30 November 2017
Transcript - #2017233, 2017

Interview with Ben Fordham, 2GB

SUBJECTS: Royal Commission – Banks and Financial Services; Bill Shorten’s failure to expel Sam Dastyari from the Labor party; Sam Dastyari’s failure to resign from the Parliament

BEN FORDHAM:

Why does it take you guys so long to see what's been obvious all along?

TREASURER:

I listened to what you said in your introduction there, Ben. Over the last two and a half years, the Government has been taking action on the banks and we have been taking action – whether it's on complaints, you've referred to the inquiries yourself, on CBA in particular there's a Laker Commission already in the CBA right now doing exactly the things you're talking about. The Banking Executive Accountability Regime, the increased resources for ASIC and powers to actually pursue and prosecute, the banks are already in court on a number of these issues. So there's myriad actions that we've been taking right now and if we'd done what you've suggested, none of those things would be taking place over the last two years because everyone would say, "Wait until the Royal Commission's over and then we'll take action." Several…

FORDHAM:

So is this all part of the master plan?

TREASURER:

No, no, you had a good go at the start. Several hundred million later, several years down the track, someone might have gotten around to doing something. We got around to doing something over two years ago. Now, over that period of time, Bill Shorten has continued to play politics on this issue and the advice I received over the back part of the last 48 hours was that that politicking was damaging the credibility of our banking and financial system upon which the job of every Australian depends.

FORDHAM:

Treasurer, they damaged themselves. They damaged their own reputations when they treated us like mugs.

TREASURER:

Yes, but tell me this, because I've been working on people's individual cases and we've announced the Royal Commission today but I can tell you that a Royal Commission is not going to settle their cases. It never was, it was never designed to do that and what I wasn't going to do and what the Prime Minister wasn't going to do was going around lying to people like Bill Shorten and say, "You have this Royal Commission and all your problems will be solved." That is complete bunkum…

FORDHAM:

You have been very firmly saying there will be no Royal Commission and today there's a Royal Commission, you know that's a backflip, right?

TREASURER:

I know we've changed positions for this reason because up until the last 48 hours or so, the costs of doing a Royal Commission – and I don't just mean the fiscal cost, I mean the impact that can have internationally on the reputation of our banking and financial system around the world – when people form judgements about that, that decides how much interest we pay on our debt, how much interest people pay on their home loans, how much interest they pay on their credit cards, all of that is affected by the international reputation of our banking system. One of the reasons we survived – the reason we survived the Global Financial Crisis was because of the strength of our banking system and the controls that we had over it. Now, you put that at risk by playing politics with that which is what Bill Shorten – now, I know that lots of people have got concerns with the banks, that's why we've been taking action, but the action that was being proposed ran the risk of undermining the confidence in the banking system. What our view has been moved to now is that all of that politics, all that nonsense that was going on in the Senate was going to produce an outcome that would do so much damage and that would hurt our economy, that going forward with the Royal Commission now was better than not going forward with it.

FORDHAM:

I can't quite follow that. So all these calls for a Royal Commission was undermining the confidence of the banking sector but now you're going to have a Royal Commission and presumably…

TREASURER:

It's better than the alternative.

FORDHAM:

And presumably undermine the confidence of the banking sector?

TREASURER:

Because what was going to be forced by the Parliament would have been worse. Way worse and that was the advice that we received. Now, Bill Shorten has done damage to the Australian economy in the way he's conducted himself on this issue, if he can do that much damage from opposition, imagine how much damage he would do in Government.

FORDHAM:

But can you see that people find this a bit unfair because of those very important factors you've raised about the banks and the role they play in society but people think, ok, because of that all of a sudden, you're able to get away with things, for example, we'd never allow a union to get away with – everyone watched the Union Royal Commission, they saw all these people dragged before the Royal Commission, forced to answer questions but when the dodgy stuff was going on in the banks, you guys just said no to the Royal Commission. I think you've got to acknowledge that you guys got that wrong.

TREASURER:

No, because if we had done the Royal Commission then, we would have done it for populist political reasons because the advice was this would do damage to our economy…

FORDHAM:

So Bill Shorten was right when he read the public mood back then?

TREASURER:

No Bill Shorten was being a cynical populist like he always is and was making false promises to the Australian people that a Royal Commission would settle their cases with problems that they'd had with the banking system and that was an outright cruel lie and I wasn't going to indulge it. I know, Ben, that there was populist support for a Royal Commission, but did I think it was going to solve these people's problems? No. Was it going to make executives more accountable in the banks? No, I went and did that.

FORDHAM:

Was this part of a master plan to say no to it for 18 months then say yes now?

TREASURER:

I said today that this action was regrettably necessary because it was put in this situation where the risk of no longer doing it became greater and that is because of the politics playing of Bill Shorten and the shenanigans we saw in the Senate.

FORDHAM:

So he got ya?

TREASURER:

Ben, I am not going to trivialise what is a really serious issue with gotcha scenarios. Seriously mate. We are talking about the banks and the financial system that underpins our entire economy. It is not a game.

FORDHAM:

No we are also talking about the judgment of the federal government when people sit back and say ok if it is so obvious. I want to play you something from April 2016 that I said on this program and I have been saying it ever since. I will take you back to April 2016:

[FORDHAM EXCERPT]

I think Labor is on a winner in pushing this inquiry on the banks. It is hypocritical to be holding a commission into union corruption but not look into dodgy dealings with the banks. Labor is pushing for a royal commission into the financial industry and I think they are on a winner. Malcolm Turnbull is riding another losing horse by taking the banks' side.

[END OF EXCERPT]

FORDHAM:

Did you have time Scott Morrison over the last 18 months when you thought this is not a good look and I know you are saying there is all this other stuff going on behind the scenes which have received results but it looked like you guys were protecting the banks from a Royal Commission.

TREASURER:

Well that is not true. It was not the right option for the Australian economy and I don't resile from the position I took over that entire period of time. Over that period of time I have done everything from impose a bank levy which the banks attacked us for…

FORDHAM:

I love the bank levy. Some of my colleagues don't but I love the bank levy.

TREASURER:

But when you go back to your comment from April 2016, you were talking about politics Ben. This isn't about politics this is about the economy on which people's jobs depend and I don't get the luxury of…

FORDHAM:

Scott you know you work in politics right?

TREASURER:

But I am the Treasurer of the country mate and I have a responsibility to ensure the good conduct of the banking and financial system and that its credibility is not trashed in international markets.

FORDHAM:

While we are talking about credibility let me ask you about 'Shanghai' Sam Dastyari. He stood down from two positions I think as the Deputy Whip in the Senate for the Labor party and also as a committee chairman. Does he need to go from politics altogether after all of the cover ups and all of the lies in regards to the Chinese donor?

TREASURER:

'Shanghai' Sam who I have also christened today as 'Last Chance' Sam has had his last chance. He has got to go from Australian politics and never come back. That is the bottom line. I mean he has shown a disloyalty to his country. We have got two by-elections going on for people who it came to their attention and honestly declared through the citizenship bewilderment we have had on a legal position they had – had to step out of the Parliament. Nobody thinks Barnaby Joyce or John Alexander in any way have betrayed their country. That's a nonsense. But Shanghai Sam has and he should go.

FORDHAM:

What about the lengths he went not only to help out the Chinese Communist Government via his mate who is aligned with them but also to cover the whole thing up about that press conference and to say no I was speaking about safe schools and a question came up about Chin and I just fluffed the answer and the audio comes out and it was a definite direct comment on China and in all of the TV interviews around his book he was trying to pretend sorry I just fluffed by lines?

TREASURER:

This is just an absolute disgrace and for Bill Shorten to sit there and say this is all pretty terrible and please don't do it again Sam and you have to hand in your library card at the Parliamentary Library and not borrow books for a while because you are no longer a chair of a committee or some such nonsense. It is rubbish. If Bill Shorten had any steel in him at all he would have this guy kicked out of the Labor party at the very least. Only Sam can resign from the Parliament which he should do as a matter of honour. He has disgraced the Senate, he has disgraced the Parliament, he has disgraced the Labor party and the fact that Bill Shorten can sit there and say 'oh yeah that is aright we tolerate that'. Give me a break. The guy has got to go, he should go and never come back.

FORDHAM:

Your bank Royal Commission has taken some of the spotlight off him. He is probably loving you today.

TREASURER:

I don't think he has ever loved me and it is mutual. Let me tell you a story if we have time Ben.

FORDHAM:

Sure go for it.

TREASURER:

I remember once someone called me out of the media, this is when we were in opposition, and they said to me when I had that strong position on turning back boats, they said look this isn't very popular, why do you have to do that? And I said that it will work. It is the right thing to do and if I walk away from that we will never solve the problem. Now I take that approach when it comes to policy to every issue. I do what I think is right. I know sometimes people disagree with me. I know some of your listeners have often disagreed with me and on other programs. But mate I will always do what I think is right for the country. The big problem with Sam Dastyari is he didn't even get to first base on that principle and he should go.

FORDHAM:

Really good to talk to you Scott Morison, we will talk again soon. Thanks so much.

TREASURER:

Cheers mate.