JIM CHALMERS:
Today we welcome the first visit by a Chinese Premier since 2017. We welcome Premier Li on this really important visit. This is a significant step in the relationship and it’s a significant set of meetings for Australia and for China.
I’m looking forward to signing with the Vice Chairman Liu Sushe the Memorandum of Understanding on the Strategic Economic Dialogue that we agreed last year and we’re looking forward to engaging with Premier Li and his colleagues on this really important visit.
We believe that engagement is good for our people, it’s good for our economy and it’s good for our country more broadly and that’s what this visit is all about. We’ve made really encouraging progress stabilising the relationship with China but in a way which is consistent with our values and our interests. We are very pleased to have been able to stabilise this relationship and to see billions of dollars of trade restrictions eased as a consequence of this effort.
This relationship has no shortage of complexities, no shortage of challenges, but it’s a really, really important relationship for Australia. The Albanese Labor government believes you get more for Australia and its people and its economy when you engage meaningfully, where you speak up for your interests where that’s necessary but where you engage in the interests of our workers and our employers and our investors and our economy and our country more broadly and that’s why we’ve been able to make the progress that we have been able to make over the last couple of years.
So this is a really important visit. It’s a really significant step in the relationship. It recognises the key economic and broader relationship between Australia and China, Australians and the Chinese people, and we welcome Premier Li to Australia in that regard.
I’m also announcing today a suite of changes in the banking system as well. This is all about making it easier for Australians to find and follow better deals. This is all about making it a little bit easier for people to get the information that they need to find and follow better deals whether that’s in relation to mortgages or deposits or in other areas of the banking system.
We’ve received 3 really important pieces of work – 2 from the ACCC and one from the Parliamentary Committee led so ably by my colleague Daniel Mulino. One piece of ACCC work was done in 2020 and ignored by our predecessors. The second piece was commissioned by me last year and the third piece is this really important work by the Parliamentary Committee.
This is all about better information, better disclosure, and making it easier for people to find better accounts and better mortgages. It’s all about making it easier for Australians to find and follow better deals.
We know that Australians are under the pump and a big part of that has been higher interest rates, and so we want to make it easier for people to find the best deal that they can.
We also know when Australians are under the pump just how important our cost‑of‑living relief is in the Budget. In a little over 2 weeks’ time, there will be a tax cut for every taxpayer, there will be energy bill relief for every household, we’re making medicines cheaper, we’re providing assistance with rent and with student debt and in other ways as well.
We don’t just acknowledge and understand that people are doing it tough, we are doing something about it in the Budget and that’s why the cost‑of‑living relief is really the central part of a Budget which also invests in a Future Made in Australia.
We are managing the economy in the most responsible way, that means providing cost‑of‑living relief and fighting inflation and getting the budget in better nick without smashing the economy which we know is already soft and which is already weak. And here there’s a really important contrast between the responsible economic management you’re seeing from this Albanese Labor government and the absolute shambles that you’re seeing from Peter Dutton and the Opposition.
Peter Dutton’s a very divisive character, he leads a very divided party, and there are no details on his policies and he has no economic credibility and that’s why people are lining up to slot Angus Taylor from his own team, people who know, as I think others do, that Angus Taylor is not up to the job of being the Treasurer of this country, he’s not even up to being the Shadow Treasurer of this country, and that’s why his colleagues are lining up to slot him.
We’ll keep managing the economy in the most responsible way – cost‑of‑living help, fighting inflation, getting the budget in better nick, a plan for a Future Made in Australia and engaging with our region and with the world in the interests of our workers and employers and investors as well.
JOURNALIST:
Treasurer, are you effectively trying to regulate to help customers who simply don’t read the fine print?
CHALMERS:
We’re trying to make it easier for people to find better deals and to follow those better deals. We know that there can be vast differences between a good deal and a bad deal in the banking system and we want to help make it much, much easier for people to find those better deals.
We know when household budgets are under pressure and people are under the pump that every dollar matters, that’s why we’re providing cost‑of‑living help, and that’s why we want to make it a bit easier for people to find these better deals. Whether it’s in their deposit accounts or with their mortgages, getting a better deal can make a difference to household budgets, and we want to help people where we can.
JOURNALIST:
Well, how does the government plan to enforce these, I guess, changes with the banks?
CHALMERS:
A number of these changes are real changes and regulations. We will work closely with the banks and the financial system more broadly to bed them down. I think there’s a broad acknowledgement and acceptance following the great work of the ACCC and the Parliamentary Committee that we can do better here and we will, and that’s what these changes are about, and we will work with the banks and with the community more broadly to bed them down.
JOURNALIST:
Why didn’t you go as far as the ACCC wanted in forcing banks to actively prompt customers to switch to better rates?
CHALMERS:
I think we’ve struck the right balance here. Obviously, we took into consideration all of the ACCC recommendations and we prioritised the ones that we thought were the most important, and you’re seeing that in this package today.
Now this is not necessarily the end of the changes that we want to make to make life a bit easier for people in the banking system, but it’s an important set of steps that we are taking, initial set of steps responding to that good work by the ACCC and by Daniel Mulino’s committee.
JOURNALIST:
If some of the banks aren’t adhering to these changes, who do people report to?
CHALMERS:
We’ll make sure that the implementation of these changes are robust and that people have the ability to alert the government if they’re not happening. We work closely with the banks, with the peak organisations and with the regulators to make sure that this really important part of the economy is well regulated in the interests of the Australian people who are under the pump.
JOURNALIST:
Do you have any idea on how many Australians are stuck in a bad deal with their bank or how many you expect will switch when the new measures are in place?
CHALMERS:
Oh, it remains to be seen. We are realistic about these sorts of changes. We know that you need to implement them in a methodical and a considered way to make things a bit easier for people and we’ll see how we go and we’ll keep them under more or less constant monitoring to see if they need to be tweaked into the future but clearly the feedback from the ACCC and from the Parliamentary Committee but from the community more broadly is that the banks need to do much much better when it comes to disclosing changes to deposit accounts or mortgages, they need to make it much easier for people to switch mortgages, to find and follow a better deal, and that’s what these changes are about.
JOURNALIST:
And Treasurer, when do these measures actually come into effect and which one do you think will make the biggest difference because from what I can see, the onus will still be on the customers to chase up the banks on whether there is a better deal available.
CHALMERS:
They’ll be able to do that though on the basis of much better information. We want to make sure that the information that helps people find and follow better deals isn’t hidden and isn’t buried, and so we want to improve the information that is provided, we want to make sure that the disclosure is much tougher, the information is much clearer, and that it’s easier for people to find and follow those better deals. It will be very clear to us and to the regulators if and when that’s not happening so that we can make any tweaks that are necessary.
JOURNALIST:
Sorry, when will they come into effect?
CHALMERS:
We’ll bed these changes down as soon as we can. There’s a little bit more work to do on the implementation front, but we wanted to make sure that we indicated as soon as we’d come to a view on the changes we’re adopting from these important pieces of work to announce them. As always, there’s a little bit of work to happen now to implement them, we’ll implement them as soon as possible working with all of the interested parties.
JOURNALIST:
Morning. What are the changes?
CHALMERS:
So there’s a series of changes that we are announcing today. The first one is to make sure that banks tell customers when their interest rate changes on their transaction account or on their savings and deposit account. We’re improving the disclosure requirements for basic deposit products. We’re making sure that where there are these comparison websites that the relationship between the comparison website and the financial institution is properly disclosed and the way that they make those rankings and determinations are properly disclosed as well. We’re making it easier for people to switch loans by making sure that the forms, online and otherwise, are more easily accessible for people to make those changes. We want to make sure that we can improve how people are notified about the bonus interest rate offers that are available and when those introductory interest rate periods end, a lot of people sign up to an account on the basis of those introductory interest rates, and when they disappear or normalise, we want people to be notified of that, and there’s some more work as well that we’re flagging that the Treasury will do.
Another important piece of work today that we are flagging is that we will be asking the Council of Financial Regulators to look at the way that capital flows in our banking system to make sure that it’s not disadvantaging the smaller players, the smaller and medium‑sized players. We engage with them a lot. We want to make sure that our banking system is as robust and reliable as possible but we also want to make sure that the smaller players aren’t unnecessarily disadvantaged, so we’re also flagging a further piece of work, working with the regulators to see if more can be done on that front.
JOURNALIST:
What will the consequences be for banks that don’t comply?
CHALMERS:
There will be the usual suite of penalties but we expect the banks to comply. Frankly, these are not difficult changes for the banks to implement but they require a bit of a push from government and from regulators in order to do that. I fully expect that the banks and financial institutions will implement these changes. We want to make sure that people can find and follow those better deals, and we expect the banks to do their built.
JOURNALIST:
So I’m just still not quite clear about how this will actually be implemented. So, to me it sounds like there are many, many banks, if not most banks that already disclose a lot of this information when it comes to interest rates. My bank, for example, emails me every time my savings interest rate goes down or up.
So how will this actually be enforced? So is it kind of a prominence thing, you know, like so that things aren’t buried in terms and conditions, that kind of thing, you know, does it have to be, you know, a series of dot points, you know, directly communicated to customers as opposed to being, in like the product disclosure agreement, that kind of thing?
CHALMERS:
I think all of the above, Amanda, and what we’re talking about here is making sure that all of the banks and financial institutions hit a high standard and we implement and regulate these changes in the usual way.
We’ve got a robust system of banking regulation in this country, it’s one of our strengths. I meet regularly with the head of APRA, for example, as I have in the last week or 2, to make sure that the standards we expect, the high standards we expect from our banks and financial institutions are properly implemented and there are a whole range of ways that we have recourse if that doesn’t happen.
JOURNALIST:
And just quickly on China. Around Canberra there’s a huge amount of fencing, barriers going up for this visit of the Chinese Premier. Do you think that it’s fair on Australians who potentially are looking to protest on a range of issues when it comes to this Chinese visit to really have that sort of squashed, you know, potentially at the request of Chinese officials?
CHALMERS:
Well, first of all, I’m not going to second‑guess the people who make decisions to keep our local community safe when we have important visits like this. There are typically very well‑considered arrangements put in place when we have visits by people of the status and stature of Premier Li, and I’m not for one second going to second‑guess that.
The arrangements which have been put in place will be well considered. I think every Australian has an interest in making sure that our region is peaceful and prosperous and stable and secure, and that we’re engaging with important economic partners in the region to make sure that Australia is a big beneficiary of this important economic relationship. I think the security arrangements are determined by those who know what they’re talking about and I’m not going to second‑guess it.
JOURNALIST:
Just quickly on the Chinese Premier’s visit, is it going to be all pandas, or will we see any announcement about the removal of sanctions on rock lobsters?
CHALMERS:
Well, first of all, we should acknowledge that of the $20 billion a year or so of trade restrictions that we inherited when we came to office, almost all of those have been eliminated. There’s a couple of those which are remaining, as you rightly identify in your question, but the vast bulk of those have been eliminated and that’s because we’ve been prepared to engage and to engage in a way that doesn’t sacrifice our values or our interests. We speak up for our values and for our interests, but we engage in a meaningful way, and our economy is better for it as a consequence, and we’ve seen that in the way that those trade restrictions have been largely unwound.
I’m not going to pre‑empt the discussions that Prime Minister Albanese and the colleagues will have with Premier Li and his colleagues. I’m looking forward to signing the MOU on the Strategic Economic Dialogue with one of my counterparts in the Chinese system but obviously you’ll hear more about any other developments in and around the meetings themselves.
JOURNALIST:
Do you expect the government will confront Premier Li on questionable conduct by the Chinese military humanitarian orders?
CHALMERS:
What I would say about that is that we have found a meaningful way to engage which doesn’t sacrifice our values or our interests and we’ve made it clear on earlier occasions that we are prepared to speak up for those values and interests when that’s appropriate.
We don’t pretend that isn’t sometimes a difficult relationship to manage or a complex relationship to manage but we do believe that when you engage meaningfully with colleagues and counterparts in countries like China, then the ultimate beneficiaries of that are the people of Australia, their economy and their country more broadly. And so we disagree with the administration when we need to, we engage where we can and I think we’ve seen some of the fruits of that, certainly in terms of the economy over the last couple of years.
JOURNALIST:
Is this one of those instances though where you need to disagree, or is it not?
CHALMERS:
Well, we’ve raised our concerns already about the incident that you refer to, very dangerous incident that you refer to, and on earlier occasions as well. We’re not reluctant to do that when that’s appropriate and when that’s necessary. We do that in the context of engagement which is important to us, but which doesn’t sacrifice our values and interests and people can expect that that will be the way that we’ll continue to manage what is sometimes a complex and difficult relationship.
JOURNALIST:
Just very, very quickly, Treasurer, thank you, I’m thinking on the fly. Just on the changes to banks when it comes to interest rates, can you just talk us through how big the pool of money is that Australians actually have in those kinds of savings accounts [INAUDIBLE].
CHALMERS:
I will try and provide you some of that data which is released by other agencies, regulators and others but clearly people have got a big interest in their deposits and in their mortgages, particularly in the context of savings rates coming down substantially and interest rates having gone up since before the last election and so we want to make sure that as people make these decisions, often marginal decisions about their savings accounts or their mortgages that they do that armed with the best possible information, and the banks are doing their bit to make sure that people can find and follow better deals. To the extent that some of that other data exists, we’ll see what we can dig up for you, Amanda. Thanks very much.
JOURNALIST:
Thank you.