This week the Prime Minister announced that there would be a Royal Commission into the banking sector. The highly controversial decision was basically forced on the government, with some seeing it as heading off a move in the Senate where the junior Coalition partner, the Nationals, were prepared to combine with the Greens, Labour and other crossbenchers to force an inquiry to be held.
Despite only a week ago re-affirming the coalition was not interested in a royal commission into banks, the government faced the prospect of being outvoted in parliament because of threats to cross the floor and vote with the opposition by “rogue” elements from within the coalitions own ranks.
Adding a spicy flavour to the decision was that it came after a note was sent from the chiefs of the 4 big banks to the Treasurer asking for it.
The email stated: "Our banks have consistently argued the view that further inquiries into the sector, including a royal commission, are unwarranted…however, it is now in the national interest for the political uncertainty to end."
On the one hand, some may find it comforting that that banks are able to tell our elected leaders what is in the national interests, as looking for direction in this area from our political leaders has proven to be an exercise in futility. On the other hand, it did provide the opportunity for the Prime Minister to offer up a valuable insight into the machinations of the intimate workings of government. When asked if this announcement constituted a backflip on what he said a week ago, the former barrister and merchant banker offered up “a government's policy remains the same until it is changed”.
Only the sharpest minds can even contemplate the meaning of that statement.
Truly insightful stuff.
In an interview on Sunrise, Treasurer Morrison told host David Koch that the government will ensure that banks are held accountable and described the inquiry as “regrettable but necessary”. So, they have been forced into making the tough decision and the royal commission into banks is on its way.
Be assured that we will to keep you updated with our take on proceedings as more details of the commission come to light.
Watch this space.
This information is current as at 01/12/17 This article has been prepared by Heart1Stop, a social media brand owned by Heart Mortgage Services and Heart Financial Advisers. The information contained in this article is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The views expressed here are not those of Heart1stop, Heart Mortgage Services, Heart Financial Advisers, shareholders, directors or staff and associated contractors and business associates. This article has been prepared without taking into account any person’s objectives, financial situation or needs. Because of this, you should, before acting on any information contained in this article, consider its appropriateness, having regard to your objectives, financial situation or needs. Any taxation information contained in this article is a general statement and should only be used as a guide. It does not constitute taxation advice and is based on current laws and their interpretation. Each individual’s situation may differ, and you should seek independent professional taxation advice on any taxation matters. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. It is not the intention of Heart1Stop or Heart Mortgage Services and Heart Financial Advisers that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party of Heart1Stop or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties ("Third Parties") who are not related to Heart1Stop. These links are provided for convenience only and do not represent any endorsement or approval by us.