking sector, what we all know is that fundamentally there is only one compelling ray of sunlight that is likely to be appropriate disinfectant for ongoing misconduct by the banking sector at the expense of mum and dad consumers, and that, simply, is a royal commission.

When one traverses the recommendations of the government members' report—again, paying heed to the members for Kingsford Smith, Burt and Brand—one constantly comes back to the fundamental point that, whilst many of these recommendations are worthy of review, the matters can only be addressed holistically through a royal commission.

I note that, in November 2016, the dissenting report finished by stating that a royal commission into the financial services industry should examine issues such as:

I would like to touch upon other events shortly but, to conclude on the dissenting report, the honourable Labor members put it thus in a media release—and I could not put it better myself:

This Royal Commission should be initiated without delay to ensure justice for the victims of banking misconduct and restore public confidence in the Australian banking sector which has been badly damaged by the string of scandals in recent years.

I echo those sentiments, and I am very proud to say that that approach was followed through consistently in relation to the second report.

Again, it is worthy to note that one really has to question the extent to which we are truly going to uncover the conduct at the heart of the behaviour with the banks insofar as the inquiry in which these hardworking honourable members devote so much of their blood, sweat and tears to allows them 20 minutes each to undertake a questioning or cross-examination of the CEOs of these big four banks. Make no mistake, there are reasons for why these CEOs command bonuses and salaries in the multimillions of dollars. They are not silly people, and they are not people who have not been around the block a few times. They know how to answer questions. They know how to do duck and weave from the hard questions, and they know how to make their 20 minutes last insofar as it means preventing these hardworking members from getting to the guts of the issues in relation to alleged misconduct. That is why we need a royal commission which allows unfettered access into the executive sector of the banking stream to make sure that evidence is given under oath with documents being put to them in a way that does not allow a tick-and-flick exercise of simply going through the motions for 20 minutes.

I am very pleased to say the tenacity of the honourable members on our side of the parliament shone through again in the second report. Having reviewed the recommendations in the second report, I will outline or articulate the conclusion as follows. The dissenting members said, 'As Labor members recommended after the first hearings we again urge the government to take responsibility, stop defending the banks, and establish the systematic, thorough and transparent investigation that only a royal commission can provide.'

We see absolutely nothing in the budget that was delivered last night which can offer mums and dads of this country any comfort or any assurance whatsoever that there is a sufficient deterrent in the corporate culture of these banks so as to prevent misconduct from occurring. What we saw in relation to the announcements last night in the budget insofar as attempting to curb the unethical behaviour of banks goes is a similar theme that we saw in relation to the Treasurer's half-hearted attempts at reform in the areas of health, education, infrastructure, general finance reform and, certainly, the banking sector. Make no mistake: this so-called, alleged, attempted heavy-handed approach at a levy on the banking sector is simply risking being in one door and out the other because there is no guarantee here, regardless of what the Treasurer says, that the cost of the levy will not otherwise be passed on to mums and dads paying mortgages or hardworking Australians who buy shares in these banks, often for superannuation purposes. It is up to the government to make sure that banks are paying their fair share. We do not see enough reassurance right now.

I want to make this point: the unethical culture in the banking sector is not one which is limited to adverse and harmful impacts upon customers and consumers; it is an environment which has adverse and harmful impacts upon employees. Before coming to this place, I had the great honour of being involved in a case representing a former bank manager of the Commonwealth Bank. In a published decision, called Commonwealth Bank of Australia v Reeve, a full Federal Court decision, the Commonwealth Bank resisted paying Mr Reeve compensation for his mental illness, on the basis that it was caused by what they considered to be 'reasonable administrative action.' The facts of the case, as I said, have been published, so they are public knowledge. Mr Reeve, a bank manager at a suburban branch of the Commonwealth Bank, was placed under pressure to deliver a sufficient level of service, so as to attract a score rating of nine or 10 on customer feedback forms. He was placed under so much pressure for so long—feeling humiliated at having to justify his existence, in relation to delivering customer service, time and time again—that he attempted to end his life three times. This was as a result of the pressure placed upon him by his employer, the Commonwealth Bank. Luckily for us, and luckily for his family, he was not successful in those attempts. He was diagnosed with a major depressive condition and spent years fighting to be compensated—simply to have his wages paid and his medical treatment paid—through the court system, not just at the AAT but to the full Federal Court of this country, to be compensated for the illness that was caused by the conduct of these banks.

In conclusion, I take this opportunity to make clear that it is due to the good work of the Labor members on this inquiry, and their consistent and tenacious approach in calling for a royal commission, that, hopefully, one day we will see a proper examination of the conduct of these banks in a way that allows us to truly shine a light on every area of potential misconduct, to make sure that consumers are not affected, that shareholders are not affected and, importantly, that employees are not affected—not now and not ever.

Debate adjourned.