SKY NEWS AM AGENDA
TUESDAY, 26 NOVEMBER 2019
SUBJECTS: Westpac; Government's failure to implement Banking Royal Commission recommendations.
ANNELISE NIELSEN: We are going to chat with Stephen Jones, Shadow Assistant Treasurer, here in Parliament. Thank you for your time.
JONES: Great to be with you.
NIELSEN: Now yesterday you were calling for Brian Hartzer’s head to go. What do you make of today's development?
JONES: I don't think he had any alternative. I thought his position was untenable. Once it became clear that the bank had basically been facilitating pedophiles accessing sites overseas through their payments network and that the bank had in place the proper procedures and the board hadn't put in place the oversight, the position of the chairman and the position of the CEO were untenable.
KIERAN GILBERT: Were you surprised it took so long?
JONES: I thought it might happen a little earlier. I was certain it would happen before the end of the week. Whether it was the spectre of the shareholders meeting in a couple of weeks’ time, which prompted them. I don't think the media cycle went the way they expected it to. We were showing some restraint from our point of view. We thought common sense would and should prevail in the end it has. This is not the end for the Westpac board. It was a failure of management, but it was also a failure of governance and oversight. I think every bank board around the country should be paying close attention to what's going on with both the ANZ and the Commonwealth Bank cases. I think this should also serve as a very, very stiff prompt to the Government that their track record of implementing the recommendations from the Royal Commission is not good enough. Only six of the 76 recommendations have been implemented, only seven days of Parliament left. Get your skates on guys. We’ve got to get this done.
NIELSEN: When it comes to the Government's response, you’re right, hey were quite muted in their response up until now, do you think it shows that there is that lack of understanding at the bank level of how the stuff plays out in the general public? If they're saying well, this isn't an Enron or a Lehman Brothers. Yeah, it's a lot worse than a lot of us expect, but the banks not going down, but you've been allowing a lot of really bad behavior to go ahead. Is that a cultural problem that we need to be addressing?
JONES: I think they are way out of touch, quite clearly. The CEO was way out of touch. The chairman was way out of touch. In fact, when I read through yesterday the comments of the chairman who was saying basically we’ll keep him there if we can get away with it, that was what prompted me to intervene and say not good enough, times up, you've got to go. If the instinctive response of the chairman is not to take responsibility, but to say, do we think we can get away with this, and that's very very wrong and I think every board, in every bank, in every financial institution in the country has got to revisit the lessons of the Royal Commission, not just the recommendations, but the public outcry that led to the Royal commission.
GILBERT: That's the surprising thing, isn't it? Given what a shocking period they've had at every level in terms of the cultural problems that an individual could be of that view, let’s just ride this out.
JONES: Absolutely the wrong instinct from both the board and the chairman and I think it's going to send a very, very clear message to every bank and every bank board around the country. If we thought the Royal Commission was over and if we thought the uproar, the concern in the public, was over it's not and every time one of these instances comes up and it's not well handled then the public is going to have the same response.
NIELSEN: Just on your point about the Banking Royal Commission recommendations not being enacted. What should be being addressed in this next fortnight that isn't being addressed? A lot of those recommendations are for reviews, for check-ins later down the track, what could actually be done right now that's not being done?
JONES: There's a couple of easy wins there that I've reached out to the Government said we're willing to work with you on this, bring the legislation in it will see a quick passage through the Parliament. I've previously identified the anti-hawking laws. We support them, the Government supports them. Get your skates on and make it happen. It means over the Christmas period, customers won't have predatory selling behaviours of superannuation and insurance products. That's number one. Number two, reforming the claims handling processes for general insurance products. We're going into natural disaster season, bush fires, floods, cyclones. I hope it doesn't happen, but you'd have to be silly to say there wasn't going to be some pattern of natural disaster. Claims handling follows. A whole heap of reforms have got to be put in place to ensure that the customers get what they bought when it comes to their insurance products. Two easy reforms that could have been done and would have had our backing as we go into Christmas. Not good enough.