Peter Whish-Wilson (Tasmania, Australian Greens) Share this | Hansard source

This legislation before us today, the Treasury Laws Amendment (Banking Executive Accountability and Related Measures) Bill 2017, is called BEAR—banking executive accountability and related measures. If this legislation before us today is to hold senior executives at the big banks to account, to make their decisions transparent and to put in place a punitive measures regime to actually see that they follow through with that accountability, then it really is nothing but a fig leaf. I will admit that it is the opening of a door—a crack in the edifice of the neoliberalism of the coalition. It's only slight, and it's not going to fix the cultural issues that we see at the big banks, that many senators know all too well and that Greg Medcraft, the ex-head of ASIC, the Australian Securities and Investments Commission, talked about ad nauseam in his time at ASIC. It's not going to fix the cultural problems, but it is the opening of a door that we can exploit today in this chamber in this parliament to take a big step in fixing the problems. I'll tell you why we can do that and how we can do that shortly.

Let's frame it up. The banks have behaved very badly in this country for well over a decade now. None of us would disagree with that, and I think if you were to step outside this building very few people would disagree with that assumption. Underlying that bad behaviour has been a culture across the financial services industry. Sometimes it's hard to pin down exactly what that culture is for many people, but for me it's actually quite simple. It's been a culture of making as much money as possible. It's a culture of greed and of chasing profits at all costs, a culture of putting profits before people, profits before customers, profits before many employees at the big banks. As custodians of the financial services system, these banks have failed, to use the words from the legislation before us, 'higher standards of accountability and integrity' that are expected of them by the Australian people.

But it is also recognition that the big banks have failed to respect that their very existence in this country is a privilege not a right. Go and have a look at the Banking Act. This is actually tied to our country's Constitution. The very first clause of the Banking Act talks about banks being issued a licence to operate by the government for the Australian people. So there's this privilege of being able to operate in an industry where every individual and business is a customer and, given the importance of the industry—and this has been locked in since the GFC—these businesses are now insured by the government and the Australian people. They're too big to fail. Guarantees have been put in place. We've seen this all around the world, but it's officially a policy in place here in Australia. So they are issued a licence to operate by the Australian people—it is literally a licence to print money—and they're insured against failure by the Australian people.

And what do they do? They make massive profits. I acknowledge that those profits do go to shareholders and that many Australians are stakeholders in the banks through shareholdings through their superannuation funds, but these senior executives—exactly the kinds of people that this legislation is designed to hold to account—pay themselves obscene amounts of money. It is totally unjustifiable. Once again, go outside this chamber. Ask anyone in the lobby who is visiting Parliament House. Go outside the walls of this place. Walk down the mall in Civic or go to my home town of Launceston or wherever and ask people, 'Do you think bank CEOs are paid too much?' I would be shocked if someone said no. It is possible but very, very unlikely.

The Treasurer, in his explanatory memorandum, says that this legislation is designed to help hold bank executives to account, to meet 'community expectations'. Where is the community expectation that a CEO at Commonwealth Bank can be paid $12 million, 100 times the average weekly earnings for your ordinary Australian and many more times the basic minimum wage? What about the CEO of Macquarie Bank, who was paid nearly $30 million in one year, 300 times what the average Australian earns? These are businesses set up by the government and licensed by the government and the Australian taxpayer, and guaranteed by the Australian taxpayer. Quite frankly, these CEOs are taking the piss. They are taking the piss out of the Australian people.