- No (70%)
- Yes (28%)
- Not sure (2%)
We’re keen to report your views on whether there should be a Royal Commission into the financial services sector.
This poll question stems from the recent statement by Labor’s Shadow Minister for Financial Services, Dr Jim Chalmers, that a Shorten Labor Government would hold a Royal Commission into misconduct in the banking and financial services industry.
Various industry stakeholders have already had their say on Dr Chalmer’s statement, and with the polls currently running ‘neck and neck’, the prospect of the proposed Royal Commission looms as a distinct possibility.
This is one of those polls where the question is easy and the response is complex. For example, some industry stakeholders, such as the FPA, have implied they may be ok with a Royal Commission into the sector if it carves out advice. In a statement this week, the FPA said: “…millions of tax payers’ dollars could be wasted should the Royal Commission into financial services include advice.”
Elsewhere, the AFA has questioned the cost/benefit equation of a Royal Commission, saying the money spent on such an undertaking would be better spent on providing ASIC with greater resources to police the more than adequate rules that already exist (see: Royal Commission Overlooks Extensive Reviews…).
In addition to Labor, stakeholders supporting the call for a Royal Commission include consumer groups and Industry Super Australia, whose concerns extend to how broadly and deeply unethical conduct exists in vertically integrated businesses.
According to Labor, a Royal Commission into the financial services industry will examine issues including:
- How widespread instances of illegal and unethical behaviour are within Australia’s financial services industry
- How Australia’s financial services institutions treat their duty of care to their customers
- How the culture, ethical standards and business structures of Australian financial services institutions affect the behaviour of these institutions
- Whether Australia’s regulators are really equipped to identify and prevent illegal and unethical behaviour
While the proposal for this Royal Commission has initially been costed at $53 million over two years, advisers have already weighed-in to the debate:
“If a Royal Commission does disrupt some of the reforms that are clearly only in the interests of the banks and insurers increasing profits and not the interest of customers or advisers then this is a good thing.”
It’s time for your say. Do you think a Royal Commission as outlined by Labor will serve the long-term interests of the the consumer and the industry itself? Should the advice sector be included or carved out of the proposed Royal Commission? Would the investigation do more disruptive harm than the good it may deliver? Tell us what you think as you make your voice heard…
The GFC has thrown up all sorts of weaknesses in the financial services system and this is just the latest one.
Having seen the 4 Corners report and the latest article in the Australian yesterday, Comminsure does have some serious questions to answer but a Royal Commission will just come up with a raft of recommendations that will reflect the bad behaviors from the pre-GFC era.
We have had the PJC, FOFA, The ASIC enquiry, the Murray report and LIF. These have all provided recommendations and imposed changes that will take time to reflect on the results of any additional enquiry.
A review of results in two years time will give us some idea of their impact but digging up problems from three years ago just supports the need for the chnages that have been made.
Comminsure will be judged in the court of public opinion and commercial reality as should the platforms like Australian Super (as featured in the Australian) who designed and introduced group insurances that provide the loopholes that have been used.
Has anyone considered spending the funds on a campaign to let consumers know what they should be getting and should expect when they get advice?
And also on prosecuting those who have already been caught as wrongdoers, but so far have no consequences, such as the managers/directors of the banks who created the sales cultures and continue to perpetrate the sales cultures that have caused problems. Not to mention the Industry Super funds who as Trustees of the funds providing the insurance are just as responsible for group insurance that doesn’t pay out as the insurers are.
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