The announcement follows a letter earlier this morning penned by the chairmen and chief executives of the four major banks calling on the government to establish an inquiry to end uncertainty and speculation.
“Ongoing speculation and fear-mongering about a banking inquiry or royal commission is disruptive and risks undermining the reputation of Australia’s world-class financial system,” a spokesperson from prime minister Turnbull’s office said.
“The government has decided to establish this royal commission to further ensure our financial system is working efficiently and effectively.”
The inquiry will examine the conduct of “banks, insurers, financial services providers and superannuation funds (not including self-managed superannuation funds),” the spokesperson said.
It will also involve an examination of how well-equipped regulators are in identifying and addressing misconduct, but will not “inquire into other matters such as financial stability or the resilience of our banks”.
“This will be a sensible, efficient and focused inquiry into misconduct and practices falling below community standards and expectations,” the spokesperson said.
“Most Australians are consumers of banking and financial services, and we all have the right to be treated honestly and fairly by banking and financial services providers.
“Trust in a well-functioning banking and financial services industry promotes financial system stability, growth, efficiency and innovation over the long term.”
The announcement comes a week after Queensland Liberal National Party senator Barry O’Sullivan announced he intended to introduce a bill calling for a commission of inquiry into the banking industry.
Obviously wasting $130 million on a plebiscite was not enough for the spineless Malcolm. Now we are going to waste more time and tax payer money to basically come up with nothing more than what we already know.
The real question is does anyone really think it will bring about any change at the business practices at the big end of town?
I think this is clear evidence that the clowns are running the circus – sad reality is any RC and this one more than most is ideologically driven – it remains to be seen if the lift the veil on ISN behaviour and payments to union mates
If the enquiry targets the boards of the banks, insurance companies and the industry funds, then it is a very good idea. It may well be the time for the chiefs to be slaughtered as opposed to the Indians.
Oh! how cute, and how well-behaved and polite of young Malcolm. He waited and waited for permission from the banks in the form of a letter from their CEOs and Chairmen before calling the Royal Commission. Now, that’s a well-behaved Malcolm. Good boy.
And how is the bank’s conflict of interest between their managing of funds and advising on funds going to be handled by a government who is also riddled with conflicts of interest by taking “donations” from these same bankers? We need to seperate and stop the conflicts and when bankers break the law throw their (the bosses not scape goats) assess in jail like Iceland did. And do not use my money to support their profits unless you negotiate a better deal. Let them collapse next time and then buy them out at bargain prices!
This is great news. I have already started writing my submission asking for a review of the conduct of the FPA and it’s payments from Banks, in return for influencing the direction of advice as per their professional partner program and then bundling up these payments as “members fees””.
In the same manner the Government has legislated a separation of advice from product, I will suspect product payments to bodies that claim to be representing the needs of consumers will become clearly separate. It won’t be that bad for them as in the same manner there is an exemption for education so will an ability to remain for the banks to sponsor FPA events.
Agree 110%. They’re going to come out looking smelly. Very smelly.
Woohoo! Bring it on!
A royal commission. Another one. I recall these costing lots of money, our money, lots of ceremony and evidence and findings so here we go again. Our industry has had several inquries, going some time back. Wallis, Ripol, Murray among the more noteables along with copiuos legislation strangling the industry along with changes in corps law, FOFA, LIF all costing lots and lots and lots of money to no effect. And now we have a royal commission. These have cost money as well. Aboriginal deaths in custody 1991. Money spent with nothing done. More foolish nonsense. Here’s a thought. Jail for the wrong doers. Yes. After all the loss of ones liberty I’m sure will correct bad behaviour. Lets start at the top and make this wide ranging. From executives and CEO’s down. Superannuation Trustees also including those from the Industry Super Network. I recall when Wells Fargo, the giant American Financial Services company CEO John Stumpf was questioned on bad behaviour in a congressional inquiry, the words criminal indictment when mentioned being applicable to Stumpf sent severe shivers down the spine of executives whose bonuses and outragreous remuneration was brought into the spotlight. Yes. Jail is the answer. Not another damn time wasting foolish Royal Commission. If we must have this though, lets also have the Industry Funds, Banks, Insurers, Direct Insurers, in fact EVERY form of financial services brought into the spotlight. Why you say? When Bill SHorten was Financial Services Minister in 2011, he passed laws governing payday lenders to enable them to thieve from the most vulnerable in society. His hypocrisy and that of Labors is just that . BS – (Bill Shorten). As for the Libs, they have simply forgotten about the business owners and both have forgotten about the one thing that matters to all of us. Australia. Sad.