Weekly Update: 12.05.23

“We know the best long‑term guarantee of rising living standards, stronger wages and a better quality of life is a growing and productive economy. That’s why our Budget is underpinned by a plan to modernise our economy and maximise our strengths…” 

Treasurer Jim Chalmers

Parliamentary Update:

• This week the Treasurer Jim Chalmers delivered the Albanese Government’s second Federal Budget. Key themes included cost of living relief, support for vulnerable Australians, and strengthening the Budget.  Some key Budget announcements relevant to banking include: 

1. Fighting scams and improving online safety
   • $26.9 million towards the next steps for Digital ID 
   • $86.5 million over four years to combat scams and online fraud. This includes:  
   • $58 million over three years to establish the National Anti-Scam Centre within the ACCC and establish public-private sector Fusion Cells to target specific scams.  
   • $17.6 million over four years (and $4.4 million per year ongoing) for ASIC to identify and take down phishing websites and other websites which promote investment scams. 
   • $10.9 million over four years (and $2.2 million per year ongoing) to establish and enforce an SMS sender ID registry. 
2. Implementing the ban on the use of credit cards for online gambling in Australia.
   • Funding to support the National Self-exclusion Register (BetStop). 
3. Clean energy and sustainable finance
   • $1.3 billion Household Energy Upgrades Fund, which includes: 
   • $1 billion in funding for the Clean Energy Finance Corporation towards low-cost financing and to support energy efficient home upgrades. 
   • $36.7 million over four years to improve energy efficiency in housing, including through the Nationwide House Energy Rating scheme.  
   • $1.6 million to support the initial development of a sustainable finance taxonomy. 
4. Other announcements
   • The frequency of Financial Regulator Assessment Authority reviews will be reduced from every two years to every 5 years.
   • The ABS will move to a full monthly CPI, including obtaining more frequent data observations of prices in the economy. 
   • From 1 July 2024, the ATO will reduce the use of cheques for small business income tax refunds.  

• In the Senate, there was debate this week over the Housing Australia Future Fund (HAFF) bills. The Coalition and Greens sought to delay debate on the HAFF bills until the Senate next sits on week of June 3.

ABA hearing from Treasurer Dr Jim Chalmers MP at the National Press Club of Australia, after he handed down the 2023-2024 Federal Budget the previous night.

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Policy Update:

• ABA members, supported by Norton Rose Fulbright, began internal consultations on an industry response to the proposed changes to the AML/CTF Act. Members explored opportunities to improve specific elements of the existing Act as well as opportunities for simplification. 
• The ABA attended a Trans-Tasman Business Circle Study Field Trip of the Western Sydney Airport and Aerotropolis, Parkland City Growth Corridor and Bradfield City Centre with delegates to discuss the growth plan for business and the surrounding community from 2026 as the Airport opens. The ABA heard from a panel of key government and industry representatives on the policy initiatives and opportunities underway in the corridor relating to housing, business and logistics.

ABA at the Trans-Tasman Business Circle Study Field Trip at the Western Sydney Airport and Aerotropolis.

• ABA members met with the Data Standards Board to share insights on how action initiation within the CDR can be safely and effectively rolled out. Discussion focussed on the inter-relationship between AML/CTF obligations and the action initiation process. 
• The ABA participated in a Residential Energy Efficiency Disclosure Initiative forum meeting with government and industry stakeholders to discuss progress on energy efficiency rating tools following the Federal Budget, which announced several initiatives relating to expediting energy efficiency in residential housing.  

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Regulatory Update:

• ASIC released their enforcement and regulatory update and re-affirmed their commitment to targeted action against predatory lending  high-cost credit or consumers experiencing financial difficulty. 
• A new Chief Economist, Dr Lilla Csorgo, has been appointed by ACCC. 
• ASIC provided an update on recent actions they have taken against greenwashing, as well as an updated Information Sheet. 

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Economic Update:

• After nearly a year of decline in new housing lending, we saw an uptick in March 2023. This was primarily driven by owner-occupiers with 31,470 new loans written for owner-occupiers & 15,303 for investors.  
• This returns new lending to just below the average we saw during 2022 (34,620 for owner-occupiers & 17,525 for investors) after lows in January & February. Despite this increase, refinancing continues to outpace new lending with 59,199 refinanced loans for both owner-occupier & investors compared to 46,733 new loans, Figure 1. 

Figure 1: New housing lending, Owner-occupier & investor, July 2019 – March 2023, N 

Source: ABS, Lending Indicators, Tables 3 & 13; ABA analysis 

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Communications and Media Update:

• We welcomed the Federal Budget’s investment in combatting scams and supporting sustainable finance, issuing a media release on the evening of the budget. Read more here. 
• A cross-industry initiative to provide a one-off $7.75 million boost for financial counselling services was announced. Read more here.  
• ABA launched a new interactive ‘Spend the Day’ site, which provides a comprehensive snapshot of how Australians are using different payments technologies.  

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Upcoming Events:

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Submissions Lodged:

• Data Standards Body – Decision Proposal 289 (Register Standards Revision). 

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Upcoming Submissions:

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Selected Media:

• The Australian – Australians are ditching cash as more turn to smartphone and digital payments
• Mortgage Professional Magazine – Aussie lenders donate to financial counselling services 
• The Australian – Consumer data rights funding boost raises a debate over its slow uptake 
• SMH – Chalmers’ inflation pledge sparks big Australia stoush with Dutton 
• AFR – Record bank profits belie the rocky road ahead

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