Faceless regulators attack on banking won’t stand

Instead of respecting the will of voters, a group of corporate regulators and virtue signallers are trying to bring about by stealth what Australians rejected in May, writes Peta Credlin.

Hardly more than six months ago, the Australian people voted against a Labor Party determined to mandate renewable energy at 50 per cent and much higher emissions reductions targets.

People voted the way they did because while they’re more than happy to see real environmental improvements, they don’t think Australia should send industry offshore and make power unaffordable when the rest of world makes a far bigger contribution (98.7 per cent) to emissions than we do. And they understood too that a 50 per cent renewable load in the power grid made it inherently unreliable.

But if you thought the people’s vote meant something, sadly you’re wrong.

Instead of respecting our will, a group of faceless corporate regulators and virtue signalling business people are trying to bring about by stealth what we rejected in May.

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Some months back, the deputy governor of the Reserve Bank said that corporate regulators had to take climate factors into account and a week or so back, the former judge and banking royal commissioner Kenneth Hayne warned that company directors had a “legal duty” to act on climate risk.

Westpac CEO Brian Hartzer was forced to resign after a huge scandal earlier this year. Picture: AAP/Lukas Coch

Now we’re told the Australian Prudential Regulation Authority and the Reserve Bank are working on new rules that will force banks and insurers to reveal their exposure to “climate risks”.

You can see where this is leading, can’t you? Banks will be even more reluctant to lend to farmers because, on top of the usual problems of variable seasons and markets that farmers have always had to cope with, there’s now, extra “climate risk”.

We know that banks – such as ANZ and others – are already loath to lend for coalmining – because many of them have been making a virtue of it to appease activist shareholders, and the big voting blocs of industry super funds.

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I’m reluctant to use the term “conspiracy” here because that suggests malign intent. In this case, I suspect the regulators are motivated by a perfectly understandable impulse to divert people’s attention from their inability to do their real job properly.

The regulators who couldn’t stop banks putting profit before probity or helping paedophiles move their money around have now decided that their real focus should be trying to save the community from climate change – and forcing on government, the very same policies that the people have only just rejected in May.

This is about making some business decisions almost impossible, and run other businesses, such as coal, out of town. Picture: Hollie Adams/The Australian

In deciding to lend, it’s always been the job of banks to make a judgment as to whether a business is capable of repaying the money, with interest.

In pricing risk, it’s always been the job of insurers to consider the likelihood of storms, floods and fires. In other words, by forcing “climate change” into decision-making, the regulators are not adding to any reasonable prudential standards because they’re already factored in. Instead, what this is about is to make some business decisions almost impossible, and run other businesses, such as coal, out of town.

Yet why should investing in a coal-mine be a negative, when the International Energy Agency confirmed last week that Australia’s coal exports will increase 10 per cent over the next five years, and global coal demand is up and up?

Why should a bank’s exposure to home loans in the Queensland coalmining community of Moranbah be a problem, when prices have gone up 19 per cent in just the past year – equal to the price rise in much-more-politically correct St Kilda?

When the Prime Minister returns to work on Monday, he should be quietly reminding these federal regulators that it’s the government that makes decisions and it’s certainly not the job of regulators to achieve by stealth what left-wing parties were unable to do in May.

Originally published as Faceless regulators attack on banking won’t stand