E&OE TRANSCRIPT
TELEVISION INTERVIEW
ABC AFTERNOON BRIEFING
MONDAY, 19 AUGUST 2019

SUBJECTS: Government dragging its feet on Banking Royal Commission recommendations; Restoring confidence in the finance sector; Public service review; Pacific Islands Forum; Alan Jones’ comments on Jacinda Ardern.

PATRICIA KARVELAS, ABC: The Treasurer Josh Frydenberg has revealed an implementation roadmap around 54 recommendations from the Royal Commission – looked of course into banks and the banking sector. So he said today that more than a third of the Government’s commitments in response to the final report will have be implemented or will have legislation before Parliament before the end of the year. This is not satisfactory to the Opposition and I am joined now by the Shadow Treasurer, Jim Chalmers. Jim Chalmers, welcome.

JIM CHALMERS, SHADOW TREASURER: Hi Patricia, thanks.

KARVELAS: So the Treasurer Josh Frydenberg wants to have thirty per cent of those changes implemented this year and the rest by next year. You've been critical of the timeline. I know Labor has done a bit of work on the Royal Commission response. What changes should have been made by now in your view?

JIM CHALMERS, SHADOW TREASURER: First of all Patricia I think it's worth pointing out that the Government received the Royal Commission report more than six months ago now and all we got today was another timetable and another message to victims of banking misconduct that they have to wait another 15 months, at least, before the recommendations are implemented.

Today was not especially significant except for this point: the Government's been dragged to this position - they've been embarrassed into it - because increasingly people have worked out that they're not serious about implementing the Banking Royal Commission recommendations. Now in the absence of any genuine action they come out with a timeframe which costs another 15 months of people's time and I think a lot of people around the country not just victims of banking misconduct but the broader Australian community are wondering why after two years of resisting the Royal Commission it's now going to take the Government two years to implement its recommendations.

KARVELAS: The Treasurer says this is complex legislation and it's important to get it right. Some changes have been legislated and there was also a Federal election, of course, in between. Do you accept that it's worth taking the time to get it right?

CHALMERS: Even if that is true Patricia in some cases for some issues, the Government has wasted six months before they even got cracking on it. The point that we're making is they received it in February, they went through the election pretending to care about these issues. They've barely said a peep about it since then until some good journalistic work and some pressure from the Labor Party and the broader community shamed them into it, and then when they finally jump up and say something about it they're saying that it’ll take them at least another 15 months to get the recommendations implemented.

There's a lot of tricky language in what was released today. For example - one quick example - the Treasurer says that they've implemented 15 recommendations of the Banking Royal Commission. If you look at that, you discover that seven of them aren't even recommendations of the Banking Royal Commission that they're including in that. Three of them are recommendations not to do anything so that gets you down to five. One of them's not finished yet which gets you down to four, so they've actually implemented four of the recommendations of the 76 recommendations in the Banking Royal Commission and now they expect a round of applause for coming up with a timetable.

It's just spin today, Patricia. Their heart's not in dealing with a lot of these rorts and rip-offs which were uncovered by the Banking Royal Commission and that's why so many people in our community don't trust the Liberals to do the right thing when it comes to the banks.

KARVELAS: The Treasurer says it's incumbent on Labor to work with the Government to get these changes passed quickly. Are you prepared to do that?

CHALMERS: The Government is not prepared to have them passed quickly, I'll just make that point –

KARVELAS: Well on the Government's timeline, will you facilitate getting what they say needs to be passed through this year?

CHALMERS: We think it's possible that they can implement the recommendations in a more timely way. But yes, of course we'll be constructive about the proposals as they come to us in these multiple pieces of legislation. We've been constructive all along. We called for two years for the Royal Commission before the Government finally implemented it. We had constructive proposals - even before the election - of things which could be passed quickly, which were relatively non-controversial and non-complex. The Government didn't come at that. We're always prepared to do the right thing, to do the constructive thing when it comes to passing this legislation.

And when it is bowled up to us - and when I take it through our party processes to work out what we'll say and do about it - we'll make sure that it sticks as close as possible to, and keeps faith with, the recommendations of the Banking Royal Commission because we don't want the Government to go soft on the recommendations that came from Commissioner Hayne.

KARVELAS: The Government will delay any changes to trailing commissions for mortgage brokers until after a review. Labor took a plan to have trailing commissions banned by 2020 to the election. What's your position on this now? I know a lot of policy is up for review. On this one, what's your position?

CHALMERS: You're exactly right Patricia. I mean, we're reviewing all of the policies that we took to the election. It's only been a few months now since Election Day. We've got almost three years until the next election, and we've got a bit of time to come to a position on that mortgage broker legislation because it won't come in until closer towards the end of the year, so we'll come to a view on that. People know the view that we took to the election. We'll have another look at it. We'll take a considered position on it through our internal processes and we'll announce our position in due course.

KARVELAS: So that means essentially, you're kind of backing the Government's position. They're reviewing it. You're in favour of this review then now?

CHALMERS: We always had the review, the ACCC review, as part of our policy suite. We didn't disagree with that when Commissioner Hayne recommended it - it's actually a part of the recommendation but not all of it. Everybody knows we took a different policy to the election than the Government. The Government won that election, and like all of our policies that we took to May 18 - to the poll then - we'll have another look at it and we'll take it through our internal processes again.

KARVELAS: Okay so, you were going to ban it by 2020. Obviously, you're not going to be in Government within that period of time. I accept that. That's, that's logical.

CHALMERS: Thanks for rubbing that in, Patricia -

KARVELAS: I'm not trying to, but that is the fact before us.

CHALMERS: It's a fact, yes.

KARVELAS: So that means, do you think there might still be a case for banning these trailing commissions?

CHALMERS: Like I said Patricia, it's one of those things that we're having another look at. We'll see what the Government bowls up in terms of the legislation. I'll have a chat with my colleagues. We've said right across the board - right across the board when it comes to our policies - that we've got lessons to learn from the election. We want to review really all of our policies that we took to the election. We want to take time to do that. We're not in a massive rush to review and reconsider those policies. We'll come to a view and we'll announce it before we need to vote on it in the Parliament.

KARVELAS: The Australian Securities and Investments Commission got a 25 per cent funding boost in the May Budget. Their half yearly update shows enforcement investigations are up 20 percent. Do you see that as evidence the culture in the corporate regulator is changing?

CHALMERS: I see it as evidence that the previous cuts were damaging their ability to do this important work. I'm pleased really - I'm heartened - that they were able to to pick up and run with more cases because what we want to see here is we want to see justice done in the banking system, we want to see the recommendations of the Royal Commission implemented, and we want to see confidence restored in our financial system. I do think it's important that we don't lose fact of just how important the financial system is. The rorts and rip-offs which were uncovered by the Banking Royal Commission were very damaging. We want to see confidence restored.

The best way to do that is to get these recommendations implemented in a more timely way - properly implemented, responsibly, fully implemented - so that people can have confidence again that the financial system is working for ordinary Australians and not against them.

KARVELAS: There were 13 referrals to ASIC from the Royal Commission. An additional 39 cases are being investigated with legal action planned before the end of the year. How important will those cases be in sending a message to financial institutions and trying to restore public confidence?

CHALMERS: I think it's incredibly important that justice is done - and seen to be done - without commenting on the individual, any individual cases, which may become may come before the courts. I think it's really important for Australians to have confidence that the regulators can be part of making sure that justice is served and that the Government is on the side of ordinary people and ordinary businesses who deserve better than the bad behaviour that we've seen in the financial system in recent years. If we do those things - we deal with the wrongdoers, we deal with the recommendations in a proper way and in a timely way - then we can start to restore confidence and that will have an important economic impact as well.

KARVELAS: The Prime Minister addressed public servants in Canberra today. He said he wanted them to be more focussed on ordinary Australians rather than lobbyists. Do you think that's a good move? That the public service should change its direction?

CHALMERS: Look it's the right words, Patricia, but I don't really believe them when it comes to the Prime Minister. I mean, you look at what he said today and did today. It is very clear that just like in all of the other areas he engages in, he sees the public service as an opportunity for more conflict rather than collaboration. He sees the public service as something to be tamed rather than tapped and I think that's disappointing because we do have a high-quality Commonwealth public service.

Yes, there are some issues around capacity. There are some issues around morale, frankly, and there are some issues around service delivery. But a lot of that is a function of the Government's own policies. For six years they've been hollowing out the public service, imposing these arbitrary staffing caps which just force agency heads to spend billions and billions of dollars more on labour hire and contractors and consultants. Now I didn't hear anything today from the Prime Minister which acknowledged that a lot of the problems in the public service are problems created by his Government and that he needs to address. It's not the public service's fault that he doesn't have a plan for the future, or to turn the economy around, or any of these sorts of things. He should approach the public service in a collaborative way and not in this typical, kind of, conflictual way that he has done again today.

KARVELAS: How did the idea that the public service should recruit more people from the private sector? Would that be a game changer in your view?

CHALMERS: I think it's part of the story. I'd certainly have an open mind to that. Governments of other persuasions - including ours - have had a crack at that as well. I think that it is important to get people moving in and out of the public service and tapping the best minds but that's not the whole problem. I mean the big problems here are around the fact that there is that arbitrary staffing level cap. That's been a disincentive for a lot of people, has hollowed out the public service, and means that the Commonwealth has spent billions of dollars more of taxpayer's money getting in inside help. There will always be a need for external expert advice, but it's gotten out of control under this Government - particularly when it comes to labour hire - and I think if the Government was genuine about improving the public service they would deal with those issues that they've created as well as some of these other issues that they've mentioned.

KARVELAS: There's another story that's been reported this afternoon - I'd love to get your thoughts on this. The Prime Minister of Tuvalu is considering pulling his country out of Australia's seasonal worker program in the wake of those comments from the Deputy Prime Minister Michael McCormack. He was captured on video - it was on the Guardian website - essentially saying - it was many comments but one of them - was that Pacific Islanders come and pick our fruit. What do you make of that? The idea that Tuvalu would pull out of this program?

CHALMERS: Well I haven't seen that specific report Patricia, but I think in general it was very disappointing what the Deputy Prime Minister said. Certainly not befitting somebody who holds that office, and certainly not befitting a relationship that Government Ministers and others describe as a family relationship between us and the nations of the Pacific. The key national security proposal that the Government's put on the table in recent times has been the Pacific step-up, and a combination of the Prime Minister's behaviour at the Pacific Islands Forum and the Deputy Prime Minister's comments in that video that you mentioned I think have done us damage. It's possible for us to represent our interests in these forums without running down our neighbours in a way that compromises our own interests.

KARVELAS: Well on that, if Labor had been in Government you would not have signed up to an agreement to get rid of coal out of the system would you?

CHALMERS: I saw this conversation that you had with Penny Wong on Insiders yesterday, and Penny made the point that I've made, a heap of us have made: that coal is an important part of our economy and it has a role to play even in the transition to cleaner sources of energy. But the point that we also make is that that was not the entire conversation that happened at the Pacific Islands Forum. It wouldn't have been difficult - in our view - for the Prime Minister to sign up for example to the parts of the proposal that committed us to the targets that we're supposed to be working towards but the Government made a hash of it. They damaged our standing in a really sensitive and really important part of the world and I think if we had shown some leadership on climate change - if we'd had some consistency on a proper climate change policy which has been lacking for some years now - then we'd go to these forums with more credibility so that when we do have a different view, whether it be on banning coal or something like that, then we have the capacity to make those points from a position of strength and not from a position of weakness which is worsened by the sorts of commentary that the Deputy Prime Minister engaged in.

KARVELAS: Just before I let you go, Alan Jones and his comments about Jacinda Ardern have been very controversial. He's written a letter apologising to her but right now there are more reports of advertisers pulling out. Of course he's being given what is essentially a final warning. Do you think his comments are misogynistic? Do you think Alan Jones is a misogynist and should he be on air?

CHALMERS: I think his comments are misogynistic and not just in this instance. I think he's been a repeat offender when it comes to this kind of stuff, this kind of disgraceful commentary. We all remember what he said about Julia Gillard and this is of a piece with that. It's up to the station to take the necessary action against Alan Jones. I have seen that advertisers have been pulling out and that's a matter for them as well. But I think someone who occupies that kind of position of influence in Australian society, we've all got the right to expect better than the kind of rubbish that we hear from him from time-to-time. Misogynistic rubbish along the lines of what he said about Jacinda Ardern - a key friend and ally of Australia - and also back through time about Julia Gillard and others.

KARVELAS: Jim Chalmers thanks for joining us this afternoon.

CHALMERS: Thank you Patricia.

ENDS