Malcolm and Slo-Mo wrong on Royal Commission

11 April 2016

The Treasurer is in trouble, again, this time on the back of factually inaccurate comments on the powers of a Royal Commission compared to those of the Australian Securities and Investments Commission.

With no economic or tax policies to speak of himself, the Treasurer has got it wrong commentating on Labor’s proposal for a Royal Commission into the financial services industry.

Mr Morrison said this morning that: “ASIC already has the powers of a Royal Commission and more.” [Doorstop, 11 April 2016]. Malcolm Turnbull repeated this assertion at a follow-up doorstop.

In actual fact, there is no more powerful body to address systemic problems and misconduct than a Royal Commission. This is why the decision to bring forward a Royal Commission into the financial services industry under a Labor government was not taken lightly.

While ASIC has the power to deal with individual cases and to investigate and pursue individual instances of wrongdoing, a Royal Commission has a far broader reach.

A Royal Commission has the power to hold public and private hearings, to use search warrants, to compel the production of documents and to call witnesses from a wider pool than an individual investigation of the kind ASIC normally runs.

Critically, the Royal Commission will be set up to examine the entire system, including the broader context and causes of individual cases of misconduct and how these systemic issues can be addressed.

The Royal Commission will also examine whether Australia’s regulators are equipped to identify and prevent illegal and unethical behaviour, especially important in the context of the Liberals’ $120 million cuts to ASIC. Clearly, ASIC cannot examine their own capacity in the way a Royal Commission can.

Only a Royal Commission has the broad powers to expose and address the systemic problems we see in our financial services industry.

Malcolm Turnbull and Scott Morrison are all over the shop when it comes to misconduct and scandals emanating out of this sector.

Last week Malcolm Turnbull was talking the talk when it came to the need for change in bank culture. But just a few days after that, when Labor walked the walk by pushing for a Royal Commission into this misconduct, the Liberal Party reverted to type and decided to back in bank excesses and rip-offs over the Australian consumer.

The Turnbull Government needs to stop telling lies about Labor’s policies and start coming up with its own.