Modern Australian


Frydenberg outlines financial sector reform timetable

  • Written by Michelle Grattan, Professorial Fellow, University of Canberra

Treasurer Josh Frydenberg has issued a timetable for the government’s dealing with the recommendations from the royal commission into banking, superannuation and financial services, which aims to have all measures needing legislation introduced by the end of next year.

The opposition has accused the government of dragging its feet on putting into effect the results of the inquiry, which delivered its final report early this year.

“The need for change is undeniable, and the community expects that the government response to the royal commission will be implemented swiftly,” Frydenberg said in a statement on the timetable.

Fydenberg said that in his final report Commissioner Kenneth Hayne made 76 recommendations – 54 directed to the federal government (more than 40 of them needing legislation), 12 to the regulators, and 10 to the industry. Beyond the 76 recommendations, the government had announced another 18 commitments to address issues in the report.

The government had implemented 15 of the commitments it outlined in responding to the report, Frydenberg said. This included eight out of the 54 recommendations, and seven of the 18 additional commitments the government made. “Significant progress” had been made on another five recommendations, with draft legislation in parliament or out for comment or consultation papers produced.

Read more: Grattan on Friday: How 'guaranteed' is a rise in the superannuation guarantee?

Frydenberg said that, excluding the reviews to be conducted in 2022, his timetable was:

  • by the end of 2019, more than 20 commitments (about a third of the government’s commitments) would have been implemented or have legislation in parliament

  • by mid 2020, more than 50 commitments would have been implemented or be before parliament

  • by the end of 2020, the rest of the commission’s recommendations needing legislation would have been introduced.

When the Hayne report was released early this year, the government agreed to act on all the recommendations.

But one recommendation it has notably not signed up to was on mortgage brokers.

Hayne found that mortgage brokers should be paid by borrowers, not lenders, and recommended commissions paid by lenders be phased out over two to three years.

Read more: Wealth inequality shows superannuation changes are overdue

The government at first accepted most of this recommendation, announcing the payment of ongoing so-called “trailing commissions” would be banned on new loans from July 2020. Upfront commissions would be the subject to a separate review. Four weeks later in March Frydenberg announced the government wouldn’t be banning trailing commissions after all. Instead, it would review their operation in three years.

Releasing the timetable, Frydenberg said the reform program was the “biggest shake up of the financial sector in three decades” and the speed of implementation “is unprecedented”.

“It will be done in a way that enhances consumer outcomes with more accountability, transparency and protections without compromising the flow of credit and competition,” he said.

He undertook to ensure the opposition was briefed on each piece of legislation before it came into parliament.

“This will begin with the offer of a briefing by Treasury on the implementation plan. Given both the government and opposition agreed to act on the commission’s recommendations, we expect to achieve passage of relevant legislation without undue delays,” he said.

He said the industry was “on notice. The public’s tolerance has been exhausted. They expect and we will ensure that the reforms are delivered and the behaviour of those in the sector reflects community expectations.”

Authors: Michelle Grattan, Professorial Fellow, University of Canberra

Read more http://theconversation.com/frydenberg-outlines-financial-sector-reform-timetable-122024

NEWS

what teachers are saying about COVID-19 and the disruption to education

ShutterstockAll Victorian school students will be learning remotely from Wednesday. Prior to the state’s premier Daniel Andrews announcing a tightening of restrictions over the weekend, only students in prep to...

As 'lockdown fatigue' sets in, the toll on mental health will require an urgent mental health response

ShutterstockAs Victorians face yet another long period of enforced lockdown, serious concerns are being raised about people’s capacity to comply with the new orders and the mental health impacts of...

why health-care workers in Australia are inadequately protected against coronavirus

ShutterstockIn Victoria, more than 1,100 health-care workers have now been infected with SARS-CoV-2, the coronavirus that causes COVID-19. Some 11% of active cases are workers in the health-care sector.Health-care workers...

Babe at 25, a trailblazing cinematic classic

Universal PicturesIt wasn’t the first time I’d crashed a film set. My first was the 1984 film The Coolangatta Gold. You’ll recognise me in one of the shots because I’m...

400,000 women over 45 are at risk of homelessness in Australia

ShutterstockOlder women have been recognised as the fastest-growing group of homeless people in Australia in recent years. Yet until now we have not known exactly how many older women are...

older women renters are struggling

ShutterstockOlder women renters are struggling in an insecure and unaffordable rental housing market. A combination of high rents and low incomes leaves many living in substandard housing and unable to...

How climate change made the melting of New Zealand's glaciers 10 times more likely

Dave Allen, Author providedGlaciers around the world are melting — and for the first time, we can now directly attribute annual ice loss to climate change.We analysed two years in...

Our states are crying poor. They wouldn't if they charged for rezoning like the ACT

Google MapsThroughout Australia, when land is rezoned from industrial to high-rise residential, a charge is levied to help fund the required infrastructure.In NSW it is called an infrastructure contribution.The NSW...

5 scientists tell the stories behind these species names

Left: imdb. Right: Volker Framenau Weaving creative, heartfelt or even risqué words into the formal Latin names for new species has long been common in taxonomy — the science of...

Australia won't recover unless Victoria does too. The federal government must step up

The announcement of stage 4 restrictions in Victoria marks a new, and depressing, stage in Australia’s response to COVID-19. The new measures will close non-essential retailers and most child-care centres...

Victoria's child-care shutdown is a hard blow for working mothers

ShutterstockHow do you occupy a child for long enough to get any work done?This will be the question confronting more than 150,000 Melbourne families for at least the next six...

here's why Melbourne's new business restrictions will reduce cases

Victorian Premier Daniel Andrews has announced sweeping changes to businesses across metropolitan Melbourne, including closure of retail stores and restrictions on some industries, including construction. The new constraints come into...

Popular articles from Modern Australian

How to supercharge your immune system for cold and flu seasonHow to Avoid Blocked Drains and Stinky OverflowCBD on Cyber Monday: Buying the Best for You5 Beginner Projects You Can Make with Arduino Starter KitWhy Your Outdoor Living Areas Might Benefit From TilesRetirement on the Road: Planning a Post-Retirement Australian Road TripDesign a Pool to Fit Your SpaceHow to Get TEFL Certification for Teaching English in ThailandHow to Find a Lawyer in Sydney for Your Legal RepresentationHow to Pre-Prepare For Your Retirement3 of the most common beginner’s mistakes in table tennisTips to Choose Regular Wear Bands for Your Brand New Apple WatchThe Benefits of Living a Healthy LifestyleHOW TO STUDY ART WITH WIKIART.ORGHow to transform a