Weekly update: 17.02.23

“This government is serious about cracking down on scammers and the criminals who are robbing households and innocent Australians of their hard-earned cash”

– The Hon Stephen Jones MP Assistant Treasurer and Minister for Financial Services, Feb 2023.

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Trans-Tasman Annual Economic Forum

• ABA CEO Anna Bligh spoke with Westpac Group CEO Peter King at the Trans-Tasman Business Circle Economic Forecast 2023 in Sydney today. Peter told the audience that Westpac is there to support customers who face financial difficulty in a constrained economic environment but noted there is no ‘mortgage cliff’. Westpac is keeping an eye on unemployment given its link to customers ability to make mortgage repayments. He also discussed the scam ecosystem, and the responsibility of all sectors in the detection of scams to prevent consumer harm. The Hon. Jim Chalmers MP, Treasurer also spoke, noting the importance of the economic relationship with New Zealand and the Government’s interest in speeding up the process by which New Zealanders can become Australian citizens.

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Parliamentary Update:

• The Treasurer formally tasked the ACCC to conduct an inquiry into retail banking deposits. The ACCC issued a media release on the inquiry.
  The Treasurer conducted a press conference on the latest unemployment figures, which have increased to 3.7% (from 3.5%). Assistant Treasurer Stephen Jones:
  • Held a scams roundtable meeting with banks, telcos, digital platforms and consumer advocates.
  • Issued a media release with Communications Minister Michelle Rowland on Sender ID scams and the possible implementation of a SMS sender ID register.
  • Made noteworthy comments about interest rates, the RBA, and monetary policy.
  • Released submissions made to a consultation on BNPL regulation.
• Assistant Minister Andrew Leigh took part in a Sky News interview and mentioned the Government’s ACCC retail deposit inquiry.

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“We know what the Reserve Bank and the Treasury expects when it comes to the unemployment rate, and that is for it to tick up a bit more into the middle fours” 

–  The Hon Dr Jim Chalmers MP, Treasurer

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• Senators Canavan, Rennick and Darren Chester MP issued a media release stating that the first hearing of the Senate Inquiry into regional branch closures will be held in Sale Victoria on 2 March.
• Several MPs made statements on bank branches, including:
  • Anne Webster, Member for Mallee
  • Bob Katter, Member for Kennedy
• Senator Andrew Bragg issued a media release on a reported inquiry into a senior ASIC official.
• The following housing Bills passed the House and now head to the Senate:
  • Housing Australia Future Fund Bill 2023
  • National Housing Supply and Affordability Council Bill 2023
  • Treasury Laws Amendment (Housing Measures No. 1) Bill 2023
• The Treasury Laws Amendment (2023 Measures No. 1) Bill 2023 was introduced into the House.
• The National Reconstruction Fund Corporation Bill 2022 was debated in the House.

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Policy Update:

• The ABA participated in an important roundtable discussion on scams earlier this week in Canberra. Hosted by Assistant Treasurer and Minister for Financial Services, The Hon Stephen Jones MP, the roundtable was an excellent opportunity to discuss the latest on scams with representatives from banks, key digital platforms, consumer groups, and telecommunication organisations. The group examined the current scams environment, emerging trends and ways to work together to prevent and detect scams.

• The ABA attended the Australian Business Economists Annual Forecast where they heard from Marion Kohler on RBA’s 2023 monetary policy statement, Guy DeBelle on transitioning to green energy and Chris Richardson on the role of economists in contributing to public discourse.
• The ABA and members met with APRA’s policy and risk teams to discuss the consultation on the revised draft APS 117 Interest Rate Risk in the Banking Book (IRRBB). The ABA will continue to lead this engagement, and will lodge an industry submission on 1 March 2023. 
• The ABA met with the Asian Development Bank on the emerging blue bonds market. ABA will continue to monitor the developments in this space and the interface with climate and nature.

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Regulatory Update:

• Under the direction of the Treasurer, ACCC launched an inquiry into deposit interest rates. They are expected to deliver their findings by December 1.
• All Treasury portfolio regulators including RBA, ACCC, ASIC and APRA appeared before the Senate Economics Committee. Issues raised with the RBA included the interaction of monetary and fiscal policy, the role of interest rates on housing prices and cost of living, monetary policy decision-making including the role of the board and whether there is any influence from government. Lowe confirmed the RBA remains entirely independent. APRA provided updates on financial stability and reiterated that they are yet to see signs of stress in the market. ACCC were asked about greenwashing and government intervention in gas markets.
• ASIC announced their enforcement priorities for 2023. These include targeting sustainable finance practices and disclosure of climate risks, financial scams, cyber and operational resilience, and investor harms involving crypto-assets.

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Economic Update:

• Australians continued to increase the value of their overall spending in December 2022, with total spending growing 11.2 per cent from December 2021.
• While household spending on discretionary goods and services increased from November 2022 to December 2022, non-discretionary spending fell. There is some evidence that this is coming from an increase in spend on travel and associated activities during the summer months.
• When we look longer term, we can see that most of the growth in spending in 2022 came through the winter months last year. While there has continued to be increases in November and December, these increases are smaller than the movements we saw between May and October.

Household discretionary and non-discretionary spending, Current price, January 2019 – December 2022, Index & %

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Communications and Media Update:

• Key media this week included the ACCC’s investigation into deposit rates, regional bank branches, exchange settlement account balances and the RBA Governor’s appearance at Senate estimates.
• Anna Bligh was interviewed on ABC News covering a wide range of topics from the week including the transition to digital banking. We will share a copy in next week’s edition.

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Upcoming Events:

• Wednesday 8 March 2023
  Cracking the Code: Innovation for a gender-equal future
  Minter Ellison, Sydney (3:30pm – 7:00pm).

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Submissions Lodged:

• Climate Related Financial Disclosure

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Upcoming Submissions:

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Selected Media:

• The Australian – “Banks slow to help savers” – RBA governor Philip Lowe
• AFR – Bank and competition inquiries to probe market power
• AFR – CBA heeds Senate demand, pauses regional branch closures.
• The Guardian –  Westpac and Commonwealth pause regional bank closures during Senate inquiry

Weekly Update