Federal Labor has announced that when next in government it will hold a Royal Commission into misconduct in the banking and financial services industry.
“This is an important decision that was not taken lightly – it’s been made after careful consideration over an extended period of time”, Federal Opposition Leader, Mr Bill Shorten said.
According to Labor, the sector employs almost half a million people and it’s the fastest growing in the Australian economy.
“Australia has one of the strongest banking systems in the world and Labor wants to make it even stronger”, Mr Shorten claimed.
“The fact is, the confidence and trust in the financial services industry has taken a huge hit over an ongoing range of scandals and high profile consumer rip offs”.
The Opposition believes that the Commission is needed to ensure Australians will have confidence in their banks and financial institutions, ‘to sweep away the doubt, to uncover and deal with unethical behaviour that compromises that confidence’.
In announcing the Royal Commission, Mr Shorten was clear to the reasons. “Retirees who have had their retirement savings gutted. Families have been rorted out of hundreds of thousands of dollars. Small business owners who have lost everything. Life insurance policy holders denied justice”, he said.
“There are literally tens of thousands of victims, if not more. Enough is enough”.
“Every Australian uses a bank and every Australian relies on the integrity of the banks – we need to restore that trust and confidence”, Mr Shorten stated.
After a damaging series of Liberal Government cuts to ASIC, Federal Labor believes that getting to the bottom of the wide-ranging and severe issues uncovered in recent years has become beyond the capacity of regulators.
A Royal Commission into the financial services industry will examine issues such as:
- how widespread instances of illegal and unethical behaviour are within Australia’s financial services industry;
- how Australia’s financial services institutions treat their duty of care to their customers;
- how the culture, ethical standards and business structures of Australian financial services institutions affect the behaviour of these institutions;
- whether Australia’s regulators are really equipped to identify and prevent illegal and unethical behaviour;
- comparable international experience with similar financial services industry misconduct and best practice responses to those incidents; and
- other events as may come to light in the course of investigating the above.
The proposal for a Royal Commission into Australia’s Financial Services Industry has been costed by the independent Parliamentary Budget Office at $53 million over two years.