PARTICIA KARVELAS:
Kelly O'Dwyer is the Minister for Revenue and Financial Services. Kelly O'Dwyer welcome.
KELLY O'DWYER:
Great to be with you Patricia.
PARTICIA KARVELAS:
Why now? What is it about the banks requesting a Royal Commission that's made the difference?
KELLY O'DWYER:
Well there has been a lot of ongoing speculation, a lot of fearmongering about the need for either a commission of inquiry or a Royal Commission and it's got to the point now where it's actually having an impact on the reputation of our world class financial system. We know this because obviously there have been conversations between the Treasurer and the Chair of APRA, and the Treasurer and the Governor of the Reserve Bank of Australia and we do have a world class financial system. We have one of the world's best prudentially regulated and oversighted systems and we need to make sure that everyone has confidence in that system and so the Government has taken charge of this situation and has announced very sensible terms of reference and we'll be having a Royal Commission into the banking, superannuation and financial services sector.
PARTICIA KARVELAS:
The banks write a letter to the Government and then the Government announces a Royal Commission. That timing seems rather odd. Were you just responding to the banks? Why is it that the banks say something and the Government jumps?
KELLY O'DWYER:
Well no, the Government hasn't jumped because of anything that the banks have said. As I said to you before, Patricia, obviously we have received advice in relation to this now becoming a much broader issue. The Government's always said we're going to act in the national interest of Australia and its people, and our economy. We have a duty to do that. We have done a calculus and the calculus is such that right now it is causing more damage to not do it than to do it. So the Government is getting on with it, it's not allowing a commission of inquiry that would potentially not be properly focused. It is instead putting forward very clear terms, headed up by either a retired judge or a current serving judge, and it will be appropriately resourced, 75 million dollars toward it, and it will conclude within a 12 month period.
PARTICIA KARVELAS:
The Government has previously argued that it would be a lawyer's picnic. Is it still a lawyer's picnic?
KELLY O'DWYER:
Well look, there's no question that there'll be a number of lawyers involved and one of the reasons that the Government didn't see a reason to do this before now is because of course we have been focused in dealing with issues of misconduct, very directly and very practically. What you would know, Patricia, is that next week, in the Senate, the Government will be debating legislation to establish the Australian Financial Complaints Authority. This is the new one-stop shop that is a game-changer for consumers and small business being able to access justice in a timely manner with an independent arbiter and, where it's appropriate, they'll be able to access compensation, in some cases up to $1 million.
PARTICIA KARVELAS:
Do you know what it looks like for the Government to be announcing something that it says is a bad idea? I mean it seems pretty weird to be announcing a Royal Commission and then saying we think it's regrettable that we're announcing a Royal Commission. I don't think I've seen anything like it.
KELLY O'DWYER:
Well, as I said the Government's been very focused on dealing with these issues very practically. We have strengthened the powers of the regulator, the conduct regulator ASIC, we put in place a levy mechanism to make sure that they're appropriately resourced, we've lifted the standards of financial advisers and put in place a proper authority to deal with that…
PARTICIA KARVELAS:
But now you've announced a Royal Commission that you clearly don't believe in.
KELLY O'DWYER:
Well what we've done, is we have been very clear in taking charge of this situation. We can't have ongoing speculation, we can't have political brinksmanship and we cannot have continued fearmongering that would undermine our reputation of having a world class financial system. It cannot continue and the Government has made the decision, the Cabinet made the decision this morning, the Prime Minister and the Treasurer announced it today in a press conference, that we have very clear terms of reference that are going to look into our banking, superannuation and financial services sector to ensure that people can continue to have confidence in it and where there are issues around misconduct, where there are issues around the need for potential reforms or changes that the Commissioner will have the full ability to make recommendations to the Government about those matters. But critically, this will not delay the very important reforms that the Government has already delivered or will continue to deliver with the legislation in the parliament.
PARTICIA KARVELAS:
Do you accept now that you've announced this Royal Commission that perhaps you should've done this earlier? I mean you've left this situation reach crisis point. The Government has announced this after a letter from the banks and also after threats that basically you were going to be rolled by your own party. This isn't just about the Labor Party, your own party is divided on this issue. Do you accept that you've taken too long to act and allowed it to become a crisis?
KELLY O'DWYER:
Well I'm certainly not going to take any criticism from the Labor Party on this particular point because of course Bill Shorten was the financial services minister when we had the collapse of Trio, when we had Storm, and when we had the issue…
PARTICIA KARVELAS:
But my question is about whether you've waited too long? I'm not asking you about the Labor Party. Have you waited too long?
KELLY O'DWYER:
No but the point I'm making is at the time, there were calls for a Royal Commission then and they were strongly resisted by the Labor Government of the day. Now that they're in opposition, they saw some political advantage in actually pursuing this and the Government, if we had announced a Royal Commission at the time there were the first calls of it, we would not have had the reforms that are currently now before the parliament that will give people access to compensation and access to justice, which will be achieved after the next sitting week.
PARTICIA KARVELAS:
So you think it's OK that you've waited this long?
KELLY O'DWYER:
Well I'm telling you that the Government will always act in the national interest…
PARTICIA KARVELAS:
So you honestly don't have any regrets about the way this issue has been managed?
KELLY O'DWYER:
We will take advice from the Chair of APRA, from the Governor of the Reserve Bank of Australia and we will make appropriate decisions that suit the times. I mean that is what we have a responsibility to do, that's the responsibility of any prudent and sensible government.
PARTICIA KARVELAS:
John Howard called a banking Royal Commission an act of rank socialism. Do you agree with that characterisation?
KELLY O'DWYER:
Well look as I said, we have taken advice on this issue, we're not going to put at risk our world class financial system, we're not going to allow further reputational damage to be done or undermine our system any further.
PARTICIA KARVELAS:
Is it socialism? Answer my question Kelly O'Dwyer, is it socialism?
KELLY O'DWYER:
Of course it's not socialism but the Government has made a decision on this particular issue because of the advice that we have received and because of the potential risk to undermining the reputation of our financial system. We're doing it in a sensible and prudent manner. We do, though, and I should just emphasise, have a very strong and stable banking system that is the envy of the world. I mean we know this as well because we did conduct the Murray Financial System Inquiry that looked at our financial system as a whole. This was actually strongly resisted when we came into government by the Labor Party, we did it anyway. And people can have confidence that we have appropriate prudential regulation in our system. So there are no questions around that. But what we're looking at here, with this Royal Commission, is whether or not there are issues around culture in our banking, superannuation and insurance sectors, and, if there are, whether we need to have any further reforms beyond what the Government has already done in order to address them.
PARTICIA KARVELAS:
I want to move to the issue of same-sex marriage because it's coming to the House next week and you have been a staunch supporter of this law reform. The Prime Minister is supporting the Attorney-General's amendments to the same-sex marriage bill in the House. It would allow civil celebrants to refuse gay weddings. Do you support that?
KELLY O'DWYER:
I haven't actually had the opportunity to look at his amendments and I would want to look at them in detail but let me say this Patricia. I am a strong supporter of a change to the marriage act and I do strongly support the bill that Dean Smith has brought into the parliament. I do think that it's very important that this bill is passed before Christmas and I think the Australian people were very, very clear in what they have said to the parliament, which is get on with it. I also believe as a Liberal it is important to protect religious freedom but I don't believe that involves discriminating, putting in place new forms of discrimination against individuals simply because they are part of a same-sex couple so I don't support that.
PARTICIA KARVELAS:
All of this has played out in the Senate as you know, so we already know what the debate is, it's just going to be had now in the House. So we know, for instance, that Simon Birmingham, Marise Payne, other Liberals, your colleagues voted against all of these amendments. Will you also be voting against all of those amendments like those colleagues did?
KELLY O'DWYER:
Well you are assuming that the same amendments are going to be brought forward Patricia and the one thing I have learnt about politics and about the parliament is that what you think might happen doesn't always happen. There may in fact be different amendments that come before the parliament.
PARTICIA KARVELAS:
OK can you just give me an indication if you're likely to want to keep the Dean Smith bill unaltered?
KELLY O'DWYER:
I think it's a very strong bill. That is my view. I would need to be persuaded as to why it required further amendment. I know that we are looking at broader protections within our anti-discrimination laws for religious freedoms overall and a review is being conducted by Phillip Ruddock and I think it is appropriate to look at that holistically. I don't believe in creating new forms of discrimination for same-sex couples so, look, I will always do my colleagues the courtesy if they have amendments and no one's approached me with any amendments at this stage. I will always do my colleagues the courtesy, as you would expect, in looking and listening to what they have to say, but I would…
PARTICIA KARVELAS:
But your electorate is a very strong supporter of same-sex marriage so what's your message to them? Because they're worried about some of these amendments, including some of the ones the Prime Minister supports.
KELLY O'DWYER:
I would say that I think my message has been very consistent on this all along. I absolutely support a change to the marriage act, I'm very supportive of Dean Smith's bill. I would need to see amendments that would persuade me to make a change to that. No one's put any in front of me so I suppose that would be my message. I haven't seen any but I always do my colleagues the courtesy of actually listening to what they have to say. I'm happy to come on your program, Patricia, if somebody does actually put on in front of me…
PARTICIA KARVELAS:
But we know which ones are in front of you because the Prime Minister is supporting the Attorney-General's amendments and we know what they are and he said this on the record they have confirmed this. You're not persuaded by those amendments?
KELLY O'DWYER:
No, I haven't been persuaded by those amendments.
PARTICIA KARVELAS:
Kelly O'Dwyer, thank you so much for joining us.
KELLY O'DWYER:
Terrific, thank you.