Weekly update: 03.03.23

“I think most Australians would be quite surprised that there are 17 Australians who have over $100m in their superannuation accounts, and one has over $400m. That means that for 99.5 per cent of superannuants this will have no impact on them whatsoever”

– Anthony Albanese, Prime Minister

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Parliamentary Update:

• Treasurer Jim Chalmers released a revised Tax Expenditures and Insights Statement containing new information on concessions, credits, deductions and other features of Australia’s tax system.
• The Prime Minister and Treasurer announced a policy change on superannuation tax treatment. The Treasurer followed the announcement with numerous media appearances.
• The Prime Minister and then the Treasurer ruled out capital gains tax changes on ‘the family home’.
• Jim Chalmers issued a key media release on the December quarter 2022 National Accounts.

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“We are not going to impact the family home, full stop, exclamation mark.”

– Anthony Albanese, Prime Minister

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• The Senate, Rural & Regional Affairs & Transport References Committee conducted a public hearing in Sale, Victoria, on ‘Bank closures in regional Australia’.
• The Senate Economics Committee conducted a spill-over Estimates session with ASIC. Senator Bragg issued a media release following the proceedings.
• NSW Premier Dominic Perrottet and Leader of the Opposition Chris Minns attended the one-year service commemorating the Lismore floods.

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Policy Update:

• ABA attended a design workshop for the National Anti-Scams Centre (NASC), with representation from multiple industry sectors including banking, telecommunications, and social media platforms along with a number of regulators. The NASC will provide a single source of truth for scam information and co-ordinate united action across all sectors of the economy to help tackle the problem of scams.
• The ABA and Westpac appeared at the Joint Parliamentary Committee on Corporate Insolvency in Australia on Tuesday 28th February. The ABA took the opportunity to reiterate the themes of its submission to the inquiry, namely that it supports improvement and reform of Australia’s corporate insolvency regime, rather than replacing it with a United States style Chapter 11 debtor in possession model.
• On Thursday 2nd March the ABA also attended Attorney General Mark Dreyfus’ roundtable on Personal Insolvency.

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Regulatory Update:

• Use cases for the RBA’s Central Bank Digital Currency (CBDC) project were announced. The $180 million research project is a joint venture with the Digital Finance Cooperative Research Centre and will include five use cases led by ABA members.
• APRA released an update on its macroprudential policy settings and released its monthly ADI statistics.
• ASIC published a report on good practices for handling whistle-blower disclosures. The recommendations were based on a review of seven entities’ whistle-blower programs. The reviewed entities were drawn from a range of industries and included two banks.
• An investigation into greenwashing practices by the ACCC found ‘widespread concerning claims’. The investigation included 247 businesses in eight sectors. The ACCC intends to produce updated economy-wide guidance material following their findings.
• ASIC appeared before Senate Estimates to provide further information on the investigation Treasury undertook into one of the Commissioners in 2021. The ASIC Chair reiterated that there were no adverse findings at the time, and that the Chair had no cause for concern from his observations since that time

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Economic Update:

• Australia’s household savings ratio has dropped to 4.5%. The ratio refers to the rate of income saved relative to total income earned. This spiked during COVID as people stayed home and the drop to 4.5% is closer to longer-term levels. It’s slightly below what was observed pre-COVID, but not significantly.

Figure 1: Household savings ratio, December 2014 – December 2022, %

• At the same time, household deposits on the books of ADIs show that household savings continue to increase slightly. The value of total household deposits now sits at $1.35 trillion, up $1.7 billion (0.1%) from December 2022 and up $110 billion (8.9%) from January 2022.
  

Figure 2: Household deposits on the books of ADIs, March 2019 – January 2023, $m

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Upcoming Events:

• Wednesday 8 March 2023
  International Womens Day #EmbraceEquity
  Minter Ellison, Sydney (3:30pm – 7:00pm).

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Submissions Lodged:

• Hybrid mismatch rules: interpretation and reporting
• Interest rate risk in the banking book for ADIs
• Statutory review of the Payment Times Reporting Act 2020
• Nature Repair Market Exposure Draft
• Review of the Australian Autonomous Sanctions Framework

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Upcoming Submissions:

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Selected Media:

• ABC radio  – NAB CEO, Ross McEwan interviewed by Radio National’s Patricia Karvelas
• ABC radio Conversation Hour – Anna Bligh interview with hosts Richelle Hunt and Kirsten Diprose on regional bank branches
• AFR – ‘Tiny’ Macquarie is now the 5th ‘big’ bank
• The Australian – APRA maintains 3 per cent loan ceiling, warns of tougher economic times to come
• ABC News – rural and regional bank branches

Weekly Update