22 November 2010
Andrew condemns the arrogant behaviour of Australia’s big four banks and speaks in support of reform of Australia’s banking sector
Mr WILKIE (9:10 PM) —I rise to condemn the arrogant behaviour of Australia’s big four banks and to speak in support of reform of Australia’s banking sector. I, along with many Australians, was shocked on Melbourne Cup Day when the Commonwealth Bank announced a rate hike of 45 basis points, almost double the official rate rise. But, regrettably, I was not surprised when ANZ, NAB and Westpac all followed suit, each putting their pursuit of profit above the public interest as they raised their rates over and above the Reserve Bank’s one-quarter of one per cent.
The banks cried poor and blamed rising funding costs, but these are the same corporations enjoying record combined profits of more than $20,000 million a year—yes, well over $20,000 million a year. As an argument, funding cost pressures simply do not stack up, because the banks are raking it in and there is simply no basis for their claim that they are in strife. Moreover, the bosses of Australia’s big four banks earn between them $44 million a year—yes, $44 million a year between four individuals—and that is simply outrageous. Here we are picking up the tab for billion-dollar profits and million-dollar salaries, and we are not happy about it. Something has got to give.
The balance needs to shift back to the community, which not too long ago helped these same banks survive the global financial crisis. The banks came running when they were in trouble and the government gave them a hand. Now it is the banks’ turn to return the favour and give the Australian community a break. With their combined $21-plus billion profit a year, a bit of consideration for the public interest is not something that is going to break the bank. It is time for change and, since the banks will not act, it is time for political leaders to act. I for one will support any sensible reform which reins the banks in.
Of course the banks say that we do not understand how it all works. ‘It’s complicated,’ they say. They call outspoken politicians ‘populist’ and tell us to butt out and stop bashing the banks. Well, I will not buy that, Mr Deputy Speaker. There is some bashing going on all right, but it is not the banks getting bashed; it is their customers. It is my job to stick up for my constituents, not for the banks, and that is exactly what I am going to do.
In my electorate of Denison people are doing it tough right now. Power bills have risen and they are going to keep on going up. A pensioner from Moonah wrote to the Mercury newspaper recently recounting how she had received a $900 winter power bill and to conserve energy she was only using two rooms in her house. That is no way to survive, let alone to live. The constituents of Denison are also paying more for other essentials like water and housing. They need a break, not another demand for more money from corporations raking in the profits. And it is not just people paying off mortgages who suffer from these rate hikes. It is also the businesses, whose customers have less money to spend, and the children, who see less of their parents, who have to work longer hours. It also includes young people trying to buy their first house and tenants whose rents rise with interest rates.
I am pleased to see that some communities are fighting back. I was delighted to lend my support to a push by the Glenorchy community to buy a franchise of its local Bendigo Bank to create a community bank that will return half of its profits back to the local community. I will do my bit. I have pledged to become a founding shareholder, and I have already opened an account into which I will deposit my electoral allowance. I applaud the shadow Treasurer for taking a stand of sorts with his ideas about reining in the banks. I see merit in the shadow Treasurer’s approach. Now we have the Greens’ commendable proposal in the bill that we are debating today, and again I see merit. Disappointingly, we have seen little from the government, except a vague promise of a plan some time soon. The Prime Minister stands on the world stage and complains that banks are ripping off Australians; but, so far, she has done nothing to stop them, and that is not good enough. Again, I remind the government that it is well behind time for action on the greedy banking sector and that I will support any sensible reform which reins it in.