Scott Morrison lashes Bill Shorten’s inaction on banks

Scott Morrison won’t concede government should’ve acted sooner, lashing Bill Shorten’s inaction as financial services minister.

Scott Morrison has refused to concede the government should have acted sooner to establish a royal commission into the banking sector, and lashed Bill Shorten for failing to act to protect consumers from banking misconduct when he was financial services minister.

Malcolm Turnbull declared overnight in Europe that the government had suffered politically for failing to establish the royal commission sooner, and “with the benefit of hindsight” that pain could have been avoided.

The Treasurer acknowledged the “political flack” suffered by the government, but said “taking action took precedence for customers, over politics”.

He said the government hadn’t established the royal commission any earlier because it wanted to get on with banking industry reforms, including tougher accountability laws for bank executives and a new financial complaints authority.

“We initiated the royal commission. At the end of the day, I think that’s what people care about. Did it happen? Yes. Had we taken action before that? Yes. Will we keep taking action on this? Yes. Did we put the levy on the banks? Yes.

“So when it comes to addressing his issue, there is a list a mile long of the action we have taken. And that (is) in stark contrast to the do-nothing attitude of the Rudd-Gillard-Rudd government on that matter.

“I mean, Bill Shorten only ever had a blank sheet of paper when it came to the terms of reference for a royal commission. And the first time he talked about a royal commission wasn’t when he was the minister for financial services, in the Rudd-Gillard-Rudd government. It was when he was in opposition.”

Bill Shorten. Picture: Mathew Farrell.

Speaking in Berlin, Mr Turnbull said the government “knew what the problem was with the banks” but wanted to introduce reforms immediately and the banks would have used the royal commission to defer greater accountability.

The Opposition Leader said Mr Turnbull had “fought Labor tooth and nail against having a royal commission so he could protect his mates at the big end of town”.

However, he admitted Labor should have taken on the banks when it was in government.

“Two years ago when Labor said we needed to have a royal commission, we acknowledged that it should have been done previously,” Mr Shorten said.

“But every time the banks always turned up: ‘Oh it’ll never happen again’. Scandal after scandal. Two years ago I said enough is enough. The banks have run out of time and run out of excuses.”

Mr Turnbull said he made the decision not to call a royal commission sooner. “You are all right when you say when you say politically it would have been better for us if we had done it years ago.”

“But the reason I didn’t proceed with a royal commission was this, I wanted to make sure we took the steps to reform immediately and got on with the job. My concern was that the royal commission would go on for several years and people would then say ‘you can’t reform you can’t legislate you have to wait for the report’ and that’s what would have been said,” Mr Turnbull said.

Prime Minister Malcolm Turnbull. Picture: Ella Pellegrini.

Mr Turnbull said that despite “hindsight and not being able to live our lives backwards” it was better that the Government “got on” with its reforms, massively strengthened ASIC and created a one-stop shop for consumers and now had a royal commission to consider the reforms the Government has put in place.