There’s many ways to dull the impact of a Royal Commission before it even begins. Swamping it with a ridiculously wide brief is one of them. Ross Hamilton weighs in on Malcolm Turnbull’s ‘Banking Royal Commission’.
Word is going around that despite everything, the banks aren’t really that worried about the Banking Royal Commission. And why would they be? Our government has demonstrated very clearly that it isn’t fair dinkum about the behaviour of the banks. Malcolm Turnbull was particularly insistent that an inquiry wasn’t necessary as they already had the banks in line. And the format of the Royal Commission has pretty much ensured minimal damage will result.
One thing both sides of parliament have right is that the Big Four have become so big that they simply cannot be allowed to fail. Consequently, they have been allowed to do pretty much what they want, helped by repeated budget cuts reducing the effectiveness of the agencies who are supposed to be monitoring and regulating the financial services sector.
A decade ago, the banks were the centre of attention for their failure to pass on to their customers all of interest rate cuts. Increasing bad publicity finally saw them back off a little. After another interest rate cut, one of the Big Four announced that it was going to pass on something like 85% of a cut, an increase over the lesser amount they had passed on in other cuts.
Malcolm Turnbull was Leader of the Opposition at the time and he was quick to call a press conference. According to Turnbull, the only reason the banks had increased the amount of the rate reduction to be passed on to customers was because the Opposition had “drawn a line in the sand” that the banks were not going to cross.
Huh? Were we supposed to believe that the banks really were that scared of the party that wasn’t even in government? Not surprisingly, then-Treasurer Wayne Swan was laughing in his response to Turnbull. Was Turnbull really that arrogant to believe it or did he think we are all gormless idiots who would believe any old rubbish?
Jump forward a few years and Turnbull is Prime Minister. And the banks are again (still) under fire. Abbott wasn’t interested in taking sides against the banks. And after he knifed Abbott and tried hard to lose an election, Turnbull made it very clear that he didn’t want to either.
It was repeated shockers by the Commonwealth Bank in particular, that finally forced Turnbull’s hand. But a Commission? Oh no – no need for one of those. Instead Turnbull boasted that they had the measure of the banks by forcing them to annually face a Senate Committee.
Turnbull’s boast was soon shown to be hot air. In the wake of appalling behaviour within their financial services divisions, the Commonwealth Bank of Australia (CBA) engaged an external party to conduct a review of matters. And the review found that nothing was wrong at all, that everything was just fine and dandy. It came out at their appearance before the Senate Committee that the review had not spoken to any of the people ripped off by those shenanigans. For that matter, the review apparently didn’t speak to a single CBA customer at all.
The Committee spoke angry words. And that was that. Was anything done to pull the CBA into line? Nope. Did the CBA senior execs display any concern? Nope. Did this Committee change anything? Nope. The entire Committee appears to have been a complete farce, designed merely so Turnbull could point to it and say ‘look – we’ve taken care of things,’ while seemingly making sure the banks were still looked after.
The banking dramas continued. And continued. Things probably came to a head with the Commonwealth being found to have, intentionally or not, allowed money laundering to occur. And the other banks were also being repeatedly caught out.
At long last Turnbull had to admit defeat. Sort of.
We now have a Banking Royal Commission. But how could they possible fix it so that it doesn’t achieve much, thus keeping their Big Four mates happy? Easy. Arrange it so that the Commission has too much to do.
Rather than just focus on the banks, the Commission must also look at broader financial services, insurance and superannuation. Despite the complexity of this big menu, it was all to be finished in 12 months with their report due by 1st February 2019. By contrast, the Royal Commission into Institutional Responses to Child Sexual Abuse took five years.
The likes of Turnbull and Scott Morrison have ensured that, no matter how well-intentioned Justice Kenneth Hayne may be in heading up the Royal Commission, he has far too much scope to enable any of it to be properly addressed within the timeframe given. As such it is another meaningless farce, like the Senate Committee, but one that is costing taxpayers upwards of $65 million. And has it escaped attention that delivery in 2019 will probably coincide with the next election year?
Rather than banks running scared of governments or oppositions, it seems we have political parties that are in fact the ones chewing their nails. The Big Four are too big to fail, so our governments, especially the Liberal ranks, are making damn sure they do as little as possible to disrupt or upset the banking sector.
As for those of us ripped off – tough cheddar.
Donate To New Matilda
New Matilda is a small, independent media outlet. We survive through reader contributions, and never losing a lawsuit. If you got something from this article, giving something back helps us to continue speaking truth to power. Every little bit counts.
