Monday, 19 June 2017
Major Bank Levy Bill 2017, Treasury Laws Amendment (Major Bank Levy) Bill 2017; Second Reading
It is with great pleasure that I am rising to speak on the Major Bank Levy Bill 2017, because it is a rare day that as a Greens senator I get to speak on legislation that is Greens policy that has been adopted by the government. The idea of a levy on the banks has been Greens policy for over a decade, and there is a very simple reason: this money that is in some way going to be recouped from the banks is in fact money that belongs to the people of Australia.
Since the global financial crisis, the government's implicit guarantee to the big five banks that they are too big to fail, that if anything happened to them the government would come in behind them and make sure they do not fail, has been worth real dollars, real cash, to the banks. The estimate of how much that implicit guarantee is worth to the big five banks is somewhere around $3¾ billion to $4 billion a year. That is money that, if anything happens to them, we will come in and support them. It is our money that the banks are benefiting from. And it is a benefit that those big five banks have that the other banks do not have. There is a very clear logical reason that we, as the people of Australia—and the government of Australia—should be recouping some of that value from those big five banks.
So this bill today is going some way to recouping that, in the order of $6.2 billion over the next four years. As Greens we reckon that, in order to really be recouping it, it could be twice if not three times as much. But look, it is a start. And that $6.2 billion is an important piece of revenue. The issue we have in terms of balancing the budget in this country is that we get told a lot that we have a budget crisis, but we do not have a budget crisis; what we have in this country a revenue crisis. There are many, many opportunities we should be taking up to be raising revenue, to be able to spend it on the critical services, the critical infrastructure, the critical resources that we need as a country. So, if there is $6.2 billion that is there and that is fair to be gained from the banks, then getting that $6.2 billion is absolutely the right thing to be doing.
Let's have a think about the sorts of things that $6 billion is being put towards and that, if we doubled or tripled it, could be put towards. This week we are focusing on education funding. As you know, we are in negotiations as to how much money is going to be spent on schools. This is not money to be frittered away on fanciful extras in our schools; this is critical money that is needed by our schools to make sure every student in this country has the resources they need, to bring every student up to the level that has been determined as being fair—the school resource standard. That is the sort of thing we need money for. That is the sort of thing this $6 billion is being put towards.
If we were raising more money, if we were having this bank levy at a level that the Greens feel would be justified, we would have money we could afford to be putting towards higher education so that we do not have to have these cuts that are being imposed on higher education. I was talking with friends at the weekend who told me how tragic were the cuts underway at Victoria University in Melbourne, where 168 academics are losing their jobs and there are large class sizes because resources are not going into higher education. That is the sort of measure we should be supporting with extra revenue.
We should be raising enough money to make sure we can provide quality health services and sure is working effectively. If we had more revenue coming in, we might be able to continue and expand, keeping dental care included in Medicare. Again, everybody in Australia knows it is ridiculous that the rest of our body is being covered by Medicare—but not the problem of the mouth! Dental care should absolutely be included under Medicare. But we are told, 'Oh no, we can't afford to do that!' But with extra revenue coming in, that is the sort of measure we would be able to afford.
Unemployment benefits have stagnated, flatlined, for so long. People on unemployment benefits are now living in poverty. They cannot afford to rent a house anywhere in any of our major capital cities. Imagine if we had the revenue to increase unemployment benefits to make sure every Australian has the resources to live a life of dignity. We could put solar panels on all social housing, on all low-income houses. That would be a really important thing for reducing the energy bills of the most vulnerable in our society. We could pay for major infrastructure projects. The $6 billion we are talking about today could pay for a major rail project in any of our cities. These are all critical projects that we need to have the revenue to pay for. So it is very pleasing that we are at least moving forward in some way and recognising that there are legitimate, fair responsible ways of raising that revenue.
The other issue raised in debate today is that this levy is a very significant impost that is going to affect the banks and potentially be passed on to their customers. My colleague Senator Whish-Wilson pointed out what a furphy this is. The banks have just retained their AAA credit rating, and the bonuses of the bank CEOs add up to $300 million a year, which is a third of the amount being raised by this bank levy. As I said at the beginning, this our money. The banks can afford to pay it, and it is a legitimate thing for them to pay it. There is a lot more that needs to be done to make our banks socially responsible and regain their place as top-quality corporate citizens. We have been doing work to get a parliamentary commission into the banks, which went through the Senate last week. Once that gets up, or a royal commission gets up, it will shine a spotlight on what needs to happen for the banks to lift their game.
It is worth noting that there are only two banks in Australia that are members of the Global Alliance for Banking on Values. Notably, neither of those two banks is one of the big five. The mission of the Global Alliance for Banking on Values is to use finance to deliver sustainable economic, social and environmental development, with a focus on helping individuals to fulfil their potential, and to build stronger communities. I reckon that is a pretty good mission for all banks. It is the sort of mission that I think all banks should be able to sign up to. I look forward to some of our big five banks deciding that they too can join the two banks in Australia that are members of that global alliance. At the moment Bank Australia and Teachers Mutual Bank Limited are the only two banks in Australia that have signed up to that alliance. There is a long way to go for the banks. But what we are debating today—this decision to have a levy on the banks—is a really good start towards getting the banks, and those big five banks in particular, to pay their way.
I look forward to seeing the government adopting other Greens policies in the future. It would be a really lovely thing to see, but it is probably too much to ask for. We will put issues like reforming negative gearing and the capital gains tax discount, and ending fossil fuel subsidies on the agenda as well, and hopefully we might get the same sort of support that we now have for this bank levy. In the meantime I am very pleased to be joining my other Greens colleagues in supporting this bill.