EMMA ALBERICI:
Kelly O'Dwyer many thanks for your time.
KELLY O'DWYER:
Great pleasure to be with you, Emma.
EMMA ALBERICI:
What's the point of an inquiry where a bank boss visits the Parliament for half a day and MPs get roughly 20 minutes each to ask questions?
KELLY O'DWYER:
Well the point is this – it is very, very important that the banks are accountable to the Australian people through the Parliament. They have a very important role. As bank CEOs they are responsible for the banking system in this country and more broadly our financial system. And Australians need to have confidence in our financial system and this is one of the transparent ways that they can answer questions from representatives of all political parties in the nation's Parliament.
EMMA ALBERICI:
Are you convinced that these couple of days are going to instil confidence in the community with the banks?
KELLY O'DWYER:
Well look, it's but one mechanism that I think can help to restore some of the trust and confidence that has been lacking in the financial system.
EMMA ALBERICI:
And you think this is going to do it?
KELLY O'DWYER:
Well, I think this, as I said, one mechanism. There are a number of other mechanisms. When we first came into government, the Turnbull Government and the Abbott Government conducted a financial system inquiry. That was a root and branch review of our financial system. This was something that the Labor Party opposed at the time. They said it wasn't necessary. We did it anyway because we wanted to make sure that our financial system, which represents about 10 percent of our economy, that it was robust and strong and that we could make it even stronger with prudent measures and reforms putting those in place.
EMMA ALBERICI:
But also when - sorry to interrupt you, but also in 2014, Tony Abbott took $120 million or attempted to take that amount of money out of ASIC, which was the watchdog responsible for regulating the banks.
KELLY O'DWYER:
Well the Turnbull Government has actually put more than $127 million into ASIC -
EMMA ALBERICI:
Well put it back in. You'd have to admit this is actually just restoring money that was taken out by the Abbott Government?
KELLY O'DWYER:
Well has strengthened the powers of ASIC, has given it new abilities to intervene with product intervention powers, has made sure that it has got data matching capabilities, so that not only can it detect wrongdoing, but it can intervene before harm actually occurs. And I think that's one of the great take-outs from a lot of consumers who have actually been hit by financial crimes and financial misconduct is that they want to make sure that we prevent harm from occurring. One other thing that they want to see happen, and they want to see it happen now, not three years from now, is to make sure that they get access to justice in a timely manner. They get access to compensation, that they can resolve their issues, and we have convened an expert panel to give us advice on this one-stop shop, whether it's a tribunal or an ombudsman, to make sure that that can occur.
EMMA ALBERICI:
OK, well that was discussed today and the ANZ chief Shayne Elliot said it was a good idea to set up a tribunal where consumers could have their complaints heard. How quickly could the Government set that up?
KELLY O'DWYER:
Well, we're expecting the recommendations on how this ought to look by November of this year. The final report will come in March. We believe it's very important that consumers have a say in how this looks. We've currently got a financial ombudsman service but we've also got a number of other mechanisms, some of which overlap and which mean that people aren't always sure of the jurisdiction and they don't always necessarily get access to compensation.
EMMA ALBERICI:
So if we had this one-stop shop, what sort of powers could such a tribunal have? For instance, could it recommend criminal action be brought against a bank or one of its employees? Could it issue significant fines for bad behaviour?
KELLY O'DWYER:
The regulator can currently do that right now. It can actually ban people who have been found to have misconduct.
EMMA ALBERICI:
Pardon the interruption. I think the reason you're looking at this one-stop shop tribunal model is to be more swift in action and find redress more quickly and more simply and more cost effectively.
KELLY O'DWYER:
Well, it's also - let me say this. It's for those consumers who have got a dispute with let's say the bank, and instead of the issue dragging on and on, because their claim is so significant, they have often been told that they need to go through the court system. What we're saying is that's not always the best mechanism to deal with these complaints. They can be dealt with in a very timely manner, through the right mechanism where they can get their matter heard and examined independently and potentially have access to compensation. So that's the mechanism that we're looking at delivering. Not three years from now, but now.
EMMA ALBERICI:
It took nine days, we heard today, for the ANZ to pass on the latest interest rate cut and that delay meant the bank reaped some $7 million over that period. Is there anything that the Government could do to legislate more a faster response from the banks such that that money ends up in the accounts of customers rather than in the bank's coffers?
KELLY O'DWYER:
I certainly know from the tribunal today, through the discussion of the inquiry today, that there were house members that asked questions of the ANZ about their credit card interest rates and they actually extracted a commitment from the ANZ to actually examine the interest rates that currently apply. I'm no apologist for the banks. At the end of the day, the banks make decisions about what they pass on and they need to justify that to the Australian people. We have competition within our banking sector, perhaps we could have even more and the Government will always look at those measures that will allow, for instance, better portability between banks if people actually want to switch and people want to move. And again, these are issues -
EMMA ALBERICI:
Would that involve getting rid of some of the fees that are involved in doing that at the moment?
KELLY O'DWYER:
This is something the inquiry is examining right now and the Government will look very seriously at the recommendations that the inquiry makes. This is part of the benefit of actually having this inquiry over 3 days.
EMMA ALBERICI:
I want to get your view on the decision by the NAB to stop donating to political parties and the ANZ boss today indicated that his bank is inclined to go the same way. What will that mean for the Coalition given last year the NAB gave you close to $250,000 and the ANZ $100,000?
KELLY O'DWYER:
It's a matter for all corporates, all trade unions, any individual what they contribute to any political party.
EMMA ALBERICI:
The banks are significant donors though, particularly to the Liberal Party.
KELLY O'DWYER:
Well, actually, they contribute money to the Labor Party as well. They don't just contribute to one side of politics.
EMMA ALBERICI:
Not in the same quantum they give you.
KELLY O'DWYER:
I think you will find depending on which returns you look at, and I'm no expert in this area because it's not something I'm directly involved in but I think you will find actually it's pretty even, and it will depend on, I suppose, the organisation that actually makes those contributions. But frankly, it's a matter for them. It's a matter for them to justify their own policies and if they make a decision to do that well, it's entirely at their discretion.
EMMA ALBERICI:
Earlier this year, the NAB sponsored a fund-raising event you held in the lead up to the election, the re-election for your seat of Higgins. Did that money influence your decision to reject the idea of a royal commission into the banks?
KELLY O'DWYER:
Well, I've got to say, I think that that's a bit of a grubby question because, of course, I'm not directly involved in the fund-raising. I have a supporters group, like most other parliamentarians, and I get sponsors to those supporters functions. It's a decision that's made by the fund-raising organisation, it's not a decision that's personally made by me.
EMMA ALBERICI:
With respect, I think the audience wouldn't think it's a grubby question. I think they would think it's entirely legitimate to ask you that as the minister responsible for the banks, isn't there, at the very least, the appearance of a conflict of interest to accept direct sponsorship from a big bank for one of your events while you lead the debate about whether or not to hold a royal commission into the banks?
KELLY O'DWYER:
Well, I can say to you that it has no influence whatsoever on my decision making. I look at all issues on their merits, as you would expect me to do. I have a duty to do that and I do do that. Look, I come with a wealth of experience into my role. I have in fact worked at a bank. I have also been a merchants and acquisitions lawyer and I've worked for Australia's greatest Treasurer in Peter Costello which I think uniquely places me in a position to be able to deliver on the reforms that Australian consumers demand and expect in this sector, which are necessary right now.
EMMA ALBERICI:
Now, everyone on that Parliamentary committee today, I think, bar none, mentioned they had more questions than they had time to ask. Is there an opportunity to extend this committee's inquiry?
KELLY O'DWYER:
Well, obviously this is a matter for the committee, but I note that they're using a precedent that has been used for the regulators that they oversight, the Reserve Bank, ASIC, APRA, it's usually a three year hearing - a three hour hearing, not a three year hearing, and they get to table questions if they've got further questions and have follow up questions. So I'm sure they will follow that very, very similar process because that's the precedent that's been set.
EMMA ALBERICI:
I, too, have always got more questions than the time allotted but for now, unfortunately, we are out of time. I look forward to speaking to you again Minister. Thank you.
KELLY O'DWYER:
Great to be with you.