GRACosway Weekly Wrap Up: Government cracks down on banking and financial services sector
- Prime Minister Malcolm Turnbull is in London for the Commonwealth Heads of Government Meeting.
- The Financial Services Royal Commission has unearthed evidence of serious misconduct by major financial institutions, as the Federal Government seeks to strengthen penalties and oversight in the sector.
- State energy ministers are meeting in Melbourne today to continue discussions on the Federal Government’s proposed National Energy Guarantee.
- Treasurer Scott Morrison has downplayed rumors of excessive infrastructure spending in the May Budget.
- The Greens have proposed a policy to legalise recreational use of cannabis.
Prime Minister Malcolm Turnbull is in London for the Commonwealth Heads of Government Meeting (CHOGM), where discussions are expected to focus on recent chemical attacks in Syria; intelligence and security; foreign interference; and uncertainty surrounding North Korea. Following discussions with the Prime Minister of Vanuatu, Mr Turnbull has stated that recent media speculation about China’s interest in establishing a military presence in the South Pacific was unfounded. He has also downplayed rumours of potential damage to Australia’s trade ties with China, saying the relationship is “strengthening all the time”.
Royal Commission Fallout
Explosive evidence of serious misconduct by major financial institutions has emerged in the second round of hearings of the Financial Services Royal Commission. AMP Chief Executive Craig Meller has resigned in the wake of the revelations, saying he is “personally devastated” by the issues uncovered. The Federal Government this morning announced a new package of increased and harmonised penalties for corporate wrongdoing, including 10 years’ imprisonment for individuals and maximum fines of $210 million for major banks and financial services companies. Under the changes, the Australian Securities and Investments Commission (ASIC) will be granted additional powers, while the Banking Executive Accountability Regime (BEAR) will be extended beyond major banks. Meanwhile, Finance Minister Mathias Cormann has committed to extending the Royal Commission beyond the 12-month timeline, if required.
Energy Ministers Meet
State energy ministers are expected to give in principle support for the National Energy Guarantee (NEG) at today’s Council of Australian Governments (COAG) Energy Council meeting, committing to further work on the plan ahead of a final vote in August. Victorian Energy Minister Lily D’Ambrosio confirmed that the Andrews Government is not yet over the line on the NEG and will be seeking assurances that “more ambitious” state targets on emissions and renewables will be honoured under the plan. Federal Energy Minister Josh Frydenberg said he is confident state colleagues will recognise the “historic nature” of the reforms, while remaining “unequivocal” that emissions reductions from state-based schemes will count towards the national 26 per cent emissions reduction target under the NEG.
Scott ‘Santa Claus’ Morrison
Treasurer Scott Morrison has sought to manage expectations set by Acting Prime Minister Michael McCormack, who claimed the Treasurer will hand down “an infrastructure Budget” in May, rife with “goodies”. The statement led to a front page Daily Telegraph feature of Mr Morrison dressed as Santa Claus. The Treasurer clarified that “there won’t be any Christmas in May”, while confirming, “The Grinch won’t be making an appearance either.” This follows $5 billion already announced for the Melbourne Airport rail connection, and $1 billion for the M1 Motorway in Brisbane.
Legal Cannabis Proposal
The Greens have announced a policy to legalise recreational use of cannabis, with the aim of imposing greater regulation on the drug and sinking criminal activity associated with its production, sale and use. The policy has been slammed by the Government and Opposition, with Health Minister Greg Hunt describing the idea as “medically irresponsible” and calling on the party to withdraw its suggestion. Bill Shorten labelled the proposal “political clickbait”.