Treasurer Josh Frydenburg was absolutely right about one thing in his measured and somewhat equivocal response to the findings of the banking royal commission. He said the banks being sorry is not good enough; they now have to set about changing their culture.
But saying sorry is a good start. Anna Bligh from the Bankers Association was very contrite and promised us they wouldn’t do any of it again. Frydenberg simply couldn’t swallow his or the Morrison Government’s pride. He was asked three times in media appearances on Monday if in light of the evidence and findings of the royal commission whether the Liberals were right in opposing setting it up for so long. His answer: “Like I said we can debate for hours Labor’s failure when they were in office.”
Maybe he thinks that if he did admit the government should have acted earlier it would only draw attention to a willful blind spot when it came to the banks and financial institutions. His finger pointing at Labor only prompts an examination of the record. True, Bill Shorten as Financial Services Minister did not set up a royal commission after the collapse of Storm Financial. The Labor leader says it is because he took the banks at their word. But by 2016, he saw that his trust and the trust of the nation was completely misplaced and joined the Nationals and the Greens calling for a thorough inquiry with all the powers needed and the ability to shame through public hearings.
Labor also introduced reforms to the way financial advice is given; the so called FoFa or future of financial advice reforms. The Abbott Hockey Government set about dismantling those changes when it caved into pressure from the banking lobby; changes that Commissioner Hayne now shows were completely necessary.
Perhaps with an eye to his legacy or to embarrass his successor Scott Morrison, dumped prime minister Malcolm Turnbull admits he got it wrong. He says the powerful inquiry should have been held 18 months earlier. It was widely reported that as prime minister, Turnbull faced huge resistance from then treasurer Morrison right up until cabinet finally agreed to call one.
The tight timeframe now means the government has run out of time to legislate any of the recommendations before the May election. Parliament is sitting for only 10 days and won’t be able to get back to real work till July.
Turnbull says there were some examples of wrongdoing that came out in the royal commission that shocked him. He says what the inquiry has done is to provide “shock treatment to ram home the need for cultural change”.
Retiring Nationals senator John “Whacka” Williams, who was relentless in his call for the inquiry, now wants criminal charges laid in light of the evidence and he says a voluntary code of conduct for the banks is not good enough. He is urging the government to legislate such a code.