SUBJECTS: Bank penalty fees, Auditor-General's report, political donations
JOHN BARRON:
The Federal Minister for Financial Services, Chris Bowen, thinks the banks should go further; he joins us now. Minister, good afternoon.
CHRIS BOWEN:
Good afternoon John, good to talk to you.
BARRON:
What other fees do you think need attention?
BOWEN:
Well the first thing to say is that I think NAB and Westpac and St George, today, deserve to be congratulated for what is a step in the right direction. Westpac has taken a slightly different approach to NAB; they have applied their reduction to a broader base, but kept a charge in place. We think, across the board that the other two banks, including NAB, need to be looking at credit cards and other fees and charges that have caused some concerns, like exit fees on mortgages for example, which impact on people who are thinking about moving their home loan.
So there is more to do, but credit where it is due; this is a step in the right direction from these two banks.
BARRON:
What do you think though of that language, 'encouraging responsible banking practices by keeping a penalty fee'? That's the sort of paternalistic approach that banks used to take 30 or 40 years ago isn't it?
BOWEN:
I don't have a problem if a bank decides to have a price signal to say that it is important to have enough money in your bank account to pay any regular liabilities. Now banks need to recognise - and I think they have started to recognise – that in many cases, it is not the consumers fault. There pay may have been delayed slightly or a bill has come out a day early, and therefore it is not the consumers fault; in some cases it is. So a price signal is not something I have a problem with, providing it is reasonable and appropriate. Now $9 is a lot better than $45 and is heading in the right direction and obviously there are still issues over whether it reflects costs; it is a step in the right direction, which I welcome.
BARRON:
Do you agree with Choice that there is no justification for banks to charge fees for credit card accounts given that they are already charging interest on those accounts?
BOWEN:
I think credit card accounts should be treated similarly to other bank accounts, and that there should be an appropriately small fee in place, so I would agree with Choice to that extent, that there is more to do.
BARRON:
Now onto a separate issue Minister, we are told that the Auditor-General's report into the Godwin Grech/Malcolm Turnbull fake email ute saga is going to be released tomorrow. Any predictions on what that is going to find and what it is going to mean, perhaps, for Malcolm Turnbull's leadership?
BOWEN:
Well, Mr Turnbull was very quick to claim that the Prime Minister and the Treasurer of this country had lied and had used their offices to support an individual. That claim lies in shreds and unless he has provided a justification, some evidence, for that claim, to the auditor-general then his position - as we have said for some time – is completely untenable.
The Leader of the Opposition actually holds a very important position in Australia; he's there to hold the government to account. And when a Leader of the Opposition makes an accusation, it's important that the Australian people can take his claims at face value. They no longer can when it comes to Mr Turnbull, so his position is untenable and he should take the opportunity of the release of the auditor-general's report to come clean about what role he played with Mr Grech, in the lead up to that Senate hearing; what was discussed at the meeting, and what other involvement senior Liberals, including Senator Abetz, had. Unless he does that and unless he provides some sort of justification for those outlandish claims he made, then his position is untenable.
BARRON:
The ute gate part of that saga, of course, plays into this ongoing debate in Queensland now about political donations, from business, lobbyists and so on. Malcolm Turnbull today said that he would like to see campaign finance reform and let only individuals donate to political parties, not companies or unions. Would the Labor Party give up on taking money from the union cash cow if the Liberal Party stops taking money from the business community?
BOWEN:
Well the first point to make here is Mr Turnbull's breathtaking hypocrisy. We put through a bill, through the parliament, to stop the tax deductibility of political donations. Mr Turnbull opposed it and fought against it, tooth and nail, and now he comes out and says it might be a good idea to ban them all together, when he wouldn't even support ending their tax deductibility.
On the more general issue, there is an important point to make here; it's very easy to say 'all political donations should be banned' or certain types of donations should be banned. What we don't want to get to is a situation where only very wealthy people can run for parliament; where you can only run for parliament if you 'self-fund' your own campaign. It's important that people, who are making a political argument, in a democracy, are able to accept donations from those who support them making that argument, and you don't have to independent wealth to prosecute that case. That's a complaint you hear regularly about the US political system; it's not a complaint you hear about here, because we don't have that problem. So I think when tinkering with political donations it is very easy to go for the knee-jerk reaction and say it all should be banned but there is a real issue of the health of the Australian polity here, and donations have a role to play in that.
BARRON:
Chris Bowen thanks very much for your time this afternoon.
BOWEN:
Great pleasure.