Media Release
Thursday 10th December 2009
Open letter to Tony Abbott about his call for bank
regulation
Dear Mr. Abbott,
We read with interest your comments about stronger regulations for Australia’s banks. These are
welcome, and share much in common with finance sector workers long-standing suggestions.
Like you, we wondered why there were no conditions attached to generous taxpayer support for our
highly profitable banks. The Finance Sector Union repeatedly asked that, in return for underwriting
banks’ risks and guaranteeing deposits, the Government should mandate protection for Australian
finance jobs.
Indeed, during the global financial crisis, Australians saw an erosion of competition and banks
increasingly usurping the Reserve Bank’s role in setting monetary policy. Westpac’s recent mortgage
increase is but one example. You will no doubt recall that when rates were on the way down, all
major banks refused to pass along the full decrease to consumers.
At the same time, Australian finance jobs continue to be sent abroad despite overwhelming
opposition from consumers. You may be aware of a Senator Xenophon’s suggestion, currently before
the Senate, that would require consumers’ written consent before their data is sent off-shore to be
processed. Liberal support for this initiative would be welcome.
We’ve also seen banks increase sales targets for debt products relentlessly, despite Westpac CEO Gail
Kelly talk openly about the problems of more debt. This was directly linked to thousands of
Australian families losing their life savings in the collapse of Storm Financial. Disappointingly, the
Government has baulked at regulation to solve the problem.
And then there is executive remuneration, which continues to rise almost unabated. Recent
recommendations released by APRA to rein in these often-obscene salaries were watered down.
With the global financial crisis easing, we have little doubt that executive salaries are set to soar
again, even as frontline workers are offered paltry pay increases.
The Finance Sector Union would welcome the opportunity to meet with you to discuss some of the
practical suggestions we have made to better regulate Australia’s banks. And to underline the
Government’s role in ensuring our major banks act in our community’s interest with good
competition, fair interest rates, job protection and responsible lending to the engines of our
economy.
Banks are not like banana smoothie stores. They are a vital part of Australians’ everyday life and a
major source of employment. Like you, we are distressed a Government that weighs in during the
heights of the latest outrage only, but does not take the much needed step to regulate on these issues.
Sincerely,
Rod Masson, Acting National Secretary
Finance Sector Union
For more information or interviews please contact Leanne Shingles on 0423 821 773 or Anaya
Latter on 0432 121 636
NEWS 
